LAUNCH OF THE SHARE CAPITAL INCREASE TO SUPPORT GROWTH PLAN

The Company's new business plan has been approved: further opportunities for growth and increased profitability

Proposal to the Extraordinary Shareholders Meeting to resolve on a Rights Offering for a maximum total amount of Euro 400 million fully guaranteed by a pre-underwriting agreement with Jefferies and Morgan Stanley

The Extraordinary Shareholders' Meeting will also be called upon to renew the authorization granted to the Board of Directors to increase the share capital up to 10% of the share capital existing at the time of exercising the authorization, with the exclusion of option rights

The Extraordinary Shareholders’ Meeting will be held on October 23, 2025.

Colleferro (Rome), 12 September 2025 -The Board of Directors of Avio S.p.A. (“Avio” or the “Company”), held on 11 September, has unanimously approved the Company’s new business plan and to submit to the Extraordinary Shareholders’ Meeting, to be called on October 23, 2025, the proposal of a share capital increase, in one or more tranches and against payment in cash of a maximum total amount of Euro 400 million (including any share premium), through the issue of ordinary shares with no nominal value, with the same characteristics as those in circulation, to be offered with pre-emption rights to the Company's shareholders in proportion to the number of shares held, pursuant to Article 2441, paragraph 1, of the Italian Civil Code (the “Rights Offering”). As per standard practice, it is proposed that the Extraordinary Shareholders’ Meeting grant the Board full authority to define the terms and conditions of the Rights Offering, including the issue price, any share premium, the final amount of the Rights Offering, and the number of newly issued shares to be offered to shareholders, with the discretion to determine the timing of the Rights Offering.

The acceleration of growth opportunities in the space and defense markets in Europe and the United States will require the strengthening of the Company’s production capacity, both in Italy and in the United States, together with greater vertical integration.

In defense, investments in new propulsion technologies and production assets will be combined with Avio’s development project in the United States, focused on the construction of a new plant that will be operational by the end of 2028 and will produce solid propellant engines to serve more customers. 

In the space sector, Avio, provider and operator of the Vega launch service, will continue to benefit from market dynamics, which currently forecast an average annual growth rate between 2024 and 2034 (in terms of tonnes launched into orbit) of around 10%, increasing the flight cadence of Vega C and evolving its launcher platform with Vega E, as well as supplying propellants for Ariane launchers. 

In particular, in the defense sector, the opportunity for Avio is to increase its presence in a rapidly accelerating market, whose supply chain requires the Company’s consolidated know-how in solid rocket motors (SRMs) and additional production capacity that can be financed with new capital. In the United States in particular, the company aims to help bridge the current gap between SRM supply and demand by gaining market share in a Total Addressable Market that is currently worth approximately $1.7 billion and is expected to grow at a rate of 8% by 2030. 

Leveraging the opportunities presented, the new business plan envisages that Avio’s turnover and EBITDA will grow at an average annual growth rate of approximately 10% and over 15% respectively over the next ten years.

In the context of the Rights Offering, Jefferies and Morgan Stanley, which will act as Joint Global Coordinators and Joint Bookrunners, have entered today into a pre-underwriting agreement with Avio pursuant to which they have undertaken, on the terms and subject to the conditions set forth therein and in line with market practice for similar transactions, to enter into an underwriting agreement for the subscription of any newly issued shares that remain unsubscribed at the end of the auction period of the Rights Offering. As per standard practice, the underwriting agreement relating to the Rights Offering will be entered into, subject to the occurrence of the conditions envisaged by the aforementioned pre-underwriting agreement, immediately before the launch of the pre-emptive rights offering, as soon as the Board of Directors has defined the final terms thereof.

It is expected that the Rights Offering will be completed by the end of the year, subject to the approval by the Extraordinary Shareholders Meeting, market conditions and the obtainment of the necessary authorizations by the competent authorities.

Avio has also initiated various procedures in the United States to apply for various federal and state financing solutions, including non-repayable grants, made available from funds allocated at various levels with the aim of strengthening the country’s industrial base in the defense sector. 

The Extraordinary Shareholders’ meeting will also be called upon to renew the delegation of powers to the Board of Directors, pursuant to Article 2443 of the Italian Civil Code, to increase the share capital with the exclusion of pre-emption rights pursuant to Article 2441, fourth paragraph, second section, of the Italian Civil Code, in one or more tranches and against payment in cash, within the limit of 10% of the share capital existing at the time of the delegation (excluding any share premium), as well as within the limit of 10% of the total number of shares of the Company existing at the time of the exercise of the delegation (the “Reserved Capital Increase”). In this context, the delegation will allow the Board itself to determine the terms of the further capital increase – including the maximum number of newly issued shares and the related subscription price – based on the market conditions prevailing at the time of the actual launch of the transaction.

The call notice shall be published in the Investors section of the company website and on "eMarket STORAGE" storage mechanism (www.emarketstorage.com), where also the explanatory reports of the Board of Directors regarding the proposals on the Rights Offering and the Reserved Capital Increase, pursuant to art. 125-ter of Legislative Decree no. 58/1998, will be made available, within the terms of the law.

As part of the Rights Offering, Avio is assisted by Chiomenti and Sullivan & Cromwell as legal advisors, while Jefferies and Morgan Stanley are assisted by White & Case as legal advisor.

DISCLAIMER

This document is not an offer to sell or a solicitation of offers to purchase or subscribe for shares. This announcement is an advertisement and not a prospectus within the meaning of the Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (the “Prospectus Regulation”) and not a prospectus under any other applicable laws. Copies of this document may not be sent to jurisdictions, or distributed in or sent from jurisdictions, in which this is barred or prohibited by law. The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, in any jurisdiction in which such offer or solicitation would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any jurisdiction. 

This document does not constitute an offer or invitation to subscribe for or purchase any securities in such countries or in any other jurisdiction into which the same would be unlawful. This document may not be published, distributed or transmitted in the United States, Canada, Australia or Japan. These materials do not constitute an offer of securities for sale or a solicitation of an offer to purchase securities (the “Securities”) of Avio S.p.A. (the “Company”) in the United States or any other jurisdiction in which such offer or solicitation is not authorised or to any person to whom it is unlawful to make such offer or solicitation. The Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the “Securities Act”).  The Securities have not been, and will not be, registered under the Securities Act. There will be no public offer of securities in the United States.

In the United Kingdom, this document is only being distributed to and is directed only at qualified investors, within the meaning under Article 2(e) of Regulation (EU) 2017/1129 as it forms part of English law by virtue of the European Union (Withdrawal) Act 2018 as amended, who are also (i) persons who are investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (ii) high net worth entities, or other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order, (all such persons together being referred to as “relevant persons”). The Securities are only available in the United Kingdom to, and any invitation, offer or agreement to purchase or otherwise acquire the Securities will be engaged in only with, the relevant persons. Any person in the United Kingdom that is not a relevant person should not act or rely on this communication or any of its contents.

In any member state of the European Economic Area and the United Kingdom (each a “Relevant State”) that has implemented Prospectus Regulation, this document is only addressed to qualified investors in that Relevant State within the meaning of the Prospectus Regulation (also in the United Kingdom, ae it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018).

This document may contain specific forward-looking statements, e.g., statements including terms like "believe", "assume", "expect", "forecast", "project", "may", "could", "might", "will" or similar expressions. Such forward-looking statements are subject to known and unknown risks, uncertainties and other factors which may result in a substantial divergence between the actual results, financial situation, development or performance of the Company and those explicitly or implicitly presumed in these statements. Against the background of these uncertainties, readers should not rely on forward-looking statements. The Company assumes no responsibility to up-date forward-looking statements or to adapt them to future events or developments.

Except as required by applicable law, the Company has no intention or obligation to update, keep updated or revise this publication or any parts thereof following the date hereof.

Jefferies GmbH and Morgan Stanley & Co. International plc (the “Managers”) or their respective subsidiaries, affiliates, or their respective directors, officers, employees, advisors, agents, alliance partners or any other entity or person accepts any responsibility or liability whatsoever, or makes any representation, warranty or undertaking, express or implied, as to the truth, accuracy, completeness or fairness of the information or opinions contained in this announcement (or whether any information has been omitted from the announcement) or any other information relating to Avio, its subsidiaries or affiliates, whether written, oral, visual or electronic form, and in any manner transmitted or made available, or for any loss in any way arising from any use of this announcement or its contents or otherwise arising in connection therewith. Accordingly, each of the Managers and the other persons mentioned above disclaim, to the fullest extent permitted by applicable law, all and any liability, whether arising from tort or contract, or otherwise, in connection with this announcement and/or any such statement.

The Managers are acting exclusively for the Company and no one else in connection with the Rights Offering. They will not consider any other person as their respective client in relation to the Rights Offering and will not be liable to anyone other than the Company for the protection offered to their respective clients, nor for advice in relation to the Rights Offering, the content of this announcement or any transaction, arrangement or other matter referred to herein.

Except as required by applicable law, the Company has no intention or obligation to update, maintain, or revise this publication or any part thereof after the date hereof.