BUSINESS PLAN - MERM - A Lakegroup Company - AJE PDF

A Lakegroup company
BUSINESS PLAN & Feasibility Study
Middle East Ready Mix LLC

P.O Box: 52341, Dubai UAE
T: +971 4 885 8421
+971 4 885 8800
F: +971 4 885 8678
www.lakeoilgroup.com
BUSINESS PLAN & FEASIBILITY STUDY
CONTENTS
Page
Introduction
03
01 Company
04
02 Market
07
03 Products
09
04 Customers
16
05 Competitors
17
06 Marketing and Sales Organisation
19
07 Management, Personnel and Organisation
23
08 Technology and Machinery
27
09 Financial Statements and Forecast
31
10 Mission Statement
32
11 Executive Summary
33
Appendix I
Appendix II
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INTRODUCTION.
The Company Lake Group Middle East Ready Mix LLC (MERM) have established a Ready Mix
Concrete manufacturing facility (hereinafter Factory) in Jabel Ali, Dubai Investment Park II - United Arab
Emirates (UAE), that will produce a ready mix concrete mixes and special concrete to supply the local
market on the 22nd October 2014.
The products will be manufactured in a Ready Mix Concrete Plant to satisfy the highest quality level of
home standards desired by customers in the target market, the UAE.
The customers will be project development companies as well as general building contractors and
architects willing to apply the cutting edge ideas of the ready building system for residential housing.
Consequently, the marketing activities should be specific for these target groups. Currently, the market
for building materials in the UAE is growing at a high rate and existing suppliers are not able to cover
the demand. The market analysis showed that the next planned investments in the building industry of
the UAE will exceed former projects.
The Factorys production portfolio will produce a special concrete mixes and unique environmentally
friendly mixes in the UAE market and will provide a competitive advantage over the existing ready mix
concrete plants. The distinguishing factor will be high quality environmentally friendly mixes, high
performance, ultra-high performance concrete, crack resistant/low shrinkage concrete, selfconsolidating concrete and number of others. We are specialist to modify the properties of concrete
through the use of innovative concrete admixture, combined with the proportions of the various
constituents depending on the type of jobsite requirements and application. Furthermore, the technical
design of the Factory will allow the extension of existing production by high standard concrete facility to
produce a special precast and decorative elements for industrial use (halls, stadiums or multi-cinemas).
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01 Company
01.1 The Company
Middle East Ready Mix LLC (MERM) was established as a limited liability company with an aim to
produce highly durable and non-durable concrete which are used for piling, foundations and structures.
The production was started on 22nd October 2014. Nevertheless; the company was started on 2005 and
we as Lake Group took over. The company will be producing all of type of concrete. We are specialist to
modify the properties of concrete through the use of innovative concrete admixture, combined with the
proportions of the various constituents depending on the type of jobsite requirements and application.
We can design concrete that is more flowable, stronger, develops strength faster and also retains
workability longer.
We offer a special concrete portofolio, comprised of such products as high performance concrete, crackresistant/low shrinkage concrete, self-consolidating concrete, and number of others.
Middle East Ready Mix LLC (MERM) is a Lake Group company from Tanzania.
The company is using the latest German technology and it was established in association with KIT, BHS
and command Alkon.
As a part of our policy; we continuously work to improve the properties of concrete that make it a key
component of sustainable construction: durability, resistance to aggressive environment, light reflection,
and capacity to store energy among others.
We also constantly work to develop innovative solutions that advance the sustainable buildings that can
take advantage of the benefits of concrete in a wide range of applications.
In order to provide high Quality concrete to it valued customers MERM has set up two fully automatic
concrete batching plants, with attached ice plants, in Dubai investment park, Jebel Ali, United Arab
Emirates.
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Placing the company in Jabel Ali - DIP will give the following advantages:
-
LOCATION: It is strategically located close to Dubai and Abu Dhabi, with very good access to
all building sites locations in above mentioned emirates by road and direct access to the
planned new projects.
INFRASTRUCTURE: unrivalled in the region in terms of facilities and efficiency. The location
has a full range of services, which are cheap to maintain.
STABILITY: political and social stability is characterised by laws that are both pragmatic and
liberal
COMFORT: possibility of labour accommodation close to the plant and at the same time with
full social-infrastructure for the worker (shops, cultural centres, leisure facilities etc.).
01.2 The Factory.

The factory as stated above is located in a very strategic area which is Dubai Investment Park with the
full facility under a plot number 597-133, Dubai Investment Park II UAE and leased with built office
block, laboratory block, control block, maintenance shed, nine aggregates sheds, storage warehouse,
and guard house in addition to 2 fully automated concrete batching plant. For fully detailed report; see
Appendix 1 (as per third party inspection).
The factory will produce the following type of concrete;
o Durable and non-durable concrete
o High-strength concrete.
o High-performance concrete.
o Ultra-high performance concrete.
o Micro-reinforced ultra-high performance concrete.
o Self-consolidating concrete.
o Shotcrete Gunite concrete.
o Pervious concrete.
o Waterproof concrete.
o Crack resistant/low shrinkage concrete.
o Cellular and lightweight concrete.
o Geopolymer concrete.
o and; many more.
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The production process includes the following stages starting from the raw materials to the construction
stage.
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02 Market
According to the UAE Contractors' Association, the construction market in UAE the value of ongoing
construction projects in 2015 has been estimated at USD 727 billion.
Dubai won the right to host the World Expo 2020. The largest ever Expo site is set to be built in Jebel Ali
(DWC) area at a total cost of between USD 2B 4B. The secondary infrastructure spend will be
upwards of USD 8B, and will include construction opportunities in the transport, hospitality, retail and
commercial sectors.
The building industry in the region has drawn on the best technology and expertise available, and is
now in a position to take on world-class projects with confidence. Particular the market for engineered
building is expanding as the UAE's economy enjoys continued growth. Engineered building is used as
industrial sheds, warehouses, showrooms, standalone outlets, hangars, farm buildings, supermarkets,
office buildings, towers, malls, cinemas, and special structures. A good number of offices in industrial
areas in Dubai have been constructed using ready mix concrete technologies.
Construction materials, equipment and machinery, manufactured in Europe, above all are popular
because of its high quality advanced technology. The industry itself is calling for practices and building
codes to be regulated. British and German standards are recognised and readily accepted in the
market, however American standards have been gaining ground.
Local market demand for building products is growing rapidly as both public and private sectors are
floating tenders for the construction of diversified commercial, residential and institutional buildings.
Major public sector projects in the UAE include airport developments, road building and the expansion
of utilities. Private sector development is visible in the development of new shopping malls, hotels,
apartment blocks and office towers.
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The major multi-billion Dirham projects are planned in the emirate of Dubai for 2015 are;
Source: MEED
DAEP - DWC: Al Maktoum International Airport Expansion
Nakheel Corporation - Deira Island
Dubai Holding - Mall of The World Entertainment District
DEWA - Hassyan Coal Fired IPP Phase 1
Dubai RTA - Dubai Metro: Purple Line
Dubai RTA - Dubai Metro: Blue Line
Damac Properties - Akoya Oxygen
Meraas Holdings - La Mer
ICD - Palm Jumeirah: Royal Atlantis Resort & Residences, Phase 2
Dubai RTA - Dubai Metro: Red Line Extension
Nakheel Corporation - Villas At Nad Al Sheba
Dubai Holding - Innovation Hub
Meydan - Meydan City: Hadaeq Sheikh Mohammed Bin Rashid Scheme
Dubai Supreme Council of Energy / China Sonangol - Dubai Refinery
DWTC - Redevelopment of World Trade Centre - Phase II
Transport
Construction
Construction
Power
Transport
Transport
Construction
Construction
Construction
Transport
Construction
Construction
Construction
Oil
Construction
31,668
8,908
5,800
3,540
2,730
2,500
1,850
1,600
1,500
1,300
1,200
1,200
1,089
1,000
1,000
Main Contract PQ
Main Contract Bid
Design
Main Contract Bid
Study
Study
Design
Design
Main Contract PQ
Design
Design
Study
Main Contract Bid
Main Contract PQ
Main Contract PQ
Resume:
The GCC region has witnessed a great boom in the construction sector with projects estimated at
hundreds of billions of dollars, of which a significant part is being spent on the UAE's huge projects.
Looking ahead to 2015 projects, the Ventures ME Report highlighted that figures across both the
building construction and interiors markets are both set to increase further.
US$72bn worth of completed projects and US$103bn worth of awarded projects are forecasted over the
next 12 months; the interiors market is also likely to grow by 9 percent.
The Healthcare Sector is expected to grow by 91.12 percent from a value of US$3.72bn registered in
2014, to an estimated value of US$7.11bn for 2015. Qatar in particular will be the country with the
majority of healthcare buildings completed worth a total value of US$2.43bn -followed by KSA with
US$2.15bn and the UAE US$1.82bn. Despite the huge increase in the Healthcare Sector, the building
construction market will still be led by the residential and commercial sectors that together will account
for over half of the market share concentrated particularly in KSA, the UAE and Qatar.
Interior Fit-out Market:
Out of an overall estimated market value of US$7.35bn, the Residential Sector will account for 41.95
percent and US$3.09bn in value, followed by the Commercial Sector at 17.15 percent and US$1.26bn
of value and the Hospitality Sector with 13.51 percent and US$99mn in value.
When compared to 2014 figures, the Healthcare Sector will see the biggest growth with a huge 91.6
percent increase and reaching a value of US$569m. The Education Sector is expected to see the
biggest drop in value by -13.72 percent from US$571m to US$492m.
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03 Products.
Raw Materials
Cement
The main source of cement if from the UAE domestic market; could be from Al Fujeirah Cement Co., Al
Binani Cement Co., ARKAN cement, Cemexetc
Cement from other manufacturers will also be provided if required by customer. Only deliveries having
quantity certificate showing specific compliance will be accepted. The total capacity of cementitious
materials is 3000 tons at a time on daily basis.
Mineral Additives
Silica fume, Ground Granulated Blast Furnace Slag (GGBS) and Purified Fly Ash (PFA) are also
available to produce high performance concrete. All mineral additives will be stored in separate silos
and dispatched into the mixer through automatic weighing systems. The quantity of the additives used
in the concrete depends on the specification requirements.
Coarse Aggregates
Fully crushed and sound coarse aggregates (20mm and 10mm) from the approved sources are
available in separate purpose built storage bays.
Fine Aggregates
Crushed rock sand (washed) from the approved sources as per the internal QA/QC procedure of MERM
and Dune sand from Al Ain/Al Dhaid will be used for the concrete production. Middle East Ready Mix
LLC (MERM) shall strictly conform to Dubai Municipality Administrative order No. 143-91 and
only sand which is certified as complying is permitted to be used in the ready mix concrete.
Water
The main source of water is Dubai. For quality control purposes regular independent laboratory tests will
be conducted on samples collected from the main water tank. In addition, water is chilled to control the
temperature of Ready Mix Concrete. Whenever required flake ice will also be used to maintain the
temperature of concrete below 32 o C.
Admixture
MERM uses admixture from different suppliers. For normal concrete, plasticizers, superplasticisers or
combinations of these two will be used. In addition, special additives such as hydrophobic pore
blockers, water proffers etc. will be used upon the request of the customer. All admixtures will be
dispensed through automatic dispensing system.
Water Treatment Recycling Plant is already available in line with Dubai Municipality
requirements and regulations.
Each location has an equipped mechanical workshop with foreman and skilled mechanics supervised by
workshop Managers and two Mechanical Engineers. These Engineers implements an effective program
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to keep plants and equipment in a suitable working condition. Moreover; as well as the technical team in
line with Dubai Municipality Administrative order No. 192 for the year of 2013.
03.1 Durable and non-durable Concrete

Preventing water and chlorides from penetrating concrete and protecting steel reinforcement from
corrosion extends the useful life of concrete structures and lessens the demand for new cement in
construction and reduces maintenance and replacement costs.
Concrete is a fundamental building material and has many beneficial properties, including being
versatile, strong, and readily available. However, cement, the glue that holds the concrete mix together,
has a large carbon footprint. Cement production is energy intensive and the process releases CO2.
Using the GGBS with the cement and concrete mix is achieving the durability of the concrete.
GGBS
Cement
03.2 High strength Concrete

Has a compressive strength greater than 40 MPa (5800 psi). In the UK, BS EN 206-1 defines High
strength concrete as concrete with a compressive strength class higher than C50/60. High-strength
concrete is made by lowering the water-cement (W/C) ratio to 0.35 or lower. Often silica fume is added
to prevent the formation of free calcium hydroxide crystals in the cement matrix, which might reduce the
strength at the cement-aggregate bond.
Low W/C ratios and the use of silica fume make concrete mixes significantly less workable, which is
particularly likely to be a problem in high-strength concrete applications where dense rebar cages are
likely to be used. To compensate for the reduced workability, superplasticizers are commonly added to
high-strength mixtures. Aggregate must be selected carefully for high-strength mixes, as weaker
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aggregates may not be strong enough to resist the loads imposed on the concrete and cause failure to
start in the aggregate rather than in the matrix or at a void, as normally occurs in regular concrete.
In some applications of high-strength concrete the design criterion is the elastic modulus rather than the
ultimate compressive strength
03.3 High Performance Concrete (Grey & Colored)
(HPC) is a relatively new term for concrete that conforms to a set of standards above those of the most
common applications, but not limited to strength. While all high-strength concrete is also highperformance, not all high-performance concrete is high-strength. Some examples of such standards
currently used in relation to HPC are:
Ease of placement
Compaction without segregation
Early age strength
Long-term mechanical properties
Permeability
Density
Heat of hydration
Toughness
Volume stability
Long life in severe environments
Depending on its implementation, environmental
03.4 Ultra - High Performance Concrete (Grey & Colored)

Is a new type of concrete that is being developed by agencies concerned with infrastructure protection.
UHPC is characterized by being a steel fibre-reinforced cement composite material with compressive
strengths in excess of 150 MPa, up to and possibly exceeding 250 MPa.UHPC is also characterized by
its constituent material make-up: typically fine-grained sand, silica fume, small steel fibers, and special
blends of high-strength Portland cement. Note that there is no large aggregate. The current types in
production (Ductal, Taktl, etc.) differ from normal concrete in compression by their strain hardening,
followed by sudden brittle failure. Ongoing research into UHPC failure via tensile and shear failure is
being conducted by multiple government agencies and universities around the world.
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03.5 Micro-reinforced ultra-high performance concrete
Is the next generation of UHPC. In addition to high compressive strength, durability and abrasion
resistance of UHPC, micro-reinforced UHPC is characterized by extreme ductility, energy absorption
and resistance to chemicals, water and temperature. The continuous, multi-layered, three dimensional
micro-steel mesh exceeds UHPC in durability, ductility and strength. The performance of the
discontinuous and scattered fibers in UHPC is relatively unpredictable. Micro-reinforced UHPC is used
in blast, ballistic and earthquake resistant construction, structural and architectural overlays, and
complex facades.
03.6 Self-consolidating concrete
The defects in concrete in Japan were found to be mainly due to high water-cement ratio to increase
workability. Poor compaction occurred mostly because of the need for speedy construction in the 1960s
and 1970s. Hajime Okamura envisioned the need for concrete which is highly workable and does not
rely on the mechanical force for compaction. During the 1980s, Okamura and his Ph.D. student
Kazamasa Ozawa at the University of Tokyo developed self-compacting concrete (SCC) which was
cohesive, but flowable and took the shape of the formwork without use of any mechanical compaction.
SCC is known as self-consolidating concrete in the United States.
SCC is characterized by the following:
extreme fluidity as measured by flow, typically between 650750 mm on a flow table, rather
than slump (height)
no need for vibrators to compact the concrete
easier placement
no bleeding, or aggregate segregation
increased liquid head pressure, which can be detrimental to safety and workmanship
SCC can save up to 50% in labor costs due to 80% faster pouring and reduced wear and tear on
formwork. In 2005, self-consolidating concretes accounted for 1015% of concrete sales in some
European countries. In the precast concrete industry in the U.S., SCC represents over 75% of concrete
production. 38 departments of transportation in the US accept the use of SCC for road and bridge
projects. This emerging technology is made possible by the use of polycarboxylates plasticizer instead
of older naphthalene-based polymers, and viscosity modifiers to address aggregate segregation.
03.7 Shotcrete Gunite concrete.
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(Also known by the trade name Gunite) uses compressed air to shoot concrete onto (or into) a frame or
structure. The greatest advantage of the process is that shotcrete can be applied overhead or on
vertical surfaces without forming. It is often used for concrete repairs or placement on bridges, dams,
pools, and on other applications where forming is costly or material handling and installation is difficult.
Shotcrete is frequently used against vertical soil or rock surfaces, as it eliminates the need for formwork.
It is sometimes used for rock support, especially in tunneling. Shotcrete is also used for applications
where seepage is an issue to limit the amount of water entering a construction site due to a high water
table or other subterranean sources. This type of concrete is often used as a quick fix for weathering for
loose soil types in construction zones.
There are two application methods for shotcrete.
dry-mix the dry mixture of cement and aggregates is filled into the machine and conveyed with
compressed air through the hoses. The water needed for the hydration is added at the nozzle.
wet-mix the mixes are prepared with all necessary water for hydration. The mixes are pumped
through the hoses. At the nozzle compressed air is added for spraying.
For both methods additives such as accelerators and fiber reinforcement may be used.
03.8 Previous concrete.
Used in permeable paving, contains a network of holes or voids, to allow air or water to move through
the concrete. This allows water to drain naturally through it, and can both remove the normal surfacewater drainage infrastructure, and allow replenishment of groundwater when conventional concrete
does not. It is formed by leaving out some or all of the fine aggregate (fines). The remaining large
aggregate then is bound by a relatively small amount of Portland cement. When set, typically between
15% and 25% of the concrete volume is voids, allowing water to drain at around 5 gal/ft/ min (70
L/m/min) through the concrete.
03.9 Waterproof concrete.
British Standards set out to ensure that reinforced concrete structures provide the degree of protection,
internal environment and functionality required by owners or developers.
The term 'Waterproof' therefore conjures up a whole range of ideas. If the structure in question is to
retain water, say a water storage tank, then the designer may simply work to the design requirements of
the water retaining code, BS 8007, which sets out to limit crack width. This may be achieved by utilizing
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a good quality, ordinary concrete, close attention to joint details and providing extra crack control
reinforcement; dampness being acceptable.
If on the other hand the structure is habitable or designed to house sensitive electronic equipment or
valuable archives, then simply designing to the water retaining code is not sufficient. This is especially
so given that ordinary good quality concrete provides little resistance to the passage of water vapour.
There are several degrees of waterproofing to be considered, all loosely defined under 4 categories in
BS 8102.
03.10 Crack resistant/low shrinkage concrete.
While often overlooked, the shrinkage potential of a concrete mixture is perhaps the most important
consideration for concrete used to construct industrial floors on ground. All concrete, even shrinkagecompensating concrete, shrinks. Because of a loss in volume, concrete shrinkage can lead to cracking
when base friction or other restraint occurs. Shrinkage also causes curling/warping which can lead to a
variety of slab issues including decreased load-carrying capacity (structural cracking) and joint stability
problems such as spalling. Shrinkage-induced cracking and curling/warping can also contribute to
decreased vehicle ride (a potential health and safety issue) and floor covering failures (buckling caused
by reverse warping). In short, shrinkage is a factor in most concrete slab-on-ground performance issues.
To increase the performance of concrete floors, shrinkage must be better understood and addressed.
Therefore; a different type of special chemicals will be used in order to prevent this phoneme.
03.11 Cellular and lightweight concrete
Aerated concrete produced by the addition of an air-entraining agent to the concrete (or a lightweight
aggregate such as expanded clay aggregate or cork granules and vermiculite) is sometimes called
cellular concrete, lightweight aerated concrete, variable density concrete, foamed concrete and
lightweight or ultra-lightweight concrete,[14][15] not to be confused with aerated autoclaved concrete,
which is manufactured off-site using an entirely different method.
03.12 Geopolymer concrete
Geopolymer cement is an alternative to ordinary Portland cement and is used to produce Geopolymer
concrete by adding regular aggregates to a geopolymer cement slurry. It is made from inorganic
aluminosilicate (Al-Si) polymer compounds that can utilise 100% recycled industrial waste (e.g. fly ash,
slag) as the manufacturing inputs resulting in up to 80% lower carbon dioxide emissions. Greater
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chemical and thermal resistance, and better mechanical properties, are said to be achieved for
geopolymer concrete at both atmospheric and extreme conditions.
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04 Customers
Currently the main customers and prospective clients for future business are the developer companies
(especially where their own or hired architects are involved in the decision making process for material
used in construction), consultants and constructing companies.
The main product in production durable and non-durable concrete is very specific and would be sold
only to general contractors as an additional part of any contract with them. General contractors primarily
engaged in construction (including new work additions, alterations, remodelling, and repair) of
residential buildings other than single-family house estates. This includes hotels, motels, apartments,
and apartment houses or skyscrapers.
Several architects working in UAE are looking for new performance possibilities other than those
already available. Currently only normal concrete mixes are available on the market. Also for the
facades only glass or natural stone faades are used for the cladding. Acid treated pre-coloured wall
panels are not known in UAE and the concept was enthusiastically received by the architects
interviewed and was generally very popular among potential clients. Architectural concrete demand
great care and precision when casting to create a finished high quality product that has classic, stoneetched appearance. With the successfully technology offered by the Company, which can convince the
architects and finally the clients.
The ordinary ready mix concrete is a structural product for building industry. General and special trade
contractors primarily engaged in the construction of heavy projects not elsewhere classified. This
includes industry halls, canals, drainage systems, athletic and recreation facilities, land preparation, rock
removal, waste, water and sewage treatment plants, trenching construction and bridges, viaducts,
elevated highways, and highways, pedestrian and railway tunnels. Especially if the Company is going to
realize whole housing projects then the production of ordinary concrete mixes as a supplement to the
main production is necessary. Therefore the Factory is providing these products also.
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05 Competitors
The market in general is price-driven and local contractors are used to using the standard products
available, which must be worked on further to achieve a high quality finish.
However; Middle East Ready Mix LLC offers unique products, which are at this moment almost
completely unavailable on the market and which have a high quality finish that, does not need an
additional touch up.
Competition from international companies in ordinary ready mix is available and companies with a
physical presence in the market and a strong-based local active sponsor are often seen as preferred
contractors. The plant which should be settled up will not be as labour intensive as other existing
manufactures. This will cut out the possibilities of human error in our production line and reduce the cost
of production.
Also because of our use of newest technology and machinery the competitors will have to modernise
their own production to keep pace with the Factory leaving it the position as one of the leading producer
of high modern ready mix concrete in UAE.
The most important competitors on this area are:
1. Dubai Ready Mix LLC - offers: different ranges of normal concrete for different projects in the Dubai
region.
2. Al Falah Ready Mix LLC - offers: different ranges of normal & durable concrete for different projects in
the Dubai and Abu Dhabi regions.
3. Unibeton Ready Mix LLC - offers: different ranges of normal, high strength & durable concrete for
different projects in the Dubai and Abu Dhabi regions.
4. Emirates Beton Ready Mix LLC - offers: different ranges of normal & durable concrete for different
projects in the Dubai region particularly for Al Shafaar group as it is a sister company.
5. Q.Mix Ready Mix LLC - offers: different ranges of normal concrete for different projects in the Dubai
and Sharjah regions.
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Note;
No one of the above mentioned producers are providing the high quality
colored concrete, or Ultra-high performance concrete and none produce high
quality acid treated faades or photo concrete architectural designs.
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06 Marketing and Sales Organisation.

06.1 Marketing Strategy.
The company's marketing strategy will be to promote sales of our highest quality new products and
attain a solid position as a major supplier of standard products.
Focusing on this product-component relationship will facilitate the company's ability to pursue the
vertical integration of the business and pass on the value-added savings to our customers. The
company's overall strategy is based on a continuous improvement process of setting objectives,
measuring results, and providing feedback to facilitate further growth and progress.
The company plans to rapidly develop marketing alliances with architects, building industry leaders and
pursue new sales of its products for residential and commercial builders. The market strategy is to
capitalize on the alliances by securing city, state, and government contracts.
It is planned to organise events and seminars in order to acquaint potential clients with the new
techniques and technologies that we alone will be making newly available on the market. At these
meetings we will have the opportunity to convince potential clients (architects, QC-Eng. and contractors)
of the unequalled quality of our brand new products.
The Factory should adopt a corporate strategy that is dedicated to improving the performance of
activities on the critical path of its customers' projects. The company does this by building on its core
strengths, innovative equipment, design engineering expertise, and project and site management, within
an environment of safety excellence.
From the customers' point of view, this strategy translates into these benefits:
Reduction of set-up time for classic kinds of building construction.
Increased site safety.
Project cost reduction.
Quality construction and a new kind of technology used.
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Review of structural plans.
The overall marketing plan should based on the following fundamentals:
Segmentation of the planned market(s).
Distribution channels to reach market segments: developer, architects associates

and building contractor federations.
Share of the market expected to be captured over a fixed period of time.
Just as important is to be committed to an extensive promotional campaign. This is done aggressively

and on a broad scale. To accomplish initial sales goals, the company has to implement an effective
promotional campaign to accomplish two primary objectives:
Attract a quality work force that has a desire to be successful.
Attract customers who will constantly look for the products.
In addition will be advertisements in the yellow pages, trade press, and on billboards throughout the
state. The objective of brochures is to portray the companys goals and products as an attractive
functionality. It is also to show customers how to use the latest in technology as it relates to construction
and building services. An extra budget should be planned for an ongoing, state-wide advertising
campaign.
As an extra incentive for customers (and potential customers) to remember the name, could be planned
to distribute coffee mugs, T-shirts, pens, and other advertising specialties with the company logo. This
will be an ongoing programme for the company, when appropriate and where it is identified as
beneficial.
06.2 Distributions channels and sales organisation.
Because different kinds of products are offered for marketing then different approaches are necessary
for advertising the products.
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The high quality colored ready mix concrete and Ultra-high performance, which are completely
new product in UAE, must be aggressively marketed as there is nobody producing this product. Orders
for this product will usually come from general construction companies. To get onto these orders it is
necessary to be well-informed concerning building activities in the area both current and projected. To
sell successfully extra arguments are needed in order to make this part of the plants construction more
attractive to the buyer, for example:
because of new transit mixers and machinery having a perfect work surface on
the production, the concrete productivity will be of a very high-quality smooth
finish;
the other side of the walls panels should be plastered by very thin layer of
gypsum instead standard cement plastering;
no additional insulation is needed (in case of insulated lightweight concrete);
full filling the newest rules regarding coldness saving;
physical building properties, which cannot be offered by conventional concrete.
the customer can be given advice during the selecting phase of their project for
example it may be offered financial advantages to the customer by suggesting
the use of thinner slabs if and where possible thus reducing costs depending
upon structural calculations;
The marketing of these products should begin in the first phase of any new building project. Good
contacts are needed to architects, building owners and other project investors or clients representatively
which is already existing in our case.
The sales staff will be professionally acquainted with this technology and able to show the client the
advantages of this product and its high quality and optical value. Contact with the customer should be
very well balanced.
Very good connections with the different types of client are needed for this, preferably someone with a
more mature knowledge of the market in the area would be suitable. Because of the rarity of this
particular product in the UAE, marketing should not be a problem.
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Self-evidently samples of this product should be well presented on the plant area in eye-catching
displays.
The company must plan the selling of ordinary ready mix concrete (blinding, screed C30 and C40
grades concrete etc.) through a direct sales force using, relationship selling, and subcontractors to
reach our markets. These channels are most appropriate because time to market is reduced as is
capital requirements, and it gives fast access to established distribution channels.
Because this particular product is universally available in UAE and not so profitable it should be
marketed as an extra to our main product and so extra marketing would not be cost effective. In the
plant a high quality professionally prepared exhibition with large scale samples used in various
situations will be on show.
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07 Management, Personnel and Organisation.

One of the decisive success factors of the entrepreneurial initiative is the potential of the management
team and labour. The subject of management is in many cases more important than the whole
entrepreneurial initiative.
The new undertaking will be successful only if all the necessary managerial qualities and conviction in
the product are apparent. This should emphasize the managements ability to effectively implement the
business plan and deal with unanticipated changes.
The company's management philosophy will be based on responsibility and mutual respect. The
maintenance of an environment and structure that encourages productivity and respect for customers
and fellow employees has to be a must.
The company employees and management are committed to:
produce responsibly, conscientiously and believe that a well made product is not only good for
the company but also for themselves;
providing a safe work environment to protect themselves, the employees of customers and
subcontractors, and the public.
supplying safe products with the highest quality for customers.
continuously improving the company's safety programme to reduce the risk of accidents and
occupational illness in a changing work environment.
encouraging employees to participate in accident prevention programmes, and take personal

responsibility for their, and their co-workers', health and safety.
employing properly trained personnel, equipment, and procedures necessary to enable

regulatory compliance, and contribute to the high safety standards for our industry.
monitoring workplaces, enforcing safe work practices, and communicating the company's safety
performance to employees and other stakeholders.
making safety a value-added service that the company provides to its customers.
taking part in training programmes both home and abroad to keep up-to-date with the newest
techniques and technology. This will especially concern foremen positions
Confidential
23

The management of the Factory will be highly experienced and qualified.
All of them should have a long experience and should be highly qualified in their respective fields of
responsibility.
General Manager Job description:
Complete responsibility for sales totals and results;
Represents the company with major customers, the financial community, administrative bodies
and the public;
Manage key personnel of any large investment, where the company has a controlling stake;
Coordinate all legal, accounting and finance, administrative procedures applicable to current
investments of the company in respective markets;
Directing and coordinating financial programs to provide funding for new or continuing
operations to maximise returns on investments and to increase productivity.
Knowledge, Skills and Experience:
Graduate in industry or MBA knowledge;
10+ years of experience in senior management roles within an international building company,
ideally ready mix and concrete, including P&L responsibility;
Emerging markets experience;
Excellent ability to define problems, collect data, establish facts, draw valid conclusions and
lead the team in solving problems;
Strong communications skills, multi-lingual;
Adaptable and culturally sensitive;
Clear cost and results orientated;
Production Manager job description:
Manages and directs the production, based on profit and return of capital;
Plans, develops and implements organisation policies and goals;
Dispenses advice, guidance, direction and authorisation to carry out major plans and
procedures, consistent with established policies and board approval;
Confidential
24
Establishes and maintains an effective system of communications throughout the organisation;
Primary responsibility in machinery, production and quality of products
Knowledge, Skills and Experience:
Graduate in industry or engineering knowledge;
7+ years professional level relevant experience within production of pre-cast concrete elements;
perfect knowledge of concrete technology, shuttering and prefabricated machinery and

equipment;
excellent communication and organisational skills, proven leadership/management capabilities;

o
excellent time management skills, problem-solving attitude, creative thinking, goal and
result-
Training programmes.
The target of the following points is to establish a loyal, hardworking and adaptable work force.
1. New employees must show basic trade qualification or proof of minimum three to five years
experience in the industry.
2. New employees must agree to adapt to the practices in use in other plant.
3. The first group of employees should be schooled in such a way that as further staff is taken on
they can be used as training staff.
4. For exceptional workers with language ability operational training will be arrange with machine
producers abroad.
5. Bonus incentives for safety record, production levels and quality production is to be foreseen.
6. Pay scale linked to participation in company organised courses (trade and language).
Social activities
The target of the following points is to achieve a good team spirit and readiness to help in order to carry
out the days duties enthusiastically.
1. Canteen will provide national food.
2. Establishing team sports (football, basketball etc.).
Confidential
25

3. Cultural events, especially within national holidays.
The staff and workers of the Factory have to be proud to work in the most technologically
advanced plant in the area and identify with it.
Confidential
26
08. Technology and Machinery

08.1 Technology and Machinery for Ready Mix Concrete Batching Plant.
The company is using the latest German technology fully computerized in the batching plant (BHS
Sonthofen, Germany). The horizontal concrete plants are the best and most used solution for production
of the ready mix concrete in the area. With ejector outputs of up to 120m hardened concrete per hour,
the correct performance class is available for every requirement/batching plant.
Confidential
27

08.2 Technology and Machinery for Chilled Water Plant. Already ordered
The technology of the chilled water plant is from KTI, Germany. Our latest containerized chillers are
specially designed for cooling the mixing water for batching plants from 45 C down to less than 1 C.
Using evaporative condensers and a 4-stage cooling system these new containerized chillers are
superior to any common water chiller available in the world. The capacity is 340m3 per hour.
08.3 Technology and Machinery for Ice Plant. Already ordered

The technology of the Ice Plant also is from KTI, Germany with a capacity of 84 tons per day.
Flake ice has the highest surface area per ton of ice, providing a greater cooling efficiency than
any other ice.
Short melting time by the use of flake ice compared to any other ice
Shortest mixing times of the batching plant compared to any other ice as flake ice melts rapidly.
Higher lifespan of the batching plant equipment and cost savings due to the short mixing times
The latent heat, the principal source of the cooling energy is 100 % or even higher as the flake
Confidential
28
ice is sub-cooled (-7 C).
Due to the dryness, the cooling input of flake ice can be accurately calculated and its effects on
the mixtures temperature are quickly apparent.
Flake ice is free flowing, its flakes remain crisp and do not stick together nor do they form
blocks.
Easy to be stored and levelled inside a refrigerated ice storage with a fully automatic ice rake
system
Easy to transport via screw conveyors or blowing system to any location required
No losses due to hot gas defrosting of the freezing surface. Flake ice is sheared from the
freezing surface by the ice removal tools.
Confidential
29

08.4 Technology and Machinery for Concrete Pumps.
The technology is from Germany and China; 4 numbers with a length of 42 meters, 37 meters and 36
meters. In addition to a static pumps with 2 numbers.
08.4 Technology and Machinery for Transit mixer.

The technology comes from HOWO - China with fully branded new 2015 transit mixer with a capacity of
12m3 per truck with 40 numbers.
A fully equipped laboratory to check and confirm the Quality Control procedure in line with the
international and domestic markets standards.
Confidential
30
09 Financial Statements and Forecast

Financial projections are based on prices and sales volume as gathered on the Dubai market during
2014/2015 and upon access to planned projects as described during interviews with local architects,
engineers, QC engineers, contractors, pre-cast and ready mix concrete companies (Safemix Ready Mix,
Think International and Union Cement Products LLC). The prices and conditions (see Appendix II for
Projected Balance Sheet, Projected Income statement and Schedule to projected balance sheet).
Financial notes and assumptions
Revenues will be derived from sales of ready mix concrete. The Factory plans to bid and
receive contracts for commercial concrete projects at all levels throughout the state.
Management also expects to achieve a small percentage of revenues resulting from quality
productivity.
Annual Growth
The Company expects to increase annual growth, on the basis that the company will be
stepping up its sales efforts, as well as initiating new partnerships and alliances that will foster
growth and extensions of our existing markets. These strategies are designed to build
momentum and critical mass within the company and its overall sales results.
Cost of Goods
The Company expects that its products will bear a reasonably high mark-up, because of the
new high quality technology which will be available for the first time in this market.
Confidential
31
10 Mission Statement
The company's mission is to be successful by effectively looking to achieve the targets of high quality,
advanced techniques, and customer service. It is important that the company continues to provide
superb customer service and fast delivery. At the same time, the company's further success will depend
on securing new customers in the served market niches, and maintaining a very good reputation with
clients.
The mission of the Company is to become THE LEADING PRODUCER by providing the best
quality ready mix environmentally friendly concrete and colored ultra-high performance concrete
in the UAE market.
To become the leading provider of the above in the area means always having the best and most
efficient facilities, product quality, and professional staff that are able to provide solutions to any clients
problem. To achieve this, the company is investing in many fields that will result in competitive
advantages for its customers, for example:
Review of structural drawings. The company eliminates possible structural problems and
delays.
Pre-job conferencing upon request. The company thoroughly understands the construction
business and the science of formwork. Recommendations are made, and customers are alerted
when things can be done better. A partnership is based on trust and includes planning and
teamwork.
Delivery. Material choice and placement is of cardinal concern to the company and efficiency on
the job.
Forming, reinforcing, and after-marketing products. One of the things the company does for its
customers is to help streamline the ordering process.
This makes certain target achievement.
Confidential
32
11 Executive Summary
The Company has been established as a Limited Liability Company and a Lake Group Company with
an active share holder Mr. Ally Eidha Awadh.
Mr. Ally Eidha Awadh is topping the list of 10 young African millionaires to watch 2014 Forbes list;
http://www.forbes.com/sites/mfonobongnsehe/2014/07/08/10-young-african-millionaires-to-watch-2014/
Lake Group turnover for the year 2014 stands at USD 465.34 million (Net Profit: USD 34.34 Million) and
USD 824.25 Million in 2014 (Provisional) and expected to cross USD 1 Billion in 2015.
The Factory will produce a ready mix concrete specialising in a technology which is at the moment not
available in the area and supported by the production of classic concrete offering a complete package to
any construction company.
The plant has been established in Jabel Ali (DIP) where not only can the plant and offices be built but
also the workers housed. DIP is unrivalled in the region in terms of facilities and efficiency. The location
has a full range of services, which are cheap to maintain and at the same time has a complete socialinfrastructure for the worker.
The machinery has been supplied by well-known manufacturer (mostly from Germany & China) with
years of proven experience in this area of technology. The batching plant is already existing with the
high quality machinery with the computer controlled planetary mixer technology along with the 4
concrete pumps and 40 transit mixer.
All servicing and training will be carried out by each of the producers as well as by the support of Think
International FZE. A well-known consultancy firm company specialist in all types of concrete
The target market is all of the potential new projects planned in the UAE with special attention to those
planned for Dubai.
Confidential
33

According to the accompanying financial tables it is self-evident that the planned project will be an
extremely profitable investment even in the event of the projected plant does not reaching its planned
100% output. That is because of the new technologies being introduced onto the market by the
company. This would enable the initial investment to be repaid in a very short time.
One can see from all of the projects planned that there will be a stable market for ready mix concrete
and especially the new high quality products that the plant will offer even beyond.
Lake Group is happy to enter into UAE market by acquiring Middle East Ready Mix LLC (MERM) and
wishes to grow exponentially.
Confidential
34
All rights reserved. No part of this publication may be reproduced, stored in a

retrieval system, or transmitted, in any form or by any means, without the prior
permission in writing of Middle East Ready Mix LLC OR Think International FZE,
UAE.
Confidential
35
Appendix I
APE
Assets Appraisal for Middle East Ready Mix L.L.C
P.O Box......., Dubai, UAE
19 October 2014
Assets Appraisal Report

port
19 October 2014
Customer: M/s Middle East Ready Mix L.L.C

P.O Box:..........., Dubai
United Arab Emirates
Private & Confidential

Chesterton International LLC
Mena Head Office:
th
Office# 1802, 18 Floor
Boulevard Plaza Tower 1
Downtown Dubai
P.O Box: 283361
Dubai, UAE
Job Ref No. PM/004/10/2014
Branch Office:
Office:
st
Office# 106, 1 Floor
Al Rasis Tower
Al Barsha 1
P.O Box: 283361
83361
Dubai, UAE
Page 1 of 10
APE
19 October 2014
Contents
1.0 Introduction
03
2.0 Company Details
04
3.0 Asset Details
04 - 05
4.0 Insurance Policy
06
5.0 Plant & Machinery Appraisal
06
6.0 Appraisal Value
07
Disclaimer
08
General Principles
09
Photographs
09 & 10
Job Ref No. PM/004/10/2014
Page 2 of 10
APE
19 October 2014
Plant & Machinery (Concrete Batching Plants) Appraisal

Chesterton Reference: PM/004/10/2014
Customer: M/s Middle East Ready Mix L.L.C
1. INTRODUCTION
This report is prepared for M/s Middle East Ready Mix L.L.C.
The purpose of this report is to determine the market value of the assets owned by M/s Middle East
Ready Mix L.L.C, in order to secure credit facilities / financing from Banks / Financial Institutes.
We refer to your (The Customers) instructions dated 12 October 2014 to carry out the appraisal of their
concrete batching plants and related accessories, in accordance to our agreed Terms and Conditions.
The assets were inspected by Mr. Bilal Ahmed (Valuer / Surveyor Plant and Machinery) on 15 October
2014 and report undertaken by Mr. Khizar Hayat (Valuations Manager Plant and Machinery),
supervised by Mr. Simon Gray (Managing Director). We write to advise you as to our opinion of the
Market Value of the assets to be used for the purpose of securing credit facilities / financing from banks /
financial institutes.
We confirm that to the best of our knowledge, M/s Chesterton International LLC has not had any previous
involvement with the subject assets or the Customer, which could give rise to a conflict of interest.
Our report and appraisal is subject to the Appraisal Conditions and Assumptions that are also included in
the Disclaimer section.
For the purposes of this report and appraisal, the date of valuation is 15 October 2014.
In accordance with your instructions, we provide appraisal within this report as follows;
Market Value using Comparable Method of Valuation
We have provided further details in the General Principles section of this report, which outlines the
definition of the appraisals, mentioned above.
Job Ref No. PM/004/10/2014
Page 3 of 10
APE
19 October 2014
2. COMPANY DETAILS
2.1.
Company Overview
Description
M/s Middle East Ready Mix LLC is a Dubai based company and is in the business of producing ready mix concrete.
According to the information provided by the companys representative M/s Middle East Ready Mix LLC is preparing /
overhauling their plants to re-initiate their production activities in the near future. The production activities were halted
in the year of 2008 mainly because of market conditions prevailing at that time.
The list of the assets owned by M/s Middle East Ready Mix L.L.C, considered for the purpose of this valuation
assignment is given below under the heading Assets Details.
Location
The subject assets were inspected in the Dubai Investment Park (DIP) 2 Area of Dubai - UAE.
3. ASSETS DETAILS
Concrete Batching Plant 01
S.No
Description
Qty
Capacity
Country of
Year of
Year of
Manufacture Manufacture Install
Market Value in AED
Batching Plant
Mixer Including:
i) Concrete Discharge System
ii) Support Structure
iii) Charging System
iv) Cement Weigher
v) Electro-Mechanical Micro Silica Weigher
vi) Water System
vii) Admixture Addition System
viii) Electro-Mechanical Weigher
ix) Control Room (Wires and Panel)
x) Protocol Printer etc
1 Set
Prod. Cap: 120 Cm/Hr

(3 Cm/Batch)
Germany
2004
2004
1,100,000.00
Make: BHS Sonthofen GMBH

Model: N/a
Fabrication No: 4038067 - 004D
2
3
Electro-Mechanical Belt Conveyor Including:

i) Weigh-out equipment / load cells
ii) Cable box including cable, leading
to weigher electronics
iii) Suspensions for load cells and belt conveyor
iv) Guides and Stabilizers
Aggregate Storage Bins (In-line Bins)
Made of: Mild Steel
Feeding Conveyor ( From Aggregate Bins to Mixer)
Silos ( Cement Storage)
Made of: Mild Steel
Equipped with: Silo Filters, Pressure Valves,
Level Indicator and Air Injection System
Silos ( Micro-Silica Storage)
Made of: Mild Steel
Set
Max. load:7500 kg
Length: 11 m
Belt Speed: 1.26 m/s
Belt Width:1000 mm
Drive Power: 30 kW
malaysia
2004
2004
Set of
Four (4)
45 Cubic Meter Each
malaysia
2004
2004
90,000.00
Length: 35 M
Motor Power: 15 Kw
malaysia
2004
2004
50,000.00
100 Ton
UAE
2004
2004
330,000.00
40 Ton
UAE
2004
2004
30,000.00
malaysia
2004
2004
45,000.00
malaysia
2004
2004
9,000.00
Itlay
2005
2005
2,000.00
Screw Conveyors
Screw Conveyor
Air Compressor
Length: 5 m
Dia: 273 mm
Motor Power: 15 Kw
Length: 5 m
Dia: 110 mm
Motor Power: 12 Kw
Max. Pressure: 11 Bar
Vol: 500 Lit
TOTAL
Job Ref No. PM/004/10/2014
1,656,000.00
Page 4 of 10
APE
19 October 2014
Concrete Batching Plant 02

S.No
Description
Qty
Capacity
Country of
Year of
Manufacture Manufacture
Year of
Install
Market Value in AED
Batching Plant
Mixer Including:
i) Concrete Discharge System
ii) Support Structure
iii) Charging System
iv) Cement Weigher
v) Electro-Mechanical Micro Silica Weigher
vi) Water System
vii) Admixture Addition System
viii) Electro-Mechanical Weigher
ix) Control Room (Wires and Panel)
x) Protocol Printer etc
Prod. Cap: 120 Cm/Hr

(3 Cm/Batch)
1 Set
Germany
2004
2004
1,100,000.00
Make: BHS Sonthofen GMBH

Model: N/a
Fabrication No: N/a
2
3
Electro-Mechanical Belt Conveyor Including:

i) Weigh-out equipment / load cells
ii) Cable box including cable, leading
to weigher electronics
iii) Suspensions for load cells and belt conveyor
iv) Guides and Stabilizers
Aggregate Storage Bins (In-line Bins)
Made of: Mild Steel
Set
Max. load:7500 kg
Length: 11 m
Belt Speed: 1.26 m/s
Belt Width:1000 mm
Drive Power: 30 kW
malaysia
2004
2004
Set of
Four (4)
45 Cubic Meter Each
malaysia
2004
2004
90,000.00
Length: 35 M
Motor Power: 15 Kw
malaysia
2004
2004
50,000.00
100 Ton
UAE
2004
2004
330,000.00
40 Ton
UAE
2004
2004
30,000.00
malaysia
2004
2004
45,000.00
malaysia
2004
2004
9,000.00
Itlay
2005
2005
2,000.00
Feeding Conveyor ( From Aggregate Bins to Mixer)

Silos ( Cement Storage)
Made of: Mild Steel
Silos ( Micro-Silica Storage)
Made of: Mild Steel
Screw Conveyors
Screw Conveyor
Air Compressor
Length: 5 m
Dia: 273 mm
Motor Power: 15 Kw
Length: 5 m
Dia: 110 mm
Motor Power: 12 Kw
Max. Pressure: 11 Bar
Vol: 500 Lit
TOTAL
1,656,000.00
Accessories:
10,000 Gallons
Country of
Manufacture
UAE
Year of
Manufacture
2004
Year of
Install
2004
30,000 Gallons
UAE
2004
2004
Germany
2014
Yet to Be
Installed
600,000.00
Germany
2014
Yet to Be
Installed
1,397,500.00
S.No
Description
Qty
Capacity
Diesel Tank
Water Tank (Horizontal)- Non Insulated
Made of: Mild Steel
Containerized Ice Water Plant (CIWP)
Make: KTI
Type: CIWP.Eco 400
Containerized Flake Ice Plant (FLIP)
Make: KTI
Type: FLIP.5-102
Mobile Ice Storage (MIS)
Make: KTI
Type: MIS.4-75
1
1
2
3
8
9
Screw Conveyors
Make: KTI
Type: RFS 323 X 12000
Ice Weigher
(Galvanized Hopper with Pneumatic
Operated Gates)
Make: KTI
Type: IW500
Wheel Loader
Make: Caterpillar
Model: 938 G
Chassis No: C800938GTPHN02878
Weigh Bridge
Prod. Cap: 400 m/Day

Ice Water Outlet Temp: 1 C
Water Flow: 16.66 m/Hr
Prod. Cap: 102 Ton/Day
No. of Ice Makers: 2
Power Consumption: 376 Kw
25,000.00
35,000.00
Holding Cap: 75 Ton
Germany
2014
Yet to Be
Installed
520,000.00
Dia: 323 mm
Length: 12000 mm
Motor Power: 11 Kw
Delivery Rate: 40 Ton/Hr
Germany
2014
Yet to Be
Installed
78,000.00
Weighing Cap: 500 Kg
Germany
2014
Yet to Be
Installed
32,500.00
Gross Power: 134 Kw
USA
2008
Capacity: 120 Ton
N/a
N/a
Total
Job Ref No. PM/004/10/2014
Market Value in AED
300,000.00
N/a
70,000.00
3,058,000.00
Page 5 of 10
APE
19 October 2014
4. EXAMINATION
The assets were inspected with regard to their existence, maintenance level and operating condition. According to our
observations the plants were in good condition and required maintenance / overhauling was in progress. Further, the
containerized ice water plant, flake ice plant, mobile ice storage, screw conveyors (KTI) and ice weighing system
could not be inspected physically as these machines / assets were recently purchased by the customer and are yet to
arrive to the site of their operation. The valuation of these assets is conducted on desk-top basis i.e. the valuation of
these assets is based on the information provided by the customer.
5. INSURANCE POLICY
We are not provided with any insurance document hence we are unable to comment on the type and extent of the
insurance coverage.
6. PLANT & MACHINERY APPRAISAL

Methodology
The assets were inspected with regard to their existence, level of maintenance and assessments of the values of the
equipments were carried out on the basis of their present condition. The market value for the machines is obtained on
the basis of buying / selling prices of the machines of similar types and capacities.
Since there is an established secondary market for used / second hand assets related to concrete industry, In case of
used heavy machinery we have adopted the comparable method of valuation by conducting a research on prevalent
prices rather than Depreciated Replacement Cost (DRC) approach.
CONCLUSION:
This report is compiled based on the information received and gathered to the best of our belief, knowledge and
understanding. The information revealed in this report is strictly confidential and issued for the consideration of
owners, their bankers and or their financial consultants.
We trust that this appraisal report fulfils the requirement of your instruction and is issued without prejudice and
liabilities.
Job Ref No. PM/004/10/2014
Page 6 of 10
APE
19 October 2014
7. APPRAISAL VALUE
Market Value of Assets
Our opinion of the Market Value of the assets in their current condition as at
15 October 2014 is approximately: AED 6,370,000/(Six Million Three Hundred and Seventy Thousand UAE Dirhams Only)
Summary of Valuation
S.No
1
2
3
Description
Concrete Batching Plant - 1
Concrete Batching Plant - 2
Accessories
Total
Market Value in AED

1,656,000.00
1,656,000.00
3,058,000.00
6,370,000.00
Yours faithfully
Mr. Simon Gray

Managing Director - MENA
For Chesterton International LLC
Job Ref No. PM/004/10/2014
Page 7 of 10
APE
19 October 2014
Disclaimer
This asset appraisal and report is subject to the following conditions:
i.
The assessors responsibility in connection with this assessment report is limited to the client to whom it is
addressed and to that client only. The assessor disclaims all responsibility and will accept no liability to any
other party.
ii.
The assessment contained herein is given on the basis that the asset is not subject to any unusual or
especially onerous restrictions, encumbrances or outgoings; that the assets and its value is unaffected by any
matters which would be revealed by a local search and replies to usual enquiries, or by any statutory notice;
and neither the assets, nor its conditions, nor its uses, nor its intended uses are, or will be, unlawful; and that
the inspection of those parts which have not been inspected would neither reveal material defects nor cause
the assessor to alter the calculation materially.
iii.
The figures provided within this report for the subject asset and any allocation of values between parts of the
assets applies only in the terms of and for the purpose of this report. The values assessed should not be used
in conjunction with any other assessment, as they may prove incorrect if so used.
iv.
Where the values are provided, they reflect the full contract value and no account is taken of any liability to
taxation on sale or of costs involved in effecting sale.
v.
Any sketch, plan or map in this report is included to assist the reader while visualizing the asset or its
operations; we assume no responsibility in connection with such matters.
vi.
The assessor is not required to give testimony or to appear in court by reason of this assessment report, with
reference to the asset in question, unless arrangement has been made thereof.
vii.
Neither the whole nor any part of this assessment and report or any reference to it may be included in any
published document, circular or statement nor published in any way without our prior written approval of the
form and context in which it may appear.
viii.
Unless stated otherwise information on which this assessment has been based has been supplied to
Chesterton International LLC by the Client and/or the clients approved contractor, this information is believed
to be reliable but we accept no responsibility if this should prove not to be so. In case of information that has
been obtained by our search of the records and examination of documents or by inquiry from the Government
or other appropriate departments, it has been so mentioned
ix.
The report is provided for the stated purpose and for the sole use of yourselves. It is confidential to yourselves
and your client for the purpose to which it relates but may be disclosed to other professional advisors assisting
yourselves in respect of that purpose only. The assessors accept responsibility to you alone that the report
has been prepared with the skill, care and diligence reasonably to be expected of a competent assessor, but
accepts no responsibility whatsoever to any person other than the client. Any other person relies upon the
report at his own risk. Neither the whole nor any part of this report or any references to it may be included in
any published document, circular or statement nor published or reproduced in any way without our written
approval of the form and the context in which it may appear.
x.
All due care and precaution has been exercised in preparation of this report. However, the value quoted may
vary periodically due to various unforeseen factors. It is beyond the scope of our services to ensure the
consistency in values due to changing scenarios.
xi.
In undertaking and executing this assignment, an extreme care and precaution has been exercised. This
report is based on the information supplied by sponsors of the project and the list of inventory prepared by our
engineer. The values may greatly reduce and differ or vary periodically due to various unforeseen factors
beyond our control such as fluctuations in the currencies, replacement values, inflation, local policies and
tariffs, poor maintenance, etc.
xii.
We have not been provided with any previous record of mortgage etc of any equipment valued therefore we
cannot comment on this issue. It should be noted that this valuation is not applicable under liquidation scenario
of the business. It is beyond the scope of our services to ensure the consistency in values due to changing
scenarios.
Job Ref No. PM/004/10/2014
Page 8 of 10
APE
19 October 2014
General Principles
Market Value
This assessment is undertaken in compliance with IVSC International Valuation Application 2 (IVA 2) of the international valuation
standards. The valuation of the subject asset is undertaken on the Market Value basis of valuation which is defined as:The estimated amount for which an asset should exchange on the date of valuation between a willing buyer and a willing seller in an arms
length transaction after proper marketing wherein the parties have each acted knowledgeably, prudently and without compulsion.
PHOTOGRAPHS
ASSETS
Mixer Concrete Batching Plant - 01
Aggregate Storage Bins Plant - 01
Cement Silos Concrete Batching Plant - 01
Control Room
Job Ref No. PM/004/10/2014
Page 9 of 10
APE
19 October 2014
PHOTOGRAPHS
ASSETS
Mixer Concrete Batching Plant - 02
Aggregate Storage Bins Plant - 02
Cement Silos Concrete Batching Plant - 02
Compressors
Wheel Loader
Weigh Bridge
Job Ref No. PM/004/10/2014
Page 10 of 10
Appendix II
Middle East Ready Mix Concrete LLC

Projected Statement of Financial Position
Non-Current assets
Good will
Plant and Machinery
Buildings - Control room, Lab, Security room &
Storage
Furniture & Fixtures
Current assets
Accounts receivable
Other receivables
Cash and bank balances
Total
Shareholders funds
Share Capital
Loans from Shareholders / Associate companies
Reserves and surplus
Non-Current liabilities
Term Loan
Current Liabilities
Accounts Payable
Other payables
In Dirhams
31-Dec-15
31-Dec-16
31-Dec-17
31-Dec-18
1,038,800
6,552,000
21,897,000
1,038,800
7,309,000
20,364,000
1,038,800
8,216,000
18,731,000
1,038,800
8,923,000
16,998,000
124,640
29,612,440
165,580
28,877,380
204,020
28,189,820
239,960
27,199,760
15,145,151
225,000
2,125,271
17,495,422
26,321,227
250,000
5,526,327
32,097,555
28,201,315
300,000
1,493,526
29,994,841
30,081,403
350,000
974,649
31,406,052
47,107,862
60,974,935
58,184,661
58,605,812
300,000
31,195,000
300,000
31,195,000
300,000
18,350,000
300,000
6,422,500
1,833,160
33,328,160
11,691,210
43,186,210
22,377,933
41,027,933
34,135,246
40,857,746
4,281,667
4,281,667
2,446,667
2,446,667
611,667
611,667
9,048,035
450,000
9,498,035
14,742,058
600,000
15,342,058
15,795,062
750,000
16,545,062
16,848,066
900,000
17,748,066
47,107,862
60,974,935
58,184,661
58,605,812
Middle East Ready Mix Concrete LLC

Projected Income Statement
Dec-15
290,000
145,000
61,422,000
Dec-16
504,000
42,000
106,747,200
Dec-17
540,000
45,000
114,372,000
Dec-18
576,000
48,000
121,996,800
22,610,952
810,400
5,451,263
3,434,549
6,189,171
2,785,327
605,133
707,500
3,161,000
208,500
480,000
5,052,085
12,737
149,000
51,657,617
39,296,275
1,408,420
9,473,919
5,969,009
10,756,353
4,840,706
1,051,679
1,217,880
3,426,000
260,712
504,000
6,721,726
12,737
173,808
85,113,223
42,103,152
1,509,021
10,150,627
6,395,366
11,524,664
5,186,471
1,126,799
1,326,510
3,726,000
271,544
529,200
7,057,813
12,737
181,030
91,100,934
44,910,029
1,609,623
10,827,336
6,821,724
12,292,975
5,532,235
1,201,919
1,438,998
4,026,000
282,706
555,660
7,410,703
12,737
188,471
97,111,115
9,764,383
21,633,977
23,271,066
24,885,685
2,144,237
84,600
81,000
83,000
93,360
139,500
192,000
263,500
55,000
24,000
6,000
32,810
85,000
84,500
3,368,507
2,768,845
115,920
85,680
94,500
95,227
178,920
201,600
331,380
63,000
25,200
6,000
42,810
115,920
115,920
4,240,922
2,907,287
125,685
87,394
99,225
97,132
191,835
211,680
353,903
66,150
26,460
6,000
42,810
125,685
125,685
4,466,930
3,052,652
136,137
89,141
104,186
99,074
205,594
222,264
377,849
69,458
27,783
6,000
57,810
136,137
136,137
4,720,221
350,992
3,117,500
340,573
3,809,065
784,945
5,526,360
371,534
6,682,839
824,192
6,039,522
371,534
7,235,249
865,402
6,571,000
371,534
7,807,936
428,931
324,720
753,651
467,925
384,240
852,165
467,925
414,240
882,165
155,975
444,240
600,215
Net Profit after depreciation and interest
1,833,160
9,858,050
10,686,723
11,757,313
Profit before depreciation and interest
5,780,621
14,179,025
15,337,698
16,441,338
324,720
324,720
384,240
384,240
414,240
414,240
444,240
444,240
Production (Qty in M3)

Sales (In Dhs)
Cost of Production
Material cost
- Cement
- D.Sand
- W.Sand crushed
- 10 mm Cr. Agg.
- 20 mm Cr. Agg.
- Superplasticizer
Water
Factory overheads including labour
- Electricity
- Depreciation
- Repairs and maintenance
- Rent, rates and taxes
- Labour cost (Direct)
- Insurance - Buildings and Plant & machiney
- Others
Gross Margins
Administrative overheads
- Staff cost
- Postage and Telephone charges
- Electricity and water charges
- Office maintenenece
- Rent, rates and taxes
- Travelling expenses
- Security guard expenses
- Consultancy charges
- Subscriptions
- Audit fees
- Insurance
- Depreciation
- Miscellaneous expenses
- Printing and stationery
Selling and distribution expenses
- Staff cost
- Fuel expenses & mileage
- Insurance - Trucks and pumps
Finance cost
- Interest charges on USD 1.50 Million loan
- Bank charges - LC, Guarantee and misc
Bank obligations
Term loan installment
Bank charges
Schedule to Projected Financial statements

31-Dec-15
I . Plant and Machinery
- Opening Gross Block (based on val.report)
- Additions made during the year
Total gross block
- Depreciation @ 10% on SLM
- Accumulated depreciation
- Net block
31-Dec-16
4,220,000
3,060,000
7,280,000
728,000
728,000
6,552,000
7,280,000
1,650,000
8,930,000
893,000
1,621,000
7,309,000
2,750,000
1,350,000
31-Dec-17
In Dirhams
31-Dec-18
8,930,000
2,000,000
10,930,000
1,093,000
2,714,000
8,216,000
10,930,000
2,000,000
12,930,000
1,293,000
4,007,000
8,923,000
Details of additions made

- One Containerised Ice water plant, One Flake Ice
plant, Mobile Ice Storage, Ice distribution to
batching plant and Ice Weigher
- Water Treatment plant
- Renovation cost
- Various items
160,000
-
150,000
300,000
2,000,000
2,000,000
24,330,000
24,330,000
2,433,000
2,433,000
21,897,000
24,330,000
1,000,000
25,330,000
2,533,000
4,966,000
20,364,000
25,330,000
1,000,000
26,330,000
2,633,000
7,599,000
18,731,000
26,330,000
1,000,000
27,330,000
2,733,000
10,332,000
16,998,000
IV. Furniture and Fixtures

- Opening Gross Block
Total gross block
- Net block
56,200
75,000
131,200
6,560
6,560
124,640
131,200
50,000
181,200
9,060
15,620
165,580
181,200
50,000
231,200
11,560
27,180
204,020
231,200
50,000
281,200
14,060
41,240
239,960
V. Computers and software

- Opening Gross Block
Total gross block
- Net block
15,000
90,000
105,000
26,250
26,250
78,750
105,000
30,000
135,000
33,750
60,000
75,000
135,000
50,000
185,000
46,250
106,250
78,750
185,000
50,000
235,000
58,750
165,000
70,000
VI. Accounts receivable

- Credit Period (In days)
- Sales (In Dhs)
- Accounts receivable
90
61,422,000
15,145,151
90
106,747,200
26,321,227
90
114,372,000
28,201,315
90
121,996,800
30,081,403
VII. Accounts Payable

- Credit Period (In days)
- Purchases excluding water (In Dhs)
- Accounts Payable
80
41,281,662
9,048,035
75
71,744,681
14,742,058
75
76,869,301
15,795,062
75
81,993,921
16,848,066
450,000
600,000
750,000
900,000
II. Buildings
- Opening Gross Block (based on valuation report)
Total gross block
- Net block
VIII. Other Payables

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A Lakegroup company

BUSINESS PLAN & Feasibility Study

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

06 Marketing and Sales Organisation

07 Management, Personnel and Organisation

08 Technology and Machinery

09 Financial Statements and Forecast

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

01.2 The Factory.

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

03.1 Durable and non-durable Concrete

03.2 High strength Concrete

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Compaction without segregation

Early age strength

Long-term mechanical properties

Long life in severe environments

Depending on its implementation, environmental

03.4 Ultra - High Performance Concrete (Grey & Colored)

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

no need for vibrators to compact the concrete

no bleeding, or aggregate segregation

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

06 Marketing and Sales Organisation.

Reduction of set-up time for classic kinds of building construction.

Increased site safety.

Project cost reduction.

Quality construction and a new kind of technology used.

Middle East Ready Mix LLC

BUSINESS PLAN & FEASIBILITY STUDY

Review of structural plans.

The overall marketing plan should based on the following fundamentals: