Pitch book pe_trends_3q2012_presentation_deck

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Private Equity Trends Q2 2012

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Pitch book pe_trends_3q2012_presentation_deck

  1. 1. Private Equity Trends 3Q 2012 Presentation Slide DeckTry the PitchBook Platform: Consult the Research Team:Email: demo@pitchbook.com Email: research@pitchbook.comPhone: 1-877-267-5593 Phone: 1-877-636-3496
  2. 2. The PitchBook Platform REQUEST A DEMO:demo@pitchbook.com 1-877-267-5593 Source:PitchBook
  3. 3. PE Investment Off to a Slow Start in 2012 Number of Deals Closed (orange line) and Total Capital Invested by Year (blue bars)$900 3,500 3,035$800 3,000$700 2,545 2,500$600 2,229 2,029 1,870 1,893 2,000$500 1,694 1,411$400 1,500 1,227$300 858 666 1,000$200 500$100 $76 $147 $219 $300 $491 $817 $345 $151 $336 $344 $106 $0 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012* Capital Invested ($B) # of Deals Closed *As of 6/30/2012 Source:PitchBook
  4. 4. The first half of 2012 got offto a slow start for the PEindustry, but 2012 still hastime to rebound… Source:PitchBook
  5. 5. A Slowdown in Private Equity Investment was Not Completely Unexpected Number of Deals Closed and Total Capital Invested by Quarter$300 900 796 749 757 733 800$250 719 700 595 579$200 600 481 497 446 456 459 500 519 426$150 396 403 354 363 400 334 320 419 303$100 300 200$50 100 $171 $187 $202 $256 $118 $73 $115 $40 $50 $22 $28 $51 $65 $82 $69 $120 $87 $80 $84 $93 $55 $51 $0 0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 2007 2008 2009 2010 2011 2012 Capital Invested ($B) # of Deals Closed Source:PitchBook
  6. 6. Healthcare and IT Increase Share of Activity Percentage of Deal Volume (count) by Industry100% Business Products and Services (B2B)90% Consumer Products80% and Services (B2C)70% Energy60% Financial Services50%40% Healthcare30% Information20% Technology10% Materials and Resources 0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012* *Through 6/30/2012 Source:PitchBook
  7. 7. B2B Led PE Investment in 1H 2012, Followed by IT and B2C Percentage of Deal Volume (capital) by Industry100% Business Products and Services (B2B)90% Consumer Products80% and Services (B2C)70% Energy60% Financial Services50%40% Healthcare30% Information20% Technology10% Materials and Resources 0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012* *Through 6/30/2012 Source:PitchBook
  8. 8. Middle Market Deals Dominate Market Share Percentage of Deal Volume (capital) by Deal Size Range100%90%80%70%60%50%40%30%20%10% 0% 2004 2005 2006 2007 2008 2009 2010 2011 2012* Under $50M $50M-$250M $250M-$500M $500M-$1B $1B-$2.5B $2.5B+ *Through 6/30/2012 Source:PitchBook
  9. 9. Let’s take a closer look at thetrends in those deals thathave closed… Source:PitchBook
  10. 10. Add-ons Continue to Represent About Half of Total Buyout Activity Add-on Deals as Percentage of Buyout Deals2,500 60% 49% 47% 48% 50% 47%2,000 44% 44% 40% 40% 41% 38% 1364 40% 35% 36%1,500 34% 1216 948 30% 986 7351,000 744 863 20% 523 630 500 430 1084 424 837 270 10% 326 655 748 719 652 485 463 289 337 250 200 216 0 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012* Add-on Non Add-on Add-on % of Buyout *Through 6/30/2012 Source:PitchBook
  11. 11. Median Buyout Deal Sizes Decreased in 1H 2012 Median Exit Size ($M)$350 $320$300 $261 $250 $243$250 $221 $215 $198 $200$200 $191 $190 $178 $172 $150 $150 $151 $145$150 $143 $130 $117$100 $92 $80$50 $43 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 * 2012 Corporate Acquisition Secondary Buyout *Through 6/30/2012 Source:PitchBook
  12. 12. Links for PitchBook Deal Flow Charts PitchBook users can click the links below to load the corresponding chart directly into the PitchBook Platform for further customizationSlide 3 – PE deal flow by yearClick to customize chart in PitchBook How to view in PitchBook:Slide 5 – PE deal flow by quarter 1) Right click on the linkClick to customize chart in PitchBook 2) click ‘open hyperlink’Slide 6 – PE deal flow (count) by industry by year 3) Log-in to PitchBookClick to customize chart in PitchBookSlide 7 – PE deal flow (capital) by industry by yearClick to customize chart in PitchBookSlide 8 – PE deal flow (capital) by size bucketClick to customize chart in PitchBook Source:PitchBook
  13. 13. Exit activity was down slightlyin 2Q but is expected toaccelerate through the end ofthe year. Source:PitchBook
  14. 14. 114 Exits in 2Q 2012 on Par with 2011 Average Quarterly PE Exits by Corporate Acquisition, IPO and Secondary Sale200180 175160 155 147 136140 131 131 129 127 119 122 120 117 114 114120 112 100 100100 94 92 85 87 80 80 59 60 55 49 36 40 20 - 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 2006 2007 2008 2009 2010 2011 2012 Secondary Buyout IPO Corporate Acquisition Source:PitchBook
  15. 15. Median Exit Size has Dropped 11% since 2010 Median Exit Size ($M)$250 $225 $218 $200$200 $187 $159 $155 $150$150 $141 $114 $100$100 $50$50 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012* Exit Year *Through 6/30/2012 Source:PitchBook
  16. 16. Links for PitchBook ExitCharts PitchBook users can click the links below to load the corresponding chart directly into the PitchBook Platform for further customization How to view in PitchBook:Slide 14 – PE Exits (count) 1) Right click on the linkClick to customize chart in PitchBook 2) click ‘open hyperlink’ 3) Log-in to PitchBookSlide 15 – PE Median Exit SizeClick to customize chart in PitchBook Source:PitchBook
  17. 17. Despite relatively strongactivity, PE exit flow stillneeds to increase in order todrive down the agingcompany inventory. Source:PitchBook
  18. 18. PE Exits Should Increase in 2H 2012 with More Than 4,000 Portfolio Companies 3 Years or Older to Exit Number of U.S. Private Equity Company Inventory by Deal Year 7,000 6,219 6,238 5,920 6,000 5,563 5,266 Year of 5,000Number of PE-Backed Companies 4,641 Investment 4,000 3,759 2009 - 2012* 2,945 3,000 2005 - 2008 2,261 2,000 2000 - 2004 1,000 0 2004 2005 2006 2007 2008 2009 2010 2011 2012* As of Year *Through 6/30/2012 Source:PitchBook
  19. 19. PE firms raised $35 billion in2Q, the second best total inthe last three years. Source:PitchBook
  20. 20. U.S. PE Fundraising Increases for First Time in a Year Number of Funds Closed and Total Capital Raised by Quarter$120 140 126 120$100 63 100$80 62 47 80$60 51 54 60 42$40 31 37 37 33 34 35 40 31 31 30 28$20 13 20 $99 $94 $74 $41 $75 $36 $12 $30 $30 $22 $25 $11 $50 $29 $22 $22 $20 $35 $0 0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 2008 2009 2010 2011 2012 Capital Raised ($B) # of Funds Closed Source:PitchBook
  21. 21. Funds $500 Million and Below Represent Over Half of all PE Funds Closed in 2012 Percentage of U.S. P.E. Funds (count) by Fund Size100%90%80%70%60%50%40%30%20%10% 0% 2006 2007 2008 2009 2010 2011 2012* Under $100M $100M-$250M $250M-$500M $500M-$1B $1B-$5B $5B+ *Through 6/30/2012 Source:PitchBook
  22. 22. Average Fund Size Continues Recent Upward Trend Average Fund Size ($M)$1,400 $1,216$1,200 $1,120 $1,031$1,000 $925 $894 $823 $800 $635 $605 $591 $597 $600 $395 $400 $200 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Vintage Year *Through 6/30/2012 Source:PitchBook
  23. 23. Time Spent Fundraising Falling in 2012 Average Time to Close U.S. PE Funds 20 19 18 18 16 15 14 14 13 12 12 12Number of Months 12 10 8 6 4 2 0 2005 2006 2007 2008 2009 2010 2011 2012* # of Months to Close *Through 6/30/2012 Source:PitchBook
  24. 24. Links for PitchBook Deal Flow Charts PitchBook users can click the links below to load the corresponding chart directly into the PitchBook Platform for further customizationSlide 20 – PE fundraising by quarter How to view in PitchBook:Click to customize chart in PitchBook 1) Right click on the link 2) click ‘open hyperlink’Slide 21 – PE fundraising (count) by size bucket 3) Log-in to PitchBookClick to customize chart in PitchBook Source:PitchBook
  25. 25. Additional Charts Source:PitchBook
  26. 26. The Midwest Leads Q2 PE Deal Flow with 65 Deals Percentage of Deal Volume (count) by Region Mid Atlantic West Coast 9% 16% 2Q 2012 Southwest 2% 12% 17% 21% Midwest 2% 20% 2Q 2011 19% 17%Southeast 5% 4% 14% 13% Mountain 14% 15% Northeast South Source:PitchBook
  27. 27. B2B and B2C Account for 57% of PE Deal Activity Percentage of Deal Volume (count) by Industry Materials and 2Q 2012 Resources Business Products and 5% Services (B2B) 35% 2Q 2011Information Technology 13% 5% 29% 15% 13% 13% 22% Healthcare 9% 7% 7% 22% Consumer Products 5% and Services (B2C) Financial Services Energy Source:PitchBook
  28. 28. Deals Under $250M Account for 83% of Deal Flow Percentage of Deal Volume (count) by Deal Size Range100%90%80%70%60%50%40%30%20%10% 0% 2004 2005 2006 2007 2008 2009 2010 2011 2012* Under $50M $50M-$250M $250M-$500M $500M-$1B $1B-$2.5B $2.5B+ *Through 6/30/2012 Source:PitchBook
  29. 29. Exit Strategies Stay Consistent with Long Term Averages Percentage of P.E. Exit Volume (count) by Exit Type100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012* Corporate Acquisition IPO Secondary Buyout *Through 6/30/2012 Source:PitchBook
  30. 30. Funds Over $1B Account for Increased Share of Fundraising Percentage of U.S. P.E. Funds (capital) by Fund Size 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% * 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Under $100M $100M-$250M $250M-$500M $500M-$1B $1B-$5B $5B+ *Through 6/30/2012 Source:PitchBook
  31. 31. Links for PitchBook Deal Flow Charts PitchBook users can click the links below to load the corresponding chart directly into the PitchBook Platform for further customizationSlide 28 – PE deal flow (count) by regionClick to customize chart in PitchBook How to view in PitchBook:Slide 29 – PE deal flow (count) by industry 1) Right click on the linkClick to customize chart in PitchBook 2) click ‘open hyperlink’Slide 30 – PE deal flow (count) by size bucket 3) Log-in to PitchBookClick to customize chart in PitchBookSlide 31 – PE Exits % (count)Click to customize chart in PitchBookSlide 32 – PE fundraising (capital) by size bucketClick to customize chart in PitchBook Source:PitchBook
  32. 32. VIDEO: Better Intelligence & Fund Benchmarking with the PitchBook Platform In this video, you’ll learn how to: • Access the most robust database on PE and VC fund returns. • Create fund benchmarks that match your fund’s peer group. • Use our fully transparent data to validate your benchmark. WATCH NOW: www.pitchbook.com/videos/better-benchmarking.html

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