DIGEST 96SEE WHAT’S NEW AND NOTEWORTHY IN PRIVATE EQUITY THIS WEEK /// ISSUE 96May 24, 201312Green for Go: Outlook for InternationalInvesting Based on Market PsychologyBillion Dollar Internet Security SoftwareBuyoutMiddle East Asset Managers Allocate Moreto PE in 2013; Invesco StudyPrivate Equiteers Moving to Family OfficesTop 10 Technology Deals in 2013Quote of the Week: Hitting a BRIC Wall3
1www.DealMarket.com/digestBILLION DOLLAR INTERNET SECURITYSOFTWARE BUYOUTThis week’s deal of the week looks to be a USD 1 billion buyout by Vista Equity Partners which islooking to acquire Websense, an American maker of software and services designed to help protectcompanies against cyber-attacks and data theft, according to the WSJ. The take-private transaction ismeant to improve the competitive standing of the security software company.Image source: MarketPsych DataGREEN FOR GO: OUTLOOK FORINTERNATIONAL INVESTING BASED ONMARKET PSYCHOLOGYThe countries that are looking attractive for investment include Russia and Pakistan, according to aspecial report from MarketPsych Data provided to DealMarket Digest this week. The chart shows thelatest market outlook based on a range of indicators tracked by MarketPsych. Green-hued countriesrepresent strength and are targets for currency, stock, and equity investments, according to the dataprovider, while orange-hued countries represent weakness and should be sold or avoided. Theinformation and data are useful for PE investors, according to Richard L. Peterson of MarketPsychData, because it can help investors avoid "bubbly" markets and buy into depressed ones that areabout to reverse.
2www.DealMarket.com/digestPRIVATE EQUITEERS MOVING TO FAMILYOFFICESFamily offices and private equity firms may soon be competing with each other for investmentmanagers, according to an article about family office trends in Business Insider. In recent times as aresult of a greater interest in PE investment, family offices have begun to tap existing private equityprofessionals to source opportunities, conduct thorough due diligence, negotiate transactions, andwork with the acquired companies. PE pros are attracted, according to the article, because the PEindustry is changing in response to tax questions and realization of carry so that the idea of workingfor an office under a more flexible policy becomes more attractive.Major sovereign governments and sovereign wealth funds (SWFs) in the Middle East are increasinglyconsidering new private equity models for investment, according to the fourth annual Invesco MiddleEast Asset Management Study. Allocation to PE has increased by 8% on average over the past threeyears, according to the 2013 study. Nearly all SWFs started out investing into funds but many havemoved (or are considering a move) to co-investment or direct models. The report also says Co-investment is the logical next step for an SWF of material size looking to increase its exposure orreduce costs or liquidity risk. Meanwhile, direct operations are attractive to those who feel they cancompete with private equity firms or want to access particular strategies not aligned to the largeprivate equity houses.Image source: Invesco Middle East AssetManagement StudyMIDDLE EAST ASSET MANAGERSALLOCATING MORE TO PE IN 2013;INVESCO STUDY
3www.DealMarket.com/digest10 TECHNOLOGY DEALS IN 2013New data from Internet DealBook, whichtracks M&A and PE investment in technologycompanies, shows that the top deal of 2013until end April is the acquisition of MountainCablevision by Rogers Communications forUSD 710 million. In the meantime,technology related transactions are mountingup. Yahoo acquired social media startupTumbler for USD 1.1 billion, accordingvarious sources, including the WSJ. And as wereported above, Vista Equity Partners isaiming to take Websense private in asimilarly sized deal.Other significant transactions this yearinclude a direct investment in an Asia-Pacificstartup called 360Buy by institutionalinvestors Ontario Teachers’ Retirement Fund,Kingdom Holding. As for the M&A side, Ciscohas been busy with two deals, and Alibabaand Cadence with one deal each.QUOTE OF THE WEEK: PE MINING FORDEALS“I haven’t seen anything like it in more than 20years…Mining companies have done pretty well buyingassets at the bottom of the cycle and turning some overnear the top, but this is completely the other wayaround.”Who said it: Tim Schroeders of Pengana Capital inMelbourne in a Bloomberg interviewIn Context: Mining asset disposal could be a big target forPE funds as a bear market encourages sell offs, accordingto Schroeders. Mining companies are holding “the biggestImage source: Internet DealBookever sale of assets this year”. About USD 48 billion of mines and assets are on offer, almost double lastyear’s USD 23 billion of completed and pending deals. Private equity firms have raised almost USD 9billion in the past 16 months for mine investment, according to data compiled by Bloomberg, whichmeans that PE funds could be financing quite a few mining projects in the coming years.Where we found it: Bloomberg
DealMarketDealMarket launched in 2011 and is growing fast. Just one year afterlaunch, DealMarket counts more than 61,000 recurring users from 154countries, and over 3,000 deals and service providers promoted or listedon the platform.DealMarket is an online platform enabling private equity buyers, sellersand advisors to maximize opportunities around the world – a one-stopshop for Private Equity professionals. Designed by Private Equityprofessionals for Private Equity professionals, the platform is easy to use,cost effective and secure, providing access, choice and control across theinvestment cycle.DealMarket’s offering includes• DealMarketPLACE, an unfiltered view of the global deal and advicemarketplace, where searching is free and postings are the price of acappuccino a day (with no commission).• DealMarketSTORE offers affordable access to industry-leading third-partyinformation and services on demand; and• DealMarketOFFICE is a state-of-the-art deal flow management tool,helping Private Equity investors to capture, store, manage and sharetheir deal flow more efficiently.DealMarket was voted the “Best Global Private Equity Platform for 2013”by Corporate Newswire.www.DealMarket.comThe Dealmarket Digest empowers members of Dealmarket by providingup-to-date and high-quality content. Each week our in-house editor siftsthrough scores of industry and academic sources to find the mostnoteworthy news items, scoping trends and currents events in the globalprivate equity sector. The links to the sources are provided, as well as aneditorialized abstract that discusses the significance of the articlesselected. It is a free service that embodies the values of the Dealmarketplatform delivers: Professional, Accessible, Transparent, Simple, Efficient,Effective, and Global.To receive the weekly digest by email register on www.dealmarket.com.Editor: Valerie Thompson, Zurich