Pitch book pe_trends_3q2012_presentation_deck

Private Equity Trends 3Q 2012Presentation Slide Deck

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Source:PitchBook

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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


*

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

https://my.pitchbook.com/?pcc=10178-29





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





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






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


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



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















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