• PPK Group Ltd enters conditional share sale agreement to sell 39.85% stake in CIB to Mehler Vario Systems GmbH
• Total proceeds of up to A$33.43m, including A$27.45m purchase price and potential A$5.98m earn-out
• Completion subject to customary and transaction-specific conditions, expected by 30 June 2026

PPK Group Limited (ASX:PPK) has announced that it has entered into a binding, conditional share sale and purchase agreement (SPA) with Mehler Vario Systems GmbH (Mehler) to sell its 39.85% interest in Craig International Ballistics Pty Ltd (CIB). Under the terms of the SPA, Mehler will acquire the entirety of PPK's stake in CIB, held through its wholly owned subsidiary BNNT Ballistics Pty Ltd. The total purchase price is based on a headline enterprise value for 100% of CIB of A$86 million on a cash-free/debt-free basis, with no post-completion working capital adjustment. The total proceeds to PPK could be up to A$33.43 million, comprising a headline purchase price of A$27.45 million and a potential earn-out capped at A$5.98 million. The earn-out is contingent on CIB achieving an 'Average Adjusted Recurring EBITDA' of greater than A$12.0 million per year over calendar years 2026 and 2027. Completion of the SPA is subject to the satisfaction or waiver of both customary and transaction-specific conditions precedent, including entry into ancillary transaction documents, finalisation of the warranty and indemnity insurance, and receipt of required approvals. Completion is expected to occur no later than 30 June 2026. PPK intends to use A$2.0 million of the cash proceeds at completion to repay a third-party loan secured over part of the company's stake in CIB. Any decisions around potential dividends to shareholders will be considered closer to year-end. Mehler is a leading global company specialising in armour ballistic protection, headquartered in Fulda, Germany, with over 40 years of industry experience and more than 1,500 employees worldwide.

PPK continues to undertake a strategic review of its portfolio of investments to identify the most effective pathways to maximise value for shareholders. Over the last 2 years, the company has sold its investment in AMAG, sold down and deconsolidated its investments in Li-S Energy and White Graphene group, invested further in PowerPlus Energy, and is now, subject to completion, disposing of its investment in CIB.