Private Equity 2012 Review


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*2012 Fundraising overview
*2013 Funds expected and LP commitment plans
*Buyout and venture deal-making review
*Exits: a round-up of trade sales, secondary buyouts and IPOs
*Views from the industry

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Private Equity 2012 Review

  1. 1. PRIVATE EQUITY2012 Review & 2013 outlook January 2013
  2. 2. 01.09.13 Bloomberg Brief | Private Equity 2Contents Timeline click on orange triangles for interactive featuresfundraising Exitsoverview A round-up of trade MONTH ACTIONSA snapshot of 2012 sales, secondaryfundraising data and buyouts and IPOs. Republican presidential candidate and Bain Capital co-founder Mitt Romney releases his tax return, showing he paid JAN an effective tax rate of 13.9 percent on income of $21.6 million in launch predic- Page 12-13tions for 2013. Ripplewood Capital-backed Hostess Brands files for bankruptcy protection.Pages 3-5 top iPOs A glance at 2012’s Nigel Doughty, co-founder of British private equity firm Doughty Hanson, dies aged 54.LP COMMITMENTS largest private equity FEB A consortium that includes Apollo Global Management agrees to buy EP Energy for $7.2 billion, in what will be theInvestors’ alloca- and venture-backed largest buyout of the year.tion strategies and IPOs.calendar dates for Page 14 U.S. President Barack Obama signs the Jobs Act into law, easing IPO registration requirements for start-ups andthe coming year. promising changes to how funds can be marketed.Pages 6-7 VOICES GPs and LPs share MAR Morgan Stanley Private Equity Asia makes its largest-ever investment, with its $300 million backing of China’s TianheBUYOUT DEALS their views on the Chemicals Group.Global buyout trans- past year and give Zayo Group announces a $472 million equity round of funding, the largest of 2012.actions during 2012 predictions for sector, size and Pages 15-17geography. Behrman Capital proposes a secondary deal to investors to keep some of the companies in its 2001 fund alive, follow- APR ing the lead of Willis Stein & Partners, which offered a similar deal to its LPs in February.Page 8-9 NEWS TRENDS A look at the mostventure rounds mentioned terms in Accel Partners, Tiger Global Management and Digital Sky Technology offer some of their shares in Facebook as theGlobal venture capi- 2012’s private equity social network company goes public. Its shares subsequently tank, stifling VC-backed IPOs for months.tal deals by sector, news coverage Carlyle Group goes public, following Oaktree Capital’s IPO a month earlier.size and geography. Page 18Page 10-11 MAY Michael Moritz steps back from daily management at Sequoia Capital after disclosing that he has a rare illness. The Ewing Marion Kauffman Foundation makes waves with its 51-page study claiming that LPs should accept blame for weak returns from venture capital. Bloomberg Brief Private Equity 2012 Review & 2013 Outlook Scott Schoen leaves buyout firm Thomas H. Lee Partners after 26 years. Newsletter Ted Merz European venture firm DN Capital earns a 20x return on its sale of U.K. mobile platform Apsmart to Thomson Reuters. Executive Editor +1-212-617-2309 JUN KKR agrees to sell a stake in Alliance Boots to Walgreens in what will be the biggest exit of the year. Bloomberg News Larry Edelman Joseph Rice III, aged 80, steps down as chairman of Clayton, Dubilier & Rice. Managing Editor +1-617-210-4621 Private Equity Editors JUL Bain Capital completes the fundraising for its $2.3 billion second Asia fund. Jennifer Rossa Susannah Birkwood +1-212-617-8074 +852-2744-4822 AUG Bain Capital co-founder Mitt Romney is formally nominated as the Republican U.S. presidential candidate. Private Equity Reporters Sabrina Willmer Ari Levy Both Providence Equity Partners and CVC Capital Partners agree to sell stakes in their management companies to +1-212-617-2515 +1-415-617-7113 large limited partners. Data Editors PAG announces a final close on $2.4 billion for its debut private equity fund, an Asia-focused buyout vehicle that will Jill Lewandosky Inessa Collier SEPT principally target China deals. 212-617-4414 212-617-1187 Bain Capital, KKR and Merrill Lynch are accused of price fixing in a lawsuit brought by the ex-shareholders of Adam Kruithof hospital management firm HCA. 609-279-5006 Blackstone Group closes what is believed to be the largest real estate fund ever at $13.3 billion. Newsletter Nick Ferris Debt issued to fund private-equity dividends reaches $54 billion for this year. Six companies sell PIK-toggle bonds to Business Manager fund these payouts. +1-212-617-6975 OCT Advertising French fund managers predict that President Francois Hollande’s proposed tax increases on carried interest profits +1-212-617-6975 may be “the death of private equity in France.” Reprints & Lori Husted Paul M. Wythes, one of Silicon Valley’s earliest venture capitalists as co-founder of Sutter Hill Ventures, dies aged 79. Permissions +1-717-505-9701 Advent International raises $10.8 billion for its seventh fund, the largest pool raised for private-equity investments in To subscribe via the Bloomberg terminal type BRIEF two years. <GO> or on the web at NOV Terra Firma Capital agreed to buy U.K. defense-employee housing operator Annington Homes from Nomura for $5.1 To contact the editors: billion, the third largest private equity deal of the year. This newsletter and its contents may not be forwarded or redistributed without the prior consent of Bloomberg. The Newtown school shooting leads Cerberus Capital Management to put Freedom Group, the largest U.S. gun- Please contact our reprints and permissions group listed maker, up for sale. above for more information DEC Focus Media agrees to be bought by a consortium of investors led by Carlyle Group in a $3.7 billion deal that will be © 2013 Bloomberg LP. All rights reserved. China’s largest leveraged buyout.  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  3. 3. 01.09.13 Bloomberg Brief | Private Equity 3Fundraising Click on orange triangles for interactive features2012 Fundraising by Region, Type ($ Millions) Asia Pacific Asia Pacific Eastern Latin America Middle East North Western Asia Pacific Emerging Grand Multiple Developed Emerging Europe and Caribbean and Africa America Europe & Developed Total Buyout $2,137 $1,913 $3,142 $386 $900 $51,388 $52,510 $16,378 $6,500 $135,255 Debt $544 $232 $22,393 $6,202 $7,237 $470 $37,078 Fund of Funds $1,287 $92 $6,176 $2,286 $303 $1,643 $11,788 Growth $690 $3,914 $517 $916 $944 $6,877 $4,838 $232 $56 $18,985 Other $1,000 $25 $1,025 Real Assets $325 $9,523 $5,249 $3,872 $647 $19,616 Real Estate $2,171 $852 $684 $1,264 $480 $16,326 $14,301 $4,948 $645 $41,671 Secondary $22,599 $1,825 $303 $24,726 Venture $1,415 $120 $214 $180 $10,134 $11,938 $1,181 $6 $25,188 Grand Total $4,998 $9,926 $4,463 $3,105 $2,828 $146,416 $99,175 $34,453 $9,967 $315,330Source: Bloomberg. Amounts represent capital closed in 2012. Non-dollar amounts have been converted.Buyout Firms Dominate, Real Estate Second Funds Targeting Multiple Regions Are Popular # of Funds # of Funds 2% 6% Asia Pacific Developed Buyout 12% 2% 22% Debt 8% 27% 2% 11% 3%3% Asia Pacific Emerging 8% Fund of Funds 1% 2% Asia Pacific Emerging & Growth Developed 43% 3% 13% Other 32% North America Volume 23% Volume Real Assets Latin America and 6% 10% 1% Caribbean 14% Real Estate 46% 6% 48% Middle East and Africa 4% 1% 12% Secondary 2% 4% 9% 3% Multiple Venture 11% Source: Bloomberg Source: BloombergBuyout firms raised $135 billion in 2012. The average size buyout fund Developing Asia was the most popular emerging market for fundraising inwas about $700 million. The average size VC fund was about $154 million. 2012, making up 8 percent of funds raised and 6 percent of capital. SHOP FOR PREMIUM RESEARCH, DATA AND NEWS  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  4. 4. 01.09.13 Bloomberg Brief | Private Equity 4fundsBlackstone Tops 2012 Fundraising List With Latest Real Estate FundBlackstone Real Estate Partners VII LP held a final close on $13.3 billion in 2012. Advent International GPE VII LP was second, closingon 8.5 billion euros, the largest pool raised for private equity investments in two years. The largest venture fund to close in 2012 wasNew Enterprise Associates 14 LP, which raised $2.6 billion.Funds That Raised More Than $1 Billion and Held Final Closes in 2012 Total Fund Name Strategy Region Sector Placement Agent Raised ($M) Park Hill Real Estate Group, Merrill Lynch Pierce Fenner 1 Blackstone Real Estate Partners VII LP Real Estate Multiple Real Estate $13,300 & Smith, UBS Financial Services, JP Morgan Securities 2 Advent International GPE VII LP Buyout Multiple Generalist $8,500 None 3 BC European Capital IX Buyout Multiple Generalist $8,359 None Mitsubishi Corp Asset Management, Credit Suisse 4 Global Infrastructure Partners II LP Real Assets Multiple Infrastructure $8,250 Securities 5 AXA Secondary Fund V LP Secondary Multiple Generalist $7,100 None 6 Green Equity Investors VI LP Buyout North America Generalist $6,250 None 7 Coller International Partners VI LP Secondary Multiple Generalist $5,500 None 8 Oaktree Opportunities Fund IX LP Debt Multiple Generalist $5,000 None 9 Ares Corporate Opportunities Fund IV LP Buyout Multiple Generalist $4,700 AE Holding Group 10 Mount Kellett Capital Partners II LP Debt Multiple Generalist $4,000 None 10 GSO Capital Opportunities Fund II Debt Multiple Generalist $4,000 None 12 American Securities Partners VI LP Buyout North America Generalist $3,640 Greenhill & Co, Phoenix Capital Advisory 13 NGP Natural Resources X LP Buyout Multiple Energy/Renewables $3,586 None 14 Vista Equity Partners Fund IV LP Buyout Multiple Technology $3,500 None 15 Denham Commodity Partners Fund VI LP Buyout Multiple Energy/Renewables, Materials $3,000 Park Hill Group LLC 15 Capital International Private Equity Fund VI Growth Multiple Generalist $3,000 Mvision Private Equity Advisors 17 CS Strategic Partners V LP Secondary Multiple Generalist $2,900 Credit Suisse Securities (USA) LLC 18 Avenue Europe Special Situations Fund II Debt Western Europe Generalist $2,780 None 19 Summit Partners Growth Equity Fund VIII Growth Multiple Generalist $2,700 Eaton Partners LLC 20 New Enterprise Associates 14 LP Venture North America Generalist $2,600 None 20 Partners Group Secondary 2011 LP Secondary Multiple Generalist $2,600 None 22 Metalmark Capital Partners II LP Buyout North America Generalist $2,572 None 23 Blackstone Energy Partners LP Real Assets Multiple Energy/Renewables $2,500 Deutsche Bank Securities, Morgan Stanley Barney 24 PAG Asia I LP Buyout Asia Pacific Emerging Generalist $2,400 Park Hill Group LLC 25 Carlyle Realty Partners VI Real Estate North America Real Estate $2,340 Citigroup Global Markets Inc. 25 Sentient Global Resources Fund IV LP Real Assets Multiple Natural Resources $2,300 None Asia Pacific Emerging, 25 Bain Capital Asia Fund II LP Buyout Generalist $2,000 None Asia Pacific Developed 28 TPG Growth II LP Growth Multiple Generalist $2,000 TPG Capital BD LLC 29 Centerbridge Special Credit Partners II LP Debt Multiple Generalist $2,000 None 30 EnCap Flatrock Midstream Fund II LP Real Assets North America Energy/Renewables $1,750 None 31 Fortress Japan Opportunity Fund II Real Estate Asia Pacific Developed Real Estate $1,650 Fortress Capital Formation 32 Roark Capital Partners III LP Buyout North America Generalist $1,559 Lazard Freres & Co LLC 33 Baring Vostok Private Equity Fund V LP Buyout Eastern Europe Generalist $1,500 UBS Securities 33 Andreessen Horowitz Fund III LP Venture Multiple Technology $1,500 None 35 BlueMountain Credit Opportunities Fund I LP Debt Multiple Generalist $1,400 None 36 Carlyle Energy Mezzanine Opportunites Fund LP Debt Multiple Energy/Renewables $1,380 None 37 OHA European Strategic Credit Fund Debt Western Europe Generalist $1,350 Credit Suisse Securities (USA), LLC 37 FountainVest China Growth Capital Fund II LP Growth Asia Pacific Emerging Generalist $1,350 UBS Securities 39 Morgan Stanley Private Markets Fund V LP Fund of Funds Multiple Generalist $1,300 Morgan Stanley Smith Barney LLC Fortress Group, RBC Wealth Mgmt, Morgan Keegan, 39 Portfolio Advisors Secondary Fund II LP Secondary Multiple Generalist $1,300 Alternative Investments Co. 41 Thoma Bravo Fund X LP Buyout North America Technology $1,250 None 41 Audax Private Equity Fund IV Buyout North America Generalist $1,250 None 41 KKR Natural Resources Real Assets Multiple Energy/Renewables $1,250 None 44 Axiom Asia Private Equity Fund III LP Fund of Funds Asia Pacific Emerging Generalist $1,150 Probitas Partners 44 Prudential Capital Partners IV Debt North America Generalist $1,150 Terrain Placement Services 46 Patron Capital LP IV Real Estate Western Europe Real Estate $1,132 Monument Group Inc 47 Harvest Partners VI LP Buyout North America Generalist $1,100 Credit Suisse Securities (USA) LLC 47 Carlyle US Equity Opportunity Fund LP Buyout North America Generalist $1,100 Foreside Fund Services LLC 49 Meridiam Infra. North America Fund II LP Real Assets Multiple Infrastructure $1,050 Campbell Lutyens & Co.Source: Bloomberg. Non-dollar figures have been converted.  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  5. 5. 01.09.13 Bloomberg Brief | Private Equity 5 These pages are available to subscribers only. To access the full report and to take a free trial please contact us: Annie Gustavson Email: Tel: 212-617-0544  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  6. 6. 01.09.13 Bloomberg Brief | Private Equity 6 These pages are available to subscribers only. To access the full report and to take a free trial please contact us: Annie Gustavson Email: Tel: 212-617-0544  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  7. 7. 01.09.13 Bloomberg Brief | Private Equity 7 These pages are available to subscribers only. To access the full report and to take a free trial please contact us: Annie Gustavson Email: Tel: 212-617-0544  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  8. 8. 01.09.13 Bloomberg Brief | Private Equity 8 These pages are available to subscribers only. To access the full report and to take a free trial please contact us: Annie Gustavson Email: Tel: 212-617-0544  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  9. 9. 01.09.13 Bloomberg Brief | Private Equity 9Buyout dealsU.S. Seen as Haven for Deals Amid Global Slowdown in 2012The U.S. dominated deal volume this year as Europe’s fiscal crisis persisted and developing world economies slowed. The U.K., Austra-lia, Germany, and Canada rounded out the top five.Largest Buyouts of 2012 Announce Value Target Rank Target Name Acquirer Name Seller Name Sector Date ($m) Location Access Industries, Apollo Global Management, Korea 1 24-Feb EP Energy Global El Paso 7,150 Energy Houston National Oil Corp, Riverstone Holdings 2 18-Jul Cequel Communications Holdings BC Partners Holdings, CPPIB 6,580 Communications St. Louis 3 19-Nov Annington Homes Terra Firma Capital Partners Nomura Holdings 5,091 Real Estate U.K. 4 30-Aug DuPont Performance Coatings Carlyle Group Du Pont 4,900 Basic Materials Australia Abu Dhabi Investment Authority, British Columbia Invest- 5 16-May Open Grid Europe ment Management Corp, ERGO Versicherungsgruppe, E.ON SE 4,078 Utilities Germany Macquarie Group, Muenchener Rueckversicherungs 6 5-Dec Primaris Retail REIT KingSett Capital, Ontario Pension Board 4,043 Real Estate Canada 7 25-Jul United Technologies units Carlyle Group, BC Partners United Technologies Corp 3,460 Industrial CDH Investments Fund, China Everbright, CITIC Capital 8 13-Aug Focus Media Holding 3,427 Media Hong Kong Partners, Carlyle Group, FountainVest Partners 9 15-Aug Getty Images Carlyle Group Hellman & Friedman 3,300 Communications Seattle 10 17-Feb TransUnion Corp Advent International Corp, Goldman Sachs Capital Partners Madison Dearborn Partners 3,000 Financial Services Chicago 11 5-Jun Party City Holdings Thomas H Lee Partners 2,690 Retail New York 12 26-Nov McGraw-Hill Education Business Apollo Global Management McGraw-Hill Cos 2,500 Consumer Products New York 13 29-Feb Ahlsell AB CVC Capital Partners Goldman Sachs Group, Cinven 2,404 Industrial Sweden 14 17-Oct Nine Entertainment Co Holdings Apollo Capital Management, Oaktree Capital CVC Capital Partners Group 2,384 Media Australia Goldman Sachs Capital 15 26-Nov USI Holdings Corp Onex Corp 2,300 Financial Services New York PartnersSource: Bloomberg  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  10. 10. 01.09.13 Bloomberg Brief | Private Equity 10Venture Rounds click on orange triangles for interactive featuresVenture Firms Favor the Familiar: North America, TechStart-ups raised $32.5 billion in 2012, Bloomberg data show. Venture firms, facing a tough fundraising and exit environment, appeared tobe sticking to their core competencies, investing in familiar regions and familiar industries.Communications, Consumer, Tech Draw Most VC North America Dominates Venture Volume # of Basic Materials Africa Rounds # of 18% 27% 1% Communications Rounds 13% N. Amer 22% Consumer, Cyclical 2% 31% 37% 3% CEE Consumer, Non-cyclical Value 1% 7% Energy 6% Value Asia-Pac 6% 2% Financial 1% 6% 5% MENA 6% Industrial 2% 77% LatAm 3% Utilities 72% 27% 4% Technology W. Europe 21% Source: Bloomberg Source: Bloomberg Healthcare deals, included largely in consumer non-cyclical, attracted Western Europe attracted the second most capital, with four rounds of$6.6 billion of capital; and energy/clean energy, about $1.5 billion. $100 million or more: Deezer, CureVac, Mapper Lithography, and Spotify.U.S.-Based Start-ups Get Lion’s Share of Venture FundingU.S. start-ups received $24 billion of venture funding in 2012, exceeding the U.K., the second country on the list at $1.8 billion, by more than a factor of10. India was in third place at $1.3 billion, followed by Canada and Germany. China was seventh, after France.  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  11. 11. 01.09.13 Bloomberg Brief | Private Equity 11Venture RoundsVenture Rounds of More Than $100 MillionBandwidth infrastructure company Zayo Group raised $472 million in equity, the largest round of 2012, and $2.87 billion in debt to fundits purchase of publicly traded AboveNet. The round, from a combination of buyout and venture firms, was led by GTCR LLC.2012’s Largest Venture Rounds Value TargetRank Announced Target Name Investors Sector ($M) Location 1 19-Mar Zayo Group LLC Battery Ventures, Centennial Ventures, Charlesbank Capital Partners, GTCR LLC 472 Communications Infrastructure Colorado 2 24-Jan SquareTrade Inc Bain Capital Partners 238 Financial Services California 3 8-Aug Square Inc Citi Ventures, Rizvi Traverse Management, Starbucks Corp 200 Internet Services California 4 5-Mar Drilling Info Inc Battery Ventures, Eastern Advisors Capital, Insight Venture Partners 165 Energy Texas 5 6-Jun Fanatics Inc Andreessen Horowitz, Insight Venture Partners 150 E-commerce Florida 5 31-Jan Flipkart Online Services Pvt Ltd Accel Partners, Tiger Global Management 150 E-commerce India 5 24-Aug Flipkart Online Services Pvt Ltd Naspers, Accel Partners, Tiger Global Management, Iconiq Capital 150 E-commerce India 8 28-May Fisker Automotive Inc. Kleiner Perkins Caufield & Byers, New Enterprise Associates 148 Automobiles California 9 2-Apr Sapphire Energy Inc Arrowpoint Partners, Monsanto, Arch Venture Partners, Venrock Associates 144 Renewable energy California 10 26-Jul Inc Technology Crossover Ventures 136 Consumer Products Virginia 11 6-Oct Deezer Access Industries LLC, Indivest Pte Ltd 131 E-commerce France Accel Partners, IDG Capital Partners, Morgan Stanley Investment Management, 12 10-Apr Legend Pictures LLC 128 Media California Thiel Capital, Tomorrow Ventures Bessemer Ventures, DFF Growth, General Atlantic, New Enterprise Associates, 13 1-Aug Inc 125 Internet Services California SAP Ventures, Scale Venture Partners, Social Capital Partners 13 24-Jul NantPharma LLC Blackstone Group 125 Pharmaceuticals California Andreessen Horowitz, Atomico, Baroda Ventures, DoCoMo Capital, First Round 15 18-Jul Inc 120 E-commerce New York Capital, Mayfield Fund, Menlo Ventures, Phenomen Ventures, Pinnacle Ventures American Refining and Biochemical, DAG Ventures, Generation Investment 16 12-Apr Harvest Power Inc 110 Renewable energy Maine Management, Kleiner Perkins Caufield & Byers, True North Venture Partners 17 18-Sep CureVac GmbH Dievini Hopp BioTech Holding GmbH 105 Pharmaceuticals Germany 18 10-Jul Elevance Renewable Sciences Inc Total SA,Genting Bhd 104 Renewable energy Illinois 18 26-Sep Fisker Automotive Inc. Advanced Equities, Kleiner Perkins Caufield & Byers, New Enterprise Associates 104 Automobiles California ASM International NV, Hoving & Partners SA, Parcom Capital BV, Rusnano, 20 23-Aug Mapper Lithography BV 101 Semiconductors Netherlands Technolution BV, ADP Industries, DemconSource: Bloomberg, NVCA  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  12. 12. 01.09.13 Bloomberg Brief | Private Equity 12Exits click on orange triangles for interactive featuresExits Via M&A Slowed in 2012M&A exits for private equity firms totaled about $143 billion in 2012. The numbers here reflect both debt and equity for M&A exits.Exit Volume Declines From 2011 Consumer Noncyclicals Lead Exits2500 700 Billions Exit Volume (RHS) Deal Volume (RHS) 600 # of Exits 7% 4%2000 8% Basic Materials Exit Deal Count (LHS) 7% 3% 500 10% Communications Deal Count (LHS)1500 16% 11% Consumer, Cyclical 400 29% 11% Consumer, Non-cyclical 3001000 9% Value Energy 200 Financial 7% 500 23% 100 37% Industrial 14% Technology 0 0 4% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: Bloomberg Source: BloombergExit volume lagged deal volume by more than $40 billion in 2012. In 2011, The biggest industry for exits was consumer non-cyclicals, which includedexit volume was almost on pace with deal volume. KKR’s sale of a stake in Alliance Boots, the biggest exit of the year.Largest Portion of Exits Are From N. Amer. Cos. Larger Exits Dominate Volume 1% 15% 21% 16% 5% 3% 25% Africa Asia-Pac Large 33% 35% 2% 9% Large Midmarket 2% CEE-Russia N. Amer Volume 1% Value 1% 1% 16% Mega 1% MENA LatAm 54% 1% 55% Number Number 12% Small W. Europe Small Midmarket 49% Number 42% Source: Bloomberg Source: BloombergNorth America and Western Europe dominated exit volume. Asia lagged, Exits classed as large made up 54 percent of volume and 15 percentwith $7.5 billion of announced exits in 2012. of exit count in 2012. Make an IMpact wIth Bloomberg Briefs provide dedicated licenses to reuse our content to help your business. We offer a full suite of BlooMBerg BrIef content products and services ranging from hardcopy and electronic reprints to plaques, permissions/licensing and photocopies. to find the solution that is right for you, contact us today at: 800 290 5460 x 100, email:  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  13. 13. 01.09.13 Bloomberg Brief | Private Equity 13ExitsExits Via M&A Most Prevalent in Developed MarketsPrivate equity firms sold $76.4 billion worth of U.S.-based companies. U.K.-based companies accounted for $13.8 billion of exits. Round-ing out the top five were Sweden, Switzerland - home of Alliance Boots, the largest exit of the year - and Iceland.Largest M&A Exits of 2012 Value TargetRank Announced Target Seller Acquirer target Sector ($M) Location 1 19-Jun Alliance Boots KKR & Co Walgreen 6,595.7 Retail Switzerland 2 25-Apr Actavis Group Novator EHF Watson Pharmaceuticals 5,610.4 Healthcare Iceland General Atlantic, Ospraie Management, Soros Fund 3 29-May Gavilon Group Marubeni Corp 5,600.0 Agriculture Omaha, Neb. Management 4 15-Mar NDS Group News Corp, Permira Advisers Cisco Systems 5,000.0 Technology U.K. 5 21-Dec Aviation Business/Avio Finmeccanica, Cinven Group General Electric 4,300.0 Industrial Italy 6 4-Dec Gambro Investor AB, EQT Partners Baxter International 4,019.9 Healthcare Sweden 7 29-Aug Goodman Global Group Hellman & Friedman Daikin Industries 3,700.0 Industrial Houston 8 3-Apr StarBev CVC Capital Partners Group Molson Coors Brewing 3,532.5 Consumer Products Czech Republic 9 15-Aug Getty Images Hellman & Friedman Carlyle Group 3,300.0 Communications Seattle 10 23-Jan Cordillera Energy Partners III Encap Investments Apache Corp 3,092.9 Energy Denver Advent International, 11 17-Feb TransUnion Madison Dearborn Partners 3,000.0 Financial Services Chicago Goldman Sachs Capital Partners 11 5-Aug AOT Bedding Super Ares Management, OTPP Advent International 3,000.0 Consumer Products Atlanta Apollo Global Management, Bain Capital Partners, Kansas City, 13 21-May AMC Entertainment Holdings CCMP Capital Advisors, Carlyle Group, Spectrum Equity Dalian Wanda Group 2,600.0 Media Mo. Investors, Weston Presidio 14 19-Mar Caiman Eastern Midstream Caiman Energy (Enstar Investments, Highstar Capital) Williams Partners 2,500.5 Energy Dallas 15 29-Feb Ahlsell Goldman Sachs Group, Cinven Group CVC Capital Partners 2,404.3 Industrial SwedenSource: Bloomberg  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  14. 14. 01.09.13 Bloomberg Brief | Private Equity 14top Buyout- and Venture-Backed IPOsTop 20 PE-Backed IPOs For 2012 Value IPO PercentPrice Company Target Industry Industry (USD Share Change Select Backers TypeDate Name country Group Sector MIL) Price From IPO 20% 0% Goldman Sachs Group Inc/The, Directors & Execu- IPO, Primary Share, Secondary -20% United 05/17 Facebook Inc 16,006.9 38.0 -40% FB US Internet Communications tive Officers, DST Global Solutions Ltd, T Rowe Price Share, VC Backed, VC Exit, PE -60% States Jan Apr Jul Oct Group Inc, Tiger Global Management LLC Backed, PE Exit 40% 20% 6837 HK Haitong Securities 0% Diversified PAG Asia Capital, Oman Investment Fund, Leading Local1st, Primary Share, PE 04/20 1,845.5 10.6 -20% China Financial Co Ltd -40% Finan Serv Investment & Securities Co Ltd Backed, HK H Shares Jan Apr Jul Oct 30% Jan Apr Jul Oct 30% IHH MK IHH Healthcare 20% Healthcare- Consumer, IPO, Primary Share, Secondary 07/12 1,328.5 2.8 10% Malaysia Abraaj Capital Ltd Bhd 0% Services Non-cyclical Share, PE Backed, PE Exit Jan Apr Jul Oct 60% Jan Apr Jul Oct 60% Realogy Holdings 40% RLGY US United Apollo Global Management LLC, Paulson & Co Inc, 10/10 1,242.0 27.0 20% Real Estate Financial IPO, Primary Share, PE Backed Corp 0% States Directors & Executive Officers Jan Apr Jul Oct 100% Jan Apr Jul Oct 100% ZIGGO NA 50% Nether- Telecommu- IPO, Secondary Share, PE 03/20 Ziggo NV 1,235.5 18.5 Communications Cinven Ltd, Warburg Pincus & Co 0% lands nications Backed, PE Exit Jan Apr Jul Oct 50% Jan Apr Jul Oct 60% 40% 20% DKSH SW Switzer- IPO, Secondary Share, PE 03/19 DKSH Holding AG 977.7 48.0 0% Advertising Communications Warburg Pincus LLC, Cinven Group Ltd -20% land Backed, PE Exit Jan Apr Jul Oct 30%Jan Apr Jul Oct 30% IHH SP IHH Healthcare 20% Healthcare- Consumer, IPO, Primary Share, PE 07/12 791.1 1.1 10% Malaysia Abraaj Capital Ltd Bhd 0% Services Non-cyclical Backed, PE Exit Jan Apr Jul Oct 150% Jan Apr Jul Oct 150% 100% WDAY US United 10/11 Workday Inc 732.6 28.0 50% Software Technology Greylock Partners, New Enterprise Associates Inc IPO, Primary Share, VC Backed 0% States Jan Apr Jul Oct 20% Jan Apr Jul Oct 20% Allison Transmis- 0% United Auto Parts & Consumer, IPO, Secondary Share, PE 03/14 690.3 23.0 -20% Onex Corp, Carlyle Group sion Holdings -40% ALSN US States Equipment Cyclical Backed, PE Exit Jan Apr Jul Oct 0% Jan Apr Jul Oct 0% -20% United PL Propylene LLC, Lindsay Goldberg & Co LLC, York IPO, Primary Share, Secondary 05/03 PetroLogistics LP 595.0 17.0 -40% Chemicals Basic Materials -60% PDH US States Capital LLC, PetroLogistics LLC Share, PE Backed, PE Exit Jan Apr Jul Oct 60% Jan Apr Jul Oct 60% VNTV US 40% United Commercial Consumer, Non- IPO, Primary Share, PE 03/21 Vantiv Inc 575.0 17.0 20% Advent International Corp, Fifth Third Bancorp 0% States Services cyclical Backed, PE Exit Jan Apr Jul Oct 20% Jan Apr Jul Oct 20% SRC US Spirit Realty 10% United 09/19 500.3 15.0 REITS Financial Highland Capital Management LP, TPG Axon Capital IPO, Primary Share, PE Backed Capital Inc 0% States Jan Apr Jul Oct 50%Jan Apr Jul Oct 50% Metal 0% United 03/28 Rexnord Corp 490.3 18.0 RXN US Fabricate / Industrial Apollo Global Management IPO, Primary Share, PE Backed -50% States Jan Jan Apr Apr Jul Jul Oct Oct Hardware 50% 0% United Oil & Gas IPO, Primary Share, Secondary 04/11 MRC Global Inc 477.3 21.0 MRC US Energy Goldman Sachs Group Inc -50% Jan Apr Jul Oct States Services Share, PE Backed, PE Exit 10% Berry Plastics 0% United Packaging & Apollo Global Management LLC, Graham Berry 10/03 470.6 16.0 -10% Industrial IPO, Primary Share, PE Backed Group Inc -20% BERY US States Containers Holdings LP Jan Apr Jul Oct 40% Jan Apr Jul Oct 40% FET US Forum Energy 20% United Oil&Gas IPO, Primary Share, Secondary 04/11 435.8 20.0 0% Energy SCF Partners Ltd, Directors & Executive Officers Technologies Inc -20% States Services Share, PE Backed, PE Exit Jan Apr Jul Oct 100% TUMI US Household 50% United Consumer, Non- Directors & Executive Officers, Doughty Hanson & IPO, Primary Share, Secondary 04/18 Tumi Holdings Inc 388.7 18.0 0% Products / -50% States cyclical Co Managers Ltd, Stockwell Capital LLC Share, PE Backed, PE Exit Jan 0%Jan Apr Apr Jul Jul Oct Oct Wares 0% Ningbo Cixing -50% Machinery- IPO, Primary Share, PE 03/16 336.0 35.0 300307 CH China Industrial Zhejiang Zheshang Venture Capital Co Ltd -100% Diversified Backed, China A Shares Jan Apr Jul Oct Jan Apr Jul Oct 0% Bros Eastern -20% Consumer, CITIC Private Equity Fund I/Mianyang Fund, IPO, Primary Share, PE 06/01 320.6 13.6 -40% China Textiles Co Ltd -60% 601339 CH Cyclical CPEChina Fund LP, Goldenstone Investment Ltd Backed, China A Shares Jan Apr Jul Oct Jan 100% Apr Jul Oct 100% PANW US Palo Alto Net- 50% United Telecommu- Greylock Partners, Sequoia Capital Operations IPO, Primary Share, Secondary 07/19 299.5 42.0 Communications works Inc 0% States nications LLC, Globespan Capital Partners Share, VC Backed Jan Apr Jul OctSource: Bloomberg  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  15. 15. 01.09.13 Bloomberg Brief | Private Equity 15VOICES By Sabrina Willmer, Ari Levy, and Susannah BirkwoodMitt Romney Was Big 2012 Story; U.S. Government ‘Dysfunction’ on Investors’ Minds in 2013Bloomberg Brief: Private Equity asked a number of private equity and venture capital executives, as well as limited partners, to share theindustry highlights of 2012 and make predictions for the coming year. Terrence Mullen, Partner at Arsenal Capital Partners The private equity story of the year was: Making sense of the “New Crazy Normal” - PE firms trying to determine the implications of continuing environmental complexity and how to capitalize on it. The best strategy/region to invest in this year was: High-growth, high value-add small U.S. industrials companies. My biggest investment focus in the coming year will be: Building, de-risking, and scaling our portfolio companies into big winners. My biggest investment-related worry in the coming year is: The continuing dysfunction of the U.S. government and its anti-growth, anti-business sentiment. Len Tannenbaum, CEO of Fifth Street Finance Story: The criticism of Mitt Romney’s private equity past and the attention he drew to the industry as a whole. Strategy/region: Mezzanine and second lien loans. Focus next year: One-stop financings for mid-market companies. Worry: The continued lack of visibility in the U.S. Congress and a fourth year with no budget. Ian Sigalow, Partner at Greycroft LLC Story: Mitt Romney and Bain Capital, although the Hostess bankruptcy is giving that a run for its money. Strategy/region: Emerging software companies. Focus next year: The same as last year, particularly e-commerce, video, increasing smart phone utilization, and cloud computing. Worry: The existence of fewer “true” Series B investors. You always have to make sure companies have a path to profitability. Lamar Villere, Director of Private Equity at Tennessee Consolidated Retirement System Story: The return of the PIK toggles, the dividend recaps, and the other bubbly leverage tools we thought were left for dead in 2008. Strategy/region: Ask me in 12 years. Focus next year: Finding great GPs with aligned interests. Worry: Frothy leverage leading to high prices for assets. Jim Herrington, Private and Public Equity Investment Officer, West Virginia Investment Management Board Story: One written by Sabrina, no doubt. Strategy/region: Depends on what your portfolio needs were. I don’t have a one-year focus, especially with PE. Focus next year: Building a good mix of risk/return across the portfolio. Picking the best managers for the next five to ten years. Worry: GPs forcing capital at the end of the investment period. Rainer Ender, Co-head of Investment Management, Adveq Story: The questioning of private equity’s role in the wider global economy as part of the U.S. presidential election. Strategy/region: In the Western world, specialized buyout and turnaround managers and venture capital with a global view on technology innovation. Focus next year: Outside the Western world, the firm remains very active in pursuing venture capital and growth opportunities in strong growing economies, such as China and India. Worry: With the time horizon of private equity, it remains crucial to work thoroughly and pursue a variety of diverse strategies with select fund managers.  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  16. 16. 01.09.13 Bloomberg Brief | Private Equity 16VOICES By Sabrina Willmer, Ari Levy, and Susannah Birkwood Steve Jurvetson, Managing Director of Draper Fisher Jurvetson Story: The rise of sectors that were largely considered out of favor, like enterprise and disruptive technology. Strategy/region: Disruptive technology was a key focus for us this year. We’re seeing innovation at an all-time high. Focus next year: We want to partner with extraordinary entrepreneurs who are starting the next SpaceX and Box. Worry: Consolidation of investment capital into the hands of too few. Jeff Brody, Partner at Redpoint Ventures Story: The failed IPOs of Facebook, Groupon and Zynga. Strategy/region: Early stage, rationally priced investments with committed and brilliant entrepreneurs, in companies developing unique and proprietary technology. Brazil and Silicon Valley. Focus next year: Offline to online. Industry and consumer marketplaces: new payment systems and financial servic- es, and transportation, marketing/advertising/merchandising systems. Worry: Too many maturing companies have disappointed investors, making it more challenging and expensive for deserving companies to access capital. Peter Fenton, General Partner at Benchmark Capital Story: Establishing new valuation heights through the Facebook IPO. Time will be the judge, but it may turn out to have been a fair price, or proof of the reality distortion of Silicon Valley. Strategy/region: Ubiquitous mobile, which has transformed every part of our world from transport (Uber), communi- cation (Twitter), discovery (Yelp), to photos (Instagram) and takeout (GrubHub). Focus next year: The non-obvious yet awe-inspiring new inventions coming from young entrepreneurs. Worry: The unprecedented levels of starvation for great engineering and design talent. Scott Sandell, General Partner at New Enterprise Associates Story: The resurgence of the U.S. IPO market relative to China and the rest of the world. This is a fundamental shift, in part a response to cooling sentiment toward emerging markets. Strategy/region: The enterprise sector was a big silver-lined cloud in the consumer internet tempest. Education technology has also gained a lot of momentum this year, with well over $600 million invested. Focus next year: Building enduring businesses, especially enterprise and education. Worry: The threat of macro headwinds looms large with volatility in Europe, in emerging markets and in Washington. Scott Weiss, Partner at Andreessen Horowitz Story: GitHub. The world’s largest source code repository took in $100 million in its first and likely only round of private financing. Strategy/region: Technical founders in Silicon Valley, a continuing geographic magnet for the startup ecosystem. Focus next year: The disruptive power of mobile and cloud is accelerating. There will be 50 new franchises in the enterprise stack across every application and infrastructure layer, e.g. networking, databases. Worry: Platform risk. As the world is moving quicker than anyone thought to mobile, we have two gorillas in Google and Apple that lord over most of the mobile ecosystem. Yegin Chen, Investment Officer, San Diego County Employees Retirement Association Story: The vilification of private equity in the U.S. presidential campaign. Strategy/region: Developing markets, especially in Asia. Focus next year: Developing markets (both private equity and private debt), especially in Latin America. Worry: Too much public and private capital flowing into developing markets. Gregory Garrett, Managing Director, Portfolio Advisors Story: The fund size resetting in the large/mega buyout space. Many managers that raised significantly larger fund sizes during the 2006-2008 era are now raising smaller funds and taking longer to raise them. Strategy/region: U.S. energy opportunities, which have generated significant interest from both public and private investors. Horizontal drilling and hydraulic fracking have opened new reserve opportunities. Focus next year: Due diligence on managers that can invest in both equity and debt-oriented securities. Worry: The further economic slowdown across the developed economies.  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  17. 17. 01.09.13 Bloomberg Brief | Private Equity 17VOICES By Sabrina Willmer, Ari Levy, and Susannah Birkwood David Sze, Managing Director at Greylock Partners Story: Reality sets in for the super-angels/micro VCs. Strategy/region: The Valley, as usual, despite the grumblings of other regions. Software IP in its new forms of con- sumer internet services, Software as a Service, Big Data analytics, is where the leverage and value creation is. Focus next year: Mobile social 2.0. Worry: Macro swamping micro. Klaus Ruhne, Partner at ATP Private Equity Partners Story: Succession in large-cap firms. Strategy/region: Small cap in the U.S. Focus next year: Distressed and emerging markets. Worry: Economy and tax issues related to PE. David Chen, Co-founder of AngelVest Story: Awareness about angel investing increased since a year ago and I’ve seen more funds and people doing early stage than before. Strategy/region: In China, the tier-1 cities of Beijing and Shanghai and their surrounding areas. Mobile technology, gaming and internet, e-commerce. Focus next year: Continued focus on mobile and internet, trying also to do cross-border. Investing in companies that have developed a presence elsewhere but have a technology that can be used in China. Worry: Getting step-ups for our companies, and exits. Can our companies become more valuable through additional funding? And can we get our cash out at some point? Thomas Kubr, Executive Chairman of Capital Dynamics Story: 2012 still hasn’t returned the industry to a state that we can call “normal” I expected the industry to come back . by 2012 at the latest, but it feels a lot like 2010 and 2011. Strategy/region: Strong companies in strong markets. The question “what’s the best sector, the best country?” is nonsensical. Anyone who asks that question still hasn’t fully understood what private equity is about. Focus next year: Looking for great funds that invest in great companies. Much the same as for the last two decades. Worry: In Asia, it is the future of China; in the U.S., it is a significant loss of confidence; in Europe, it continues to be the inability to solve their fundamental institutional problems. Vincent Huang, Partner at Pantheon Ventures Asia Story: The Chinese market shifted towards more of an RMB market. It’s become more and more pronounced that the local market is more important now. Strategy/region: China continued to be one of the more attractive markets. Focus next year: China, India and Australia will continue to be the three largest markets we focus on, although India is falling out of favor a bit because the liquidity hasn’t happened. Worry: Thing cannot be worse: the European crisis, the U.S. fiscal cliff. These issues aren’t going to be solved any time soon; they will be ongoing. Sebastiaan van den Berg, Managing Director, HarbourVest Partners Asia Story: Southeast Asia has continued to be a big driver of activity in Asia Pacific. A lot of people wanted to increase their exposure to the new funds and the larger incumbent funds being raised there. Strategy/region: This year was probably an OK year to invest in Southeast Asia, with lower P/E multiples than in other growth markets. Australia continued to be a steady buyout market. Focus next year: I’m optimistic that we’ll see much better performance from China overall next year. Worry: The situation between China and Japan is a cause for uncertainty. [Japan’s prime minister] Shinzo Abe com- ing back into government brings the risk that tensions could escalate.  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 
  18. 18. 01.09.13 Bloomberg Brief | Private Equity 18NEWS TRENDS Type NT <GO> on the terminal to look at story countsCarried Interest, Rubenstein Among Most Mentioned Terms in Private Equity News CoverageMitt Romney’s Bain Capital Past Sparks Carried Interest Tax Debate350 Number of Stories Mentioning Carried Interest Mitt Romney says he300 has no plans to release Obama proposes to his tax returns tax the debt used in250 private equity deals Bain Capital starts raising The second Obama-Romney200 buyout fund with $6b target debate is aired, drawing Mitt Romney’s campaign 65.6m viewers150 releases his tax returns100 50 0 1/1/12 2/1/12 3/1/12 4/1/12 5/1/12 6/1/12 7/1/12 8/1/12 9/1/12 10/1/12 11/1/12 12/1/12Source: BloombergCarlyle Group Founder David Rubenstein is 2012’s Most Mentioned PE Executive 80 Rubenstein says Mitt Number of Stories Mentioning David Rubenstein 70 Romney’s taxes shouldn’t be criticized 60 50 Rubenstein says Korea, 40 Rubenstein donates $7.5m to Taiwan, Indonesia attrac- fix the Washington Monument tive markets at Bloomberg Carlyle’s founders claimed China event 30 not to want to sell shares in the firm’s IPO 20 Carlyle raises $671 million in its IPO 10 0 1/1/2012 2/1/2012 3/1/2012 4/1/2012 5/1/2012 6/1/2012 7/1/2012 8/1/2012 9/1/2012 10/1/2012 11/1/2012 12/1/2012Source: Bloomberg Bloomberg Brief publishes 18 groundbreaking daily and weekly newsletters. For the full list of titles visit or BRIEF <GO> on your Bloomberg terminal BRIEF  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18