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Private Equity Trends 3Q 2012Presentation Slide Deck
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Source:PitchBook
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Source:PitchBook
PE Investment Off to a Slow Start in 2012Number of Deals Closed (orange line) and Total Capital Invested by
Year (blue bars)
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012*$0
$100
$200
$300
$400
$500
$600
$700
$800
$900
0
500
1,000
1,500
2,000
2,500
3,000
3,500
$76 $147 $219 $300 $491 $817 $345 $151 $336 $344 $106
858
1,227
1,694
2,029
2,545
3,035
2,229
1,411
1,870 1,893
666
Capital Invested ($B) # of Deals Closed*As of 6/30/2012
Source:PitchBook
The first half of 2012 got off to a slow start for the PE industry, but 2012 still has time to rebound…
Source:PitchBook
A Slowdown in Private Equity Investment was Not Completely Unexpected
Number of Deals Closed and Total Capital Invested by Quarter
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q2007 2008 2009 2010 2011 2012
$0
$50
$100
$150
$200
$250
$300
0
100
200
300
400
500
600
700
800
900
$171 $187 $202 $256 $118 $73 $115 $40 $50 $22 $28 $51 $65 $82 $69 $120 $87 $80 $84 $93 $55 $51
749796
757 733719
519
595
396
354 334 320
403446 426
419
579
481 497456 459
363
303
Capital Invested ($B) # of Deals Closed
Source:PitchBook
Healthcare and IT Increase Share of Activity Percentage of Deal Volume (count) by Industry
*Through 6/30/20122003 2004 2005 2006 2007 2008 2009 2010 2011 2012
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Business Products and Services (B2B)
Consumer Products and Services (B2C)
Energy
Financial Services
Healthcare
Information Tech-nology
Materials and Resources
*
Source:PitchBook
B2B Led PE Investment in 1H 2012, Followed by IT and B2C
Percentage of Deal Volume (capital) by Industry
*Through 6/30/2012
2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Business Products and Services (B2B)
Consumer Products and Services (B2C)
Energy
Financial Services
Healthcare
Information Technology
Materials and Resources
*
Source:PitchBook
Middle Market Deals Dominate Market SharePercentage of Deal Volume (capital) by Deal Size Range
2004 2005 2006 2007 2008 2009 2010 2011 20120%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Under $50M $50M-$250M $250M-$500M $500M-$1B $1B-$2.5B $2.5B+*Through 6/30/2012
*
Source:PitchBook
Let’s take a closer look at the trends in those deals that have closed…
Source:PitchBook
Add-ons Continue to Represent About Half of Total Buyout Activity
Add-on Deals as Percentage of Buyout Deals
*Through 6/30/2012
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012*0
500
1,000
1,500
2,000
2,500
-10%
0%
10%
20%
30%
40%
50%
60%
289 200 216337
485655
8371084
748
463652 719
250
430
326424
630
863
986
1216
1364
948
523
744735
270
40%38%
34% 35% 36%
40% 41%44% 44%
47% 47%49% 48%
Add-on Non Add-on Add-on % of Buyout
Source:PitchBook
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012$0
$50
$100
$150
$200
$250
$300
$350
$43
$92
$117
$150 $150 $143 $151
$80
$221 $215$200
$130
$191$178 $172
$198
$250
$190
$261
$320
$243
$145
Corporate Acquisition Secondary Buyout
Median Buyout Deal Sizes Decreased in 1H 2012Median Exit Size ($M)
*Through 6/30/2012
*
Source:PitchBook
Slide 3 – PE deal flow by yearClick to customize chart in PitchBook
Slide 5 – PE deal flow by quarterClick to customize chart in PitchBook
Slide 6 – PE deal flow (count) by industry by yearClick to customize chart in PitchBook
Slide 7 – PE deal flow (capital) by industry by yearClick to customize chart in PitchBook
Slide 8 – PE deal flow (capital) by size bucketClick to customize chart in PitchBook
Links for PitchBook Deal Flow ChartsPitchBook users can click the links below to load the corresponding chart directly into the
PitchBook Platform for further customization
How to view in PitchBook:1) Right click on the link 2) click ‘open hyperlink’3) Log-in to PitchBook
Source:PitchBook
Exit activity was down slightly in 2Q but is expected to accelerate through the end of the year.
Source:PitchBook
114 Exits in 2Q 2012 on Par with 2011 Average
Quarterly PE Exits by Corporate Acquisition, IPO and Secondary Sale
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 2Q2006 2007 2008 2009 2010 2011 2012
-
20
40
60
80
100
120
140
160
180
200
117
94
114
155
131 127
147
131
100
85
119
59
36
55 49
80 87
112
92
175
100
122 120 129
136
114
Corporate Acquisition IPO Secondary Buyout
Source:PitchBook
Median Exit Size has Dropped 11% since 2010
Median Exit Size ($M)
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012$0
$50
$100
$150
$200
$250
$50
$114
$141$150
$159
$187
$155
$100
$225$218
$200
Exit Year
*Through 6/30/2012
*
Source:PitchBook
Slide 14 – PE Exits (count) Click to customize chart in PitchBook
Slide 15 – PE Median Exit SizeClick to customize chart in PitchBook
Links for PitchBook ExitChartsPitchBook users can click the links below to load the corresponding chart directly into the
PitchBook Platform for further customization
How to view in PitchBook:1) Right click on the link 2) click ‘open hyperlink’3) Log-in to PitchBook
Source:PitchBook
Despite relatively strong activity, PE exit flow still needs to increase in order to drive down the aging company inventory.
Source:PitchBook
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
2004 2005 2006 2007 2008 2009 2010 2011 2012*0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2,261
2,945
3,759
4,641
5,266 5,563
5,920 6,219 6,238
Total 2
2009 - 2012*
2005 - 2008
As of Year
Num
ber o
f PE-
Back
ed C
ompa
nies
Year of In-vestment
*Through 6/30/2012
Source:PitchBook
PE firms raised $35 billion in 2Q, the second best total in the last three years.
Source:PitchBook
U.S. PE Fundraising Increases for First Time in a Year
Number of Funds Closed and Total Capital Raised by Quarter
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q2008 2009 2010 2011 2012
$0
$20
$40
$60
$80
$100
$120
0
20
40
60
80
100
120
140
$99 $94 $74 $41 $75 $36 $12 $30 $30 $22 $25 $11 $50 $29 $22 $22 $20 $35
126
63
47
42
62
31
13
34
51
3531 31
54
3730
37
28
33
Capital Raised ($B) # of Funds Closed
Source:PitchBook
2006 2007 2008 2009 2010 2011 20120%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Under $100M $100M-$250M $250M-$500M $500M-$1B $1B-$5B $5B+
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 Size
*Through 6/30/2012
*
Source:PitchBook
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$605
$395
$591 $597
$925
$1,031
$1,216
$1,120
$635
$823$894
Vintage Year
Average Fund Size Continues Recent Upward Trend
Average Fund Size ($M)
*Through 6/30/2012
Source:PitchBook
2005 2006 2007 2008 2009 2010 2011 2012*0
2
4
6
8
10
12
14
16
18
20
12
14
12 12
15
1918
13
# of Months to Close
Num
ber
of M
onth
s
Time Spent Fundraising Falling in 2012Average Time to Close U.S. PE Funds
*Through 6/30/2012
Source:PitchBook
Slide 20 – PE fundraising by quarterClick to customize chart in PitchBook
Slide 21 – PE fundraising (count) by size bucketClick to customize chart in PitchBook
Links for PitchBook Deal Flow ChartsPitchBook users can click the links below to load the corresponding chart directly into the
PitchBook Platform for further customization
How to view in PitchBook:1) Right click on the link 2) click ‘open hyperlink’3) Log-in to PitchBook
Source:PitchBook
Additional Charts
Source:PitchBook
The Midwest Leads Q2 PE Deal Flow with 65 Deals
Percentage of Deal Volume (count) by Region
13%
20%
5%
13%15%
17%
2%
17%
Mid Atlantic
Midwest
Mountain
NortheastSouth
Southeast
Southwest
West Coast 9%
21%
4%
14%16%
19%
2%
16%
2Q 2012
2Q 2011
Source:PitchBook
B2B and B2C Account for 57% of PE Deal Activity
Percentage of Deal Volume (count) by Industry
29%
22%
7%9%
13%
14%
5%
Business Products and
Services (B2B)
Consumer Products and
Services (B2C)Energy
Financial Services
Healthcare
Information Technology
Materials and Resources
35%
22%
5%
7%
14%
13%
5%
2Q 2012
2Q 2011
Source:PitchBook
2004 2005 2006 2007 2008 2009 2010 2011 20120%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Under $50M $50M-$250M $250M-$500M $500M-$1B $1B-$2.5B $2.5B+
Deals Under $250M Account for 83% of Deal Flow
Percentage of Deal Volume (count) by Deal Size Range
*Through 6/30/2012
*
Source:PitchBook
Exit Strategies Stay Consistent with Long Term Averages
Percentage of P.E. Exit Volume (count) by Exit Type
2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Corporate Acquisition IPO Secondary Buyout
*
*Through 6/30/2012
Source:PitchBook
2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Under $100M $100M-$250M $250M-$500M $500M-$1B $1B-$5B $5B+
Funds Over $1B Account for Increased Share of Fundraising
Percentage of U.S. P.E. Funds (capital) by Fund Size
*Through 6/30/2012
*
Source:PitchBook
Links for PitchBook Deal Flow ChartsPitchBook users can click the links below to load the corresponding chart directly into the
PitchBook Platform for further customization
Slide 28 – PE deal flow (count) by regionClick to customize chart in PitchBook
Slide 29 – PE deal flow (count) by industryClick to customize chart in PitchBook
Slide 30 – PE deal flow (count) by size bucketClick to customize chart in PitchBook
Slide 31 – PE Exits % (count)Click to customize chart in PitchBook
Slide 32 – PE fundraising (capital) by size bucketClick to customize chart in PitchBook
How to view in PitchBook:1) Right click on the link 2) click ‘open hyperlink’3) Log-in to PitchBook
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