0
Multiple

Private Equity
Transaction Advisory Services
Issue 1
2014

Completing the cycle
The buyout market gave a steady ...
Welcome

About Multiple
Multiple is a quarterly publication summarizing trends in buyouts* across Europe.
EY and Equistone...
Contents
4	

2014 outlook

5	

2013 in headlines

6	

Pipeline prospects 

7	

Current conditions

9	

Deal dynamics

11	 ...
2014 outlook
Megadeal trend will continue
•	 A healthy pipeline suggests there will be an increase in the
number of €1b-pl...
2013 in headlines
Springer was the largest buyout of 2013
•	 BC Partners agreed to buy Springer Science  Business Media

f...
Pipeline prospects
The 2013 recovery in the buyout market looks like it will be sustained in 2014. The new year will
get o...
Current conditions

0

2010
Total number

2011

2012

Q4

€m

5,000

Q3

50

Q2

10,000

Q1

100

Q4

15,000

Q3

150

Q2
...
Current conditions (continued)
Largest European buyouts 2013
Vendor

Germany

Ista

8

BC Partners

EQT Partners

3,300

A...
Deal dynamics
By value, secondary buyouts remain significantly more popular
than other sources of transactions. This area ...
Deal dynamics (continued)
Largest European exits 2013
Company name

Country

Merlin Entertainments Group

UK

Springer Sci...
Market watch
Manufacturing
The 156 deals in the manufacturing sector
accounted for more than €12.5b of value in
2013. The ...
Country spotlight
UK

Q4: 45 deals €3.5b
2013: 188 deals €16.2b
While remaining the most active in Europe by value and vol...
Country spotlight (continued)
Germany

Q4: 18 deals €646m
2013: 67 deals €12.1b
The German buyout market can now be said t...
Country spotlight (continued)
France

Q4: 16 deals €472m
2013: 96 deals €6.6b
France’s total combined value for 2013 was d...
CMBOR methodology
The data only includes the buyout stage of the PE market (management buyout (MBO),
management buy-in (MB...
Contacts
Sachin Date
EMEIA Private Equity Leader
+ 44 20 7951 0435
sdate@uk.ey.com

Country contacts:
Marc Guns
Belgium
+ ...
Further insights
2014 APAC PE outlook report

Credit Markets 2013–2014

Capital Insights

The APAC PE market is robust, an...
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Ey multiple-issue-1-2014

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In our latest issue of Multiple, our European PE report based on the latest data from the Centre for Management Buyout Research (CMBOR), we reveal the value of PE-backed IPOs and secondary buy-outs increased in 2013, but, due to the lack of activity from European corporates, trade sales dropped. 2014 needs the return of the corporate buyer to complete the deal cycle.

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Transcript of "Ey multiple-issue-1-2014"

  1. 1. Multiple Private Equity Transaction Advisory Services Issue 1 2014 Completing the cycle The buyout market gave a steady performance in 2013 but it was in the exit market that we saw an improved level of return to investors. The value of IPOs and secondary buyouts increased in 2013, but trade sales dropped. 2014 needs the return of the corporate buyer to complete the deal cycle. Enter
  2. 2. Welcome About Multiple Multiple is a quarterly publication summarizing trends in buyouts* across Europe. EY and Equistone Partners Europe are proud to sponsor the Centre for Management Buyout Research (CMBOR), whose data is analyzed in Multiple. The following analysis and commentary is based on research recorded by CMBOR. Countries covered: Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Hungary, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Romania, Spain, Sweden, Switzerland, Turkey and the UK. * uyouts: CMBOR defines buyouts as over 50% of shares changing ownership with management or private equity, or B both having a controlling stake upon deal completion. Equity funding must primarily be from private equity funds and the bought-out company must have its own financing structure, e.g., management buyout (MBO) or management buy-in (MBI). For full details on the CMBOR methodology, please refer to page 15. Multiple January 2014 | 2
  3. 3. Contents 4 2014 outlook 5 2013 in headlines 6 Pipeline prospects 7 Current conditions 9 Deal dynamics 11 Market watch 12 Country spotlight 16 Contacts 17 Further insights “ he European PE market has seen a sustained recovery over the past year and the T outlook for 2014 is upbeat as confidence continues to grow. The total value of exits has surpassed new deal values and the IPO market has been the real hero in 2013. While secondary buyouts have remained steady, the lack of activity from European corporates has been disappointing. “ s economic prospects continue to improve, the PE market is clearly making the most A of the good conditions for exiting and returning capital to investors. However, it will need to be more innovative, looking further afield in its hunt for both new investment opportunities and corporate buyers, if it is to continue to deliver the strong returns it has historically been able to achieve.” Sachin Date, Europe, Middle East, India and Africa (EMEIA) Private Equity Leader, EY The data in this report was captured on 7 January 2014. Multiple January 2014 | 3
  4. 4. 2014 outlook Megadeal trend will continue • A healthy pipeline suggests there will be an increase in the number of €1b-plus deals in the coming 12 months. IPOs will continue to offer viable exit route • A number of portfolio companies are already planning IPOs for 2014, as the backlog of exits will continue to clear. Fund-raising will drive more deals • PE houses will be able to raise more funds as investors seek higher yields and exits continue, following a successful fund-raising year in 2013. Non-European investors continue buying spree • US and Asian investors will continue to be attracted to Will European corporates rejoin the market? • The dearth of corporate buyers in the exit market is arguably putting a brake on full recovery, as investors need to be able to explore all avenues as they seek to clear their portfolio overhang. While the return of the IPO market is very welcome, corporates need to play their part as well in 2014. European assets as economic recovery begins to bed in. That said, the speed of this recovery may differ between the individual economies. IPO market summary IPO activity • 2013 was a record year for IPO by volume since 2007 for some markets. However, many other markets were still impacted by the financial crisis. • Size matters(ed): 2013 saw many visible and large PE-backed IPOs. IPO markets • Mixed IPO weather conditions across EMEIA. • General sentiment was impacted by monetary policy of Dr. Martin Steinbach EY IPO Leader EMEIA ECB/FED, country economic outlooks, selection index levels and low(est) interest rates. Sectors • 2013 was the year of real estate IPOs. • In 2014, the technology sector is expected to make a comeback. • A shift from value to growth investments is expected on the investor side, as there is much liquidity looking for return by investing and taking more risk appetite IPO activity. Sustainable in 2014? • Sentiment has improved every quarter in FY13, with a positive outlook for 2014. • There were record highs (i.e., FTSE, DAX) in some EMEIA selection indices and very low volatility (i.e., VDAX, VSTOXX) feed IPO activity despite moments of crisis. • Investor votes in the EY IPO survey, with regard to country appetite, showed UK and Germany as prime investment locations in EMEIA sectors. Multiple January 2014 | 4
  5. 5. 2013 in headlines Springer was the largest buyout of 2013 • BC Partners agreed to buy Springer Science Business Media for €3.3b from EQT in a secondary buyout that was the largest PE-backed acquisition in Germany for seven years. IPO market returned to life • There were some 20 exits made through initial public offerings (IPOs) during the year, raising more than €25b during the year, the highest total value ever recorded. In 2012, there was only one IPO. Germany claimed the largest buyouts of the year • Out of the nine €1b-plus buyout deals of 2013, four were German, while only two were from the UK. The four German deals happened to be the four largest during the year as well. Lowest level of megadeals since 2009 • The nine €1b-plus deals in 2013 had a combined total of just under €15b, making 2013 the quietest year for megadeals since the low of 2009. Confidence remained fragile, but Eurozone fears abated • The year began with fears that the financial crisis in Cyprus could spread to other Eurozone economies, but such fears proved unfounded as the zone stabilized during the year. Even so, non-Eurozone countries appeared to remain attractive to outside investors. Post-crisis deals began to exit • By the end of 2013, seven of the top 20 exits were from post-2009 deals, showing that PE has been able to buy at good prices and weather poor market conditions to grow their assets and successfully exit in a three- to five-year period. Deal: Largest UK deal in 2013 (BM Retail, €1.2b) Exit: One GmbH/Orange €1.3b (trade sale) Deal: Largest Norwegian deal in 2013 (Aibel, €1.2b) Exit: Taminco €1b (IPO) Deal: Largest Dutch deal in 2013 (Mediq, €0.8b) Exit: Dematic €0.8b (secondary) Jan Feb Deal: Largest deal of the month (Cabot Financial, €0.9b, UK) Exit: Constellium €1.4b (IPO) Mar Q1 2013 Deal: Largest Italian deal in 2013 (Cerved Business Information, €1.1b) Exit: Esure Insurance €1.4b (IPO) Stat: Retail becomes highest valued sector in Q1 2013 (€3.8b), overtaking manufacturing (€2.8b) Slow start, but still all to play for Deal: Largest Spanish deal in 2013 (Befesa, €1.1b) Largest French deal in 2013 (Allflex, €1b) Exit: Ista €3.1b (secondary) Apr May Jun Q2 2013 Deal: Largest Danish deal in 2013 (Unifeeder, €0.4b) Exit: Stille Linde/Kion €2.4b (IPO) Stat: European buyout market reaches €21.8b in first half of year Attracting interest Deal: Largest Swiss deal in 2013 (Archroma, €0.4b) Exit: The Colomer group €0.5b (trade sale) Deal: Largest Austrian deal in 2013 (AHT Cooling Systems, €0.6b) Exit: Merlin Entertainments €3.8b (IPO) Deal and exit: Largest German deal and exit in 2013 (Springer Science Business Media, €3.3b) Jul Aug Sep Q3 2013 Deal: Largest deal of the month (CeramTec, €1.5b, DE) Exit: Gambro € 3.1b (trade sale) Stat: Refinancings hit highest level (€31.6b) since 2007 Rising up Oct Nov Dec Q4 2013 Deal: Largest Finnish deal in 2013 (Terveystalo, €0.7b) Exit: Moncler €2.6b (IPO) Stat: IPO market reaches highest value ever (€25b) by end of 2013 Completing the cycle Multiple January 2014 | 5
  6. 6. Pipeline prospects The 2013 recovery in the buyout market looks like it will be sustained in 2014. The new year will get off to a strong start, with a number of large deals set to complete in the first quarter of the year. These include Scout24, Germany’s largest property and dating portal owned by Deutsche Telekom, which will be acquired by US PE firm Hellman Friedman in a deal valued at €1.8b (Bloomberg); and 3i’s investment in Scandlines, a Baltic Sea ferry operator, valued at €1.3b (3i press release). In the UK, we will see the completion of CVC’s acquisition of domestic appliance insurance group Domestic General, with a value of €750m (CVC press release). And US investor Corsair’s acquisition of 314 RBS bank branches will see the return of the Williams Glynn bank brand when the €710m deal (ft.com) completes. The exit pipelines also remain healthy. Japan’s Lixil and the Development Bank of Japan are set to acquire bathroom fitting maker Grohe in a €3b deal. The deal will mark the largest investment made by a Japanese company in a German rival (ft.com) and provide an exit for TPG Capital. The deal pipeline suggests the IPO exit route will remain popular. Companies, such as UK’s discount retailer Poundland, are said to be planning a flotation during 2014 (telegraph.co.uk). Food can maker Mivisa Envases is set to be acquired by US consumer goods packaging manufacturer, Crown Holdings, in a €1.2b deal that will see Blackstone achieve an exit from the company. Pipeline €12b from 17 deals “Private equity has entered 2014 feeling more optimistic than it has done for a number of years. This optimism partly stems from the reopening of the IPO window. While public listings have been a viable exit route in the US for some 18 to 24 months, it has only been in the last year that IPO investors have begun welcoming new issues from Europe’s listed companies. PE has been quick to capitalize on this shift in sentiment.” Sachin Date EMEIA Private Equity Leader, EY Multiple January 2014 | 6
  7. 7. Current conditions 0 2010 Total number 2011 2012 Q4 €m 5,000 Q3 50 Q2 10,000 Q1 100 Q4 15,000 Q3 150 Q2 20,000 Q1 at more than €100m, debt accounted for 51%, while equity dropped to 42%, the lowest since 2007. 200 Q4 Debt rises to the highest ratio since 2007 • 2013 marked the first time that the debt ratio in deals rose above 50% since 2007. In deals valued 25,000 Q3 as the largest buyout market by value in Europe (€16.2b). However, by volume, the UK market continued its dominance, with 188 deals during the year. France was the second-busiest market, with 96 deals. 250 Q2 Germany challenges UK dominance • The German buyout market saw €12.1b of deals in 2013, seriously challenging the UK’s position European buyouts — volume and value Q1 highest ever value, and the largest number since 2007’s 34 IPOs. This performance reflects the context of the equity markets as a whole, which returned to favor for investors during 2013. Investors have been able to recognize the underlying quality of assets coming to market at good prices. Such businesses are well run, with transparent governance, and can look to equity investors for the next stage of their growth. Q4 • The exit hero in 2013 has been the IPO — 20 flotations during 2013 raised more than €25b, the improving conditions in the debt market. This refinancing performance was the best since 2007, suggesting that the finance markets are open, with banks racing to be competitive. However, one should sound a note of caution, as quantitative easing tapering could have an impact during 2014. Q3 suggesting that PE houses are making headway with their backlogs of portfolio companies. In 2013, there were 393 exits, raising nearly €76.5b for investors. Secondary buyouts raised the highest value (€30.5b), while trade sales were the most popular (175 trade exits). The largest exit of the year was the flotation of Merlin Entertainments Group. Refinancing value improves • Some €43.1b of debt was refinanced during 2013, significantly up on the €24.6b of 2012, reflecting Q2 Exits outstrip buyouts • The value of exits during 2013 surpassed the value of new deals for the fourth year running, invested. Buyout firms currently have more than US$391b in capital available to fund new deals, up 10% relative to the end of 2012. These funds will need to find a home in 2014, so could lead to an increase in buyout activity or else they could put a brake on further fund-raising activity. Globally, 2013 was the best year for PE fund-raising since 2008. Firms raised a collective US$401b, well above the US$341b they raised in 2012. Q1 close to matching 2012’s levels. It was a similar story in terms of volume; at 539, the number of deals was again the lowest since 2009. The figures were disappointing in the light of a strong third quarter of the year, with €20.6b of deals, compared with €9.9b in the fourth quarter. And at 121, the fourth quarter was the least active in terms of number since Q4 2009. Increase in “dry powder” • 2013 saw an uptick in the levels of “dry powder” — existing funds available at PE houses to be Total number Value and volume down in 2013 • With a total value of €52.3b, the buyout market in 2013 was the lowest since 2009, although 0 2013 Total value (€m) Source: CMBOR, Equistone Partners Europe, EY — year 2013 to end Q4 only Multiple January 2014 | 7
  8. 8. Current conditions (continued) Largest European buyouts 2013 Vendor Germany Ista 8 BC Partners EQT Partners 3,300 Actual Germany 7 CVC Capital Partners Charterhouse Capital 3,100 Actual Douglas Holding Germany 1 Advent International Public-Private 1,498 Actual CeramTec Germany 9 Cinven Rockwood Holdings (USA) 1,490 Actual Aibel Norway 4 Ratos and Ferd Capital Partners Ferd Private Equity 1,165 Actual B M Retail UK 1 Clayton Dubilier Rice Private — Arora family 1,147 Actual Cerved Business Information Italy 3 CVC Capital Partners Bain Capital and Clessidra 1,130 Actual Vue Entertainment UK 8 Alberta Investment and OMERS PE Doughty Hanson 1,094 Actual Befesa Spain 7 Triton Advisers Abengoa 1,075 Actual Allflex France 7 BC Partners Motion Equity 985 Actual Cabot Financial UK 5 JC Flowers AnaCap 944 Actual David Lloyd Leisure UK 12 TDR Capital London Regional Group Holdings 900 Actual RR Ice Cream/R R UK 7 PAI Partners Oaktree Capital 831 Actual Mediq NV (AL Garden) Netherlands 2 Advent International Public-Private 819 Actual EWOS Norway 10 Bain Capital and Altor Equity Partners Cermaq 805 Actual Dematic Holding Belgium 2 AEA Investors and Teachers Private Capital Triton Beteilungsberatung 800 Estimated Intertrust Group Switzerland 4 Blackstone Group Waterland Private Equity 675 Actual Ansaldo Energia Italy Fondo Strategico Italiano Finmeccanica 657 Actual SMCP/Sandro/Maje/Claudie Pierlot France 6 Kohlberg Kravis Roberts L Capital 650 Estimated Maisons du Monde France 8 Bain Capital LBO/Apax 650 Estimated 12 Value (€m) Value type H1 2013 Investor 275 deals €22b H2 2013 Springer Science Business Media Deal month 264 deals €30b 2013 Country 539 deals €52b 2012 Company name 590 deals €54b Source: CMBOR, Equistone Partners Europe, EY — year 2013 to end Q4 only Multiple January 2014 | 8
  9. 9. Deal dynamics By value, secondary buyouts remain significantly more popular than other sources of transactions. This area accounted for nearly €31.2b of deals during 2013. Local divestment and private sales were the second and third most popular sources. However, by value, at €7.9b and €6.8b respectively, they were some way off that of the secondary buyout market. For the first time since 2007, debt accounted for more than 50% of the deals in the €100m-plus range. At 51%, the level of debt was notably higher than the 38.4% recorded in 2012. At the same time, the equity ratio in this bracket fell from 59.1% in 2012 to 42% in 2013. Mezzanine finance accounted for 4.5% of deal value in 2013, with loan note and other financing making up the remaining 2.5%. Mixed story in terms of deal sizes There were 133 deals in the mid-market range (deals with a value of between €50m and €500m) during 2013, down from 146 in 2012, and there were 16 deals in the €500m to €1b bracket, similar to the volume of deals in 2012. The combined deal values for each segment was broadly similar between 2012 and 2103, suggesting investors remained committed to their involvement in such deals. The four largest deals were all based in Germany, the largest of which was Springer Science Business Media. There were no €1b-plus deals in the fourth quarter of the year, although David Lloyd Leisure in the UK was close, with a value of €893m. Deal size 2012 2013 Q3 2013 Q4 2013 €1b-plus 13 9 5 0 €500m–€1b 16 16 4 6 €100m–€500m 75 79 20 486 435 114 95 Total number of deals 590 539 143 “ ith MA volumes remaining low, most of the W transactions we supported in the early part of the year related to growth capital, refinancing and dividend recapitalizations. The dynamic has begun to shift in the last quarter, as corporates use cash and liquidity to seek MA opportunities. “ e are very excited about 2014. We believe credit W markets will remain healthy, with the acquisitions cycle beginning to find swagger. Corporates with a clear credit proposition should find great support across the debt markets in 2014.“ 20 Up to €100m “t was a great year for the credit markets. We I saw very healthy banking and capital markets, debt funds continuing to raise substantial sums of capital ready for deployment, retail bond markets continuing to mature, strong structured finance issuance and credit market support mechanisms, such as Funding for Lending, really making their presence felt. 121 Chris Lowe, Debt and Capital Advisory Partner, EY, UK For more information visit ey.com/uk/cdainsights Multiple January 2014 | 9
  10. 10. Deal dynamics (continued) Largest European exits 2013 Company name Country Merlin Entertainments Group UK Springer Science Business Media Deutschland Germany Ista Exit month Exit value (€m) Vendor Investor Blackstone Group Flotation 3,816 Flotation 8 EQT Partners BC Partners 3,300 Secondary buyout Germany 7 Charterhouse Capital Partners CVC Capital Partners 3,100 Secondary buyout Gambro Sweden 9 Investor AB and EQT Partners Baxter International Inc (USA) 3,059 Trade Sale Numericable/Altice One/Coditel Belgium 11 Cinven Flotation 3,000 Flotation Moncler Italy 12 Carlyle Group Flotation 2,550 Flotation Stille Linde/Kion Germany 6 KKR Flotation 2,392 Flotation Partnership Assurance/Partnership Group Holdings UK 6 Cinven Flotation 1,802 Flotation European Oxo/Oxo Group/Oxea Germany Advent International Oman Oil company 1,800 Trade Sale Esure Insurance UK 3 Motion Equity and Penta Capital Partners Flotation 1,398 Flotation Constellium France 5 Apollo Global Management Flotation 1,380 Flotation Just Retirement (Avalon Acquisitions) UK Permira Flotation 1,344 Flotation One GmbH/Orange Austria Telecommunication Austria 1 Mid Europa Partners Hutchinson 3G (Hong Kong) 1,300 Trade sale Aibel Norway 4 Ferd Private Equity Ratos/Ferd Capital 1,165 Secondary buyout Cerved Business Information Italy 3 Bain Capital and Clessidra CVC Capital Partners 1,130 Secondary buyout ProSiebenSat1 Media Germany Kohlberg Kravis Roberts and Permira Flotation 1,120 Flotation Vue Entertainment UK 8 Doughty Hanson Omers PE 1,094 Secondary buyout Allflex UK 7 Fleming Ventures BC Partners 971 Secondary buyout Taminco Belgium 4 Apollo Global Management Flotation 963 Flotation Cabot Financial UK 5 AnaCap JC Flowers 944 Secondary buyout 11 12 11 11 Exit type Source: CMBOR, Equistone Partners Europe, EY — year 2013 to end Q4 only Multiple January 2014 | 10
  11. 11. Market watch Manufacturing The 156 deals in the manufacturing sector accounted for more than €12.5b of value in 2013. The year saw manufacturing re-establish its position as the most popular sector for PE-backed deals, having slipped behind business and support services (by value if not volume) in 2012. The largest manufacturing deal of the year was the foreign divestment of Germany’s CeramTec, the global manufacturer of high-performance ceramics, which was valued at nearly €1.5b when it completed in September. The secondlargest manufacturing sector deal was Aibel, the Norwegian oil and gas engineering services supplier, which was acquired in a secondary buyout, with a value of €1.2b. During the year, 104 manufacturing companies successfully completed an exit for their investors, with a combined value of more than €15.1b. Manufacturing manufacturing this year, having been the most valuable sector in 2012. During 2013, 77 companies were acquired in buyout deals, with a combined value of more than €9.7b. The largest deal in the sector during 2013 was Ista, the German energy saving consultancy — a secondary buyout valued at €3.1b. The deal for Cerved Business Information, the Italian business information database provider, ranked second, with a value of €1.1b. The sector was also the second largest for exits during 2013, with 60 companies being sold on for a combined value of €11.3b. Telecommunications, media and technology (TMT) Business and support services (BSS) The TMT sector maintained its position as the third most valuable sector for buyouts in 2013, with 75 deals valued at €7b. The largest TMT deal during the year was also the largest deal overall — the €3.3b Springer Science Business Media secondary buyout. As noted earlier, the business and support services sector lost its top position by value to The sector was also the third largest in 2013 for exits, with a combined value of nearly €10b. “n terms of completed PE deals, activity in the EU healthcare sector for 2013 I was down compared with the previous year and lower than expected. Trade players were quite active in the market, a number of the deals took longer to close than anticipated, and some processes that were planned for 2013 have been delayed to 2014. Having said this, there is still strong interest in the sector among financial sponsors and the outlook for 2014 is more robust.“ Adrian Gibb, Head of Life Sciences and Healthcare Practice, TAS, EY UKI Q4 28 deals €1.8b 2013 156 deals €12.5b BSS Q4 20 deals €1.1b 2013 77 deals €9.7b TMT Q4 13 deals €0.8b 2013 75 deals €7b Healthcare Q4 9 deals €1b 2013 27 deals €3.3b Multiple January 2014 | 11
  12. 12. Country spotlight UK Q4: 45 deals €3.5b 2013: 188 deals €16.2b While remaining the most active in Europe by value and volume, buyout activity in the UK during 2013 was down on the previous year. By the end of 2013, some 188 deals had completed, with a combined value of €16.2b. This compares with the 206 deals, valued at more than €20b, recorded in 2012. The absence of any €1b-plus deals in the fourth quarter meant that the final quarter of the year with 45 deals at a total value of €3.5b, was significantly lower than Q4 2012 which had a total of 50 deals at €5.5b. However, the relative security that sterling offers has ensured that businesses are still attractive to investors, particularly US and Asian, looking to gain a foothold in Europe. The UK market has also led the way for IPO exits. Three of the largest 10 exits were UK based, and all of them were flotations. The largest exit was Merlin Entertainments Group, which raised €3.8b in an IPO in November. Multiple January 2014 | 12
  13. 13. Country spotlight (continued) Germany Q4: 18 deals €646m 2013: 67 deals €12.1b The German buyout market can now be said to performing as expected, vying with the UK as the most active market in Europe by value. Its 67 deals during 2013 (2012: 70) had a combined value of €12.1b (2012: €8.3b). However, this high valuation was undoubtedly bolstered by a handful of megadeals, including Springer Science Business Media (€3.3b), Ista (€3.1b), Douglas Holding (€1.5b) and CeramTec (€1.5b). Any uncertainty that may have been caused by the German general election soon disappeared, though the majority of value was achieved during the third quarter (€9.1b). In comparison, only €646m was achieved in Q4 2013. Some €16.5b was also returned to investors through 43 German exits during the year. As well as the secondary buyouts at Springer and Ista, this total includes the flotation of Stille Linde/Kion, which raised €2.4b for its investors. Multiple January 2014 | 13
  14. 14. Country spotlight (continued) France Q4: 16 deals €472m 2013: 96 deals €6.6b France’s total combined value for 2013 was dragged down by a slow fourth quarter of the year, when 16 deals achieved a combined value of just €472m. However, France is still Europe’s third most active buyout market. Overall, it saw 96 deals with a collective value of €6.6b during 2013, compared with 101 deals valued at €6.3b in 2012. The largest deal of the year was Allflex, valued at €985m. This deal was one of only four €500m-plus deals completed during the year and, for the second year in a row, the French market failed to produce any €1b-plus deals — in 2011, there were four such deals. The slowdown during the fourth quarter was emphasized by the fact that the largest deal in the final three months of the year was valued at €150m. The next largest in the fourth quarter was Europeene des Desserts (€100m), followed by Carre Blanc (€60m). Multiple January 2014 | 14
  15. 15. CMBOR methodology The data only includes the buyout stage of the PE market (management buyout (MBO), management buy-in (MBI), institutional buyout (IBO), buy-in management buyout (BIMBO)) and does not include any other stage, such as seed, start-up, development or expansion capital. Unless otherwise stated, the data includes all buyouts, whether PE-backed or not, and there is no size limit to deals recorded. In order to be included as a buyout, over 50% of the issued share capital of the company has to change ownership with either management or a PE company or both jointly having a controlling stake upon deal completion. Buyouts and buy-ins must be either management led or led by a PE company using equity capital primarily raised from one or more PE funds. Transactions that are deemed not to adhere to the PE or MBO/MBI model are not included. Transactions that are funded from other types of funds, such as real estate and infrastructure, are not included. Deals in which a PE firm buys property as an investment are not included. In order to be included, the target company (the buyout) must have its own separate financing structure and must not be held as a subsidiary of a parent holding company after the buyout. Firms that are purchased by companies owned by a PE firm are treated as acquisitions and are not included in the buyout statistics. However, these deals are recorded in the “acquisitions by buyout companies” statistics. All quoted values derive from the total transaction value of the buyout (enterprise value) and include both equity and debt. The buyout location is the location of the headquarters of the target company, and it is not related to the location of the PE company. The quarterly data only counts information on transactions that formally close in that quarter, and does not include announced deal information. Multiple January 2014 | 15
  16. 16. Contacts Sachin Date EMEIA Private Equity Leader + 44 20 7951 0435 sdate@uk.ey.com Country contacts: Marc Guns Belgium + 32 2 774 9419 marc.guns@be.ey.com Paul Gerber France + 33 1 55 61 09 65 paul.gerber@fr.ey.com Olivier Coekelbergs Luxembourg + 352 42 124 8424 olivier.coekelbergs@lu.ey.com Pedro Rodriguez Fernandez Spain + 34 915 727 469 pedro.rodriguezfernandez@es.ey.com Peter Wells Central and Southeast Europe + 420 225 335 254 peter.wells@cz.ey.com Klaus Sulzbach Germany, Switzerland and Austria + 49 6196 996 26186 klaus.sulzbach@de.ey.com Maurice van den Hoek Netherlands + 31 88 40 70434 maurice.van.den.hoek@nl.ey.com Demet Ozdemir Turkey + 90 212 368 5264 demet.ozdemir@tr.ey.com Leonid Saveliev Commonwealth of Independent States + 7 495 705 9702 leonid.saveliev@ru.ey.com Umberto Nobile Italy + 39 028 066 9744 umberto.nobile@it.ey.com Michel Eriksson Nordics + 46 8 520 593 54 michel.eriksson@se.ey.com Bridget Walsh United Kingdom and Ireland + 44 20 7951 4176 bwalsh@uk.ey.com Marketing: Katherine Squier Transaction Advisory Marketing + 44 20 7951 8531 ksquier@uk.ey.com For more information, please visit ey.com/multiple. Multiple January 2014 | 16
  17. 17. Further insights 2014 APAC PE outlook report Credit Markets 2013–2014 Capital Insights The APAC PE market is robust, and survey respondents expect it to stay strong in the coming year as opportunities abound and credit remains ample. Our annual publication providing analysis and opinions on credit markets. The first edition discusses the issues that have impacted the credit markets during 2013 and gives a view on what 2014 might bring for businesses navigating debt markets and capital providers. How can companies combine the best traditional business methods with innovative approaches to help shape their destinies? View report View report View report Global Corporate Divestment Study 2014 The 2014 Global Divestment Study focuses on how companies review their portfolios and the leading practices of those that are able to maximize divestment outcomes. View report Global PE CFO survey Financing the future energy landscape Our inaugural global survey of PE chief financial officers finds widespread belief in near-term growth and an eagerness to leverage skills forged by the crisis. Our annual review of global oil and gas transaction activity. In this report, we look at some of the main trends in oil and gas deal activity over 2013 and the outlook for transactions in the sector in 2014. We analyze the diverse dynamics in the upstream, midstream, downstream and oilfield services (OFS) segments, as well as look at the regional trends that underlie the macroenvironment. View report View report Multiple January 2014 | 17
  18. 18. EY | Assurance | Tax | Transactions | Advisory About EY EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst Young Global Limited, each of which is a separate legal entity. Ernst Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com. About EY’s Transaction Advisory Services How you manage your capital agenda today will define your competitive position tomorrow. We work with clients to create social and economic value by helping them make better, more informed decisions about strategically managing capital and transactions in fast changingmarkets. Whether you’re preserving, optimizing, raising or investing capital, EY’s Transaction Advisory Services combine a unique set of skills, insight and experience to deliver focused advice. We help you drive competitive advantage and increased returns through improved decisions across all aspects of your capital agenda. © 2014 EYGM Limited. All Rights Reserved. EYG no. DE0500 EMEIA Marketing Agency 1000696 ED 0115 This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax or other professional advice. Please refer to your advisors for specific advice. ey.com/multiple EY — recognized by mergermarket as top of the European league tables for accountancy advice on transactions in calendar year 2012 and 2013 The views of third parties set out in this publication are not necessarily the views of the global EY organization or its member firms. Moreover, they should be seen in the context of the time they were made.
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