eur private equity review fy2009

8/14/2019 EUR Private Equity Review FY2009

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European Private Equity

in ReviewFull-year 2009 edition


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Foreword 3

Pan-European private equity 4

Trend graphs 6

Sectors 7Geography 11

European private equity deals 12

European secondary buyouts 14

Private equity activity tables - buyouts 15

Private equity activity tables - exits 16

Financial adviser activity tables - buyouts 17

Financial adviser activity tables - exits 18

Legal adviser activity tables - buyouts 19Legal adviser activity tables - exits 20

Appendix 21

Notes and contacts 23

Contents


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European Private Equity in Review 3

Foreword

The ull-year 2008 edition o this report recognised that the

near collapse o the banking sector had signicantly impaired

the dealmaking ability o nancial investors. However, at the

time there were reasons to be cautiously optimistic and it wassuggested that with valuations sliding, the asset class could

take advantage o distressed vendors and acquire undamentally

sound assets on the cheap.

As it turned out, 2009 was one o the most challenging years

yet aced by private equity with the cost o leverage, availability

o viable targets and price dislocation all emerging as major

obstacles. Even where these challenges were overcome, the

acquisitive aspirations o many unds was curtailed, so pre-

occupied were they with ghting res at portolio company

level. Indeed, highly geared deals that were struck during the

buyout boom began to look ill-timed at best and badly judgedat worst. As such, several private equity houses were orced

to reassess their portolio holdings, selling o some assets

while looking to preserve and create value in other investments

through eective and innovative management.

A back to basics approach by the asset class is one o the most

signicant by-products o the economic downturn and it is no bad

thing. Going orward, private equity volumes will likely continue to

trend upwards although valuations will stay at depressed levelsas sensible mid-market dealmaking becomes the norm. The

heady days o near ree and easy debt are certainly over although

leverage is still obtainable or undamentally sound investments.

Debt packages are now typically widely syndicated with investors

required to inject a greater equity component into transactions.

Despite this, a number o signicant buyouts have been brokered

in recent times, indicating that the larger players are still willing

and able to do deals at the top o the market. KKRs recent

acquisition o Pets At Home or a consideration o almost 1.1bn

and BC Partners move to buy Spotless Group or 600m are just

two very recent examples o the condence returning to the asset

class and must be treated as signs o continued recovery.

We hope you enjoy this ull-year edition o European Private

Equity in Review and, as always, we welcome any comments or

eedback that you may have. I you are interested in sponsorship

o this or any other mergermarket publication, please contact

Simon Elliott.

Tom Coughlan, The Mergermarket Group

mergermarket is pleased to present the ull-year 2009 edition o European Private Equity in Review. This reporthighlights the latest trends within the private equity industry, covering activity in several o the top dealmakingsectors and regional markets across Europe.
mailto:[email protected]:[email protected]


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4 European Private Equity in Review

Pan-European private equity

Such a act is baldly armed by the dismal deal trend guresrom 2009. In the year, buyout and exit transaction volumes

each shrank by nearly 45% to 613 and 283, respectively. This

was only somewhat better than the 64% and 60% decline in total

disclosed transaction values. In absolute terms, buyouts and

exits stood at 28.9bn and 24bn apiece in the year, down rom

80.8bn and 59.6bn in 2008.

Predictably, thereore, the large-cap segment o the buyout

market or transactions valued at 500m or more in 2009

became ar less active than in recent years, comprising just 4%

o total acquisitions by unds in the year, compared to11.3% or

the 2004-2008 period. In the exit market, dealmakers have alsoretreated to the lower end o the market, but overall it has ared

relatively well with large-cap transactions comprising 10.9% o

combined valuations, compared to 13% over the wider period.

The global nancial crisis has not simply impacted upon the

asset class ability to broker transactions at the top end o the

market, however. It has also challenged undamental aspects

o the industry itsel with regards to issues such as undraising,

investment strategies, portolio company management and deal

nancing structures. No doubt some o these challenges will

prove transitory, as will the responses, although others will be

longer lasting in their eects and magnitude.

In a handul o instances, general partners moved to scale

down and even curtail undraising as cash-strapped limited

partners remained unwilling to commit their precious capital.

Most prominently, Candover, a one-time giant o private equity

now hobbled by the nancial crisis, agreed with investors to

terminate its Candover 2008 Fund ater the listed arm o the

buyout house ailed to meet its own 1bn commitment to

the 3bn investment pool. Elsewhere, PAIs general partners

agreed with investors to halve its current PAI Europe V und rom

5.4bn to 2.7bn. Moreover, the Financial Times reported that

the buyout house also made concessions to limited partnersrelating to governance and ee structures, something that would

have been unthinkable in previous years.

These concessions are, o course, symptomatic o abroader shit in the power balance between und managers

and investors. Elsewhere, it has also been reported that

endowments rom Harvard and Yale universities blocked the

Munich-headquartered Nordwind Capital rom investing in

US-based assets in the Pharma, Medical & Biotech space

when the rm went to draw down committed to the und.

Opposition sprang rom the act that such a play was not in

line with the unds initial strategy o investing in turnaround

opportunities in the Germanic region.

But while limited partners are seemingly enjoying some

newound power, many have been orced to sell o privateequity commitments in secondary markets at steep discounts

in a bid to shore up their own cash position and avoid any

orthcoming capital calls. This has hastened a bustling trade in

secondary markets with some private equity rms raising unds

and deploying capital specically to this end. More generally,

investors have been hit hard by the worsening sale environment

and the concomitant all in exit activity which has adversely

impacted upon capital redistributions to limited partners.

It is not surprising, however, that nancial sponsors would

alter investment strategies, holding o exits to ocus instead on

operational eciency and value preservation in existing portoliocompanies. Rather intuitively, the sale price o an enterprise

determines the high exit multiples or which the asset class

is so amed and also the carried interest paid out to general

partners. Understandably, private equity groups were generally

loathe to bring assets to market, particularly in those sectors

more sensitive to the downturn, that would only etch depressed

prices rom opportunistic acquirers. Nevertheless, a number o

hard hit unds aced no choice with the likes o 3i and Candover

moving to dispose o several assets over the course o 2009.

Despite the rally in global equity markets over the second hal

o the year and widespread optimism rom buyout houses,there was a dearth o public listings o portolio rms in Europe

last year. In this respect, 2010 has already seen a number

Looking back, ew in the European private equity industry will remember 2009 with much ondness. It is plainlyclear that last year marked a low-water mark or the industry, so reliant, as it was, on the availability o cheapleverage that uelled the buyout boom. And, as debt capital markets imploded ater Lehman Brothers bankruptcy,private equitys all rom the heights o the pre-crisis period was no less spectacular than the very investmentbanks that unded the dealmaking renzy.


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o aborted foatations o large private equity-backed rms,

suggesting that while the IPO market may recover, it will not

be the quick route to exit that had been previously mooted by

private equity practitioners.

Nonetheless, competition is beginning to rm within the deal

market itsel, particularly among private equity bidders, with a

number o auctions being ercely contested in the rst quarter

o 2010. Stier competition has helped to drive up valuationsand ease the level o price dislocation that had existed between

buy- and sell-side parties, signalling private equitys growing

appetite to broker new deals. Indeed, buyout activity had also

been curbed by widespread market uncertainty, a testing

nancing environment and a general lack o suitable targets.

Where the big buyouts came to market in 2009, it was generally

or deensive assets in more resilient investment niches. In

addition, rms also ound ertile ground or distressed and

opportunistic investments in the ashes let (or created) by the

nancial crisis.

Overall, private equity has had to go back to basics by creatingvalue through managerial expertise and operational eciency

improvements. Firms that relied too much on nancial wizardry

during the boom have clearly struggled without the magic

stardust o debt during the bust. While there have been positive

signs o credit market easing, nancial investors have also had

to employ increasingly creative deal structures in order to bridge

the liquidity gap and get deals over the nish line. This includes,

or example, club deals, the use o deerred earnouts and hybrid

securities. On the creditor side, lenders have teamed up to

nance deals and spread risk through syndicated loans. In the

latest such example, a consortium o banks, including Nomura,

Calyon, KKR Capital Markets and Commerzbank agreed toprovide a 455m (695m) debt package or the 1.10bn buyout

o the British pet retailer Pets at Home, a transaction discussed

in urther detail in the Consumer section below.

Given the challenges that private equity continues to ace, it

is undeniable that the asset class has a signicant role to play

in the economic recovery, primarily by helping to enhance the

eciency and productivity o portolio rms. Nevertheless, amid

this backdrop, the spectre o regulatory reorms emanating

rom Brussels has loomed large in the orm o the Alternative

Investment Fund Managers Directive (AIFM), legislation which

aims to tighten the regulation o the private equity and hedgeund industries. Lobbyists rom country and region-wide trade

bodies, including the British Venture Capitalist Association

(BVCA) and the European Venture Capitalist Association (EVCA),

shot back with measured but rm criticism o the proposals.

Conversely, the two bodies have also tried to ward o any harsh

criticism o regulators rom private equity industry gures

themselves, which could work against a better outcome on

the proposals.

There is arguably little doubt that these pending regulatory

changes are a backlash against the perceived avarice andrecklessness o the Financial Services sector in Europe and

the US. Likewise, there is little doubt that oisting a strict

regulatory burden on private equity will be detrimental to the

industry and its ability to help revitalise economic activity.

Specically, the drat AIFM proposals set out greater

disclosure rom rms, independent valuations o investments

and minimum capital requirements. At a time when margin

pressures are already heightened or many rms, any reorms

that will add increased oversight costs are most unwelcome.

Meanwhile, the proposed regulatory changes in the US are

also relevant or the European deal market in an era wheninternational investment is an everyday occurrence. The Volcker

Rule, as it has come to be known, sets out proposed changes

designed to prevent the problems with institutions that are too

big to ail. I adopted, the Volcker Rule could see investment

banks ofoad hedge und and private equity divisions, ocusing

instead on traditional investment banking activities. At the same

time, other prospective reorms could see private equity rms

based in the US ace urther regulatory scrutiny in the orm o

tighter capital and disclosure requirements.

It is unclear what the nal orm o the regulatory changes

will be and how severely they will aect the nascent recoveryunderway in private equity dealmaking. The major economies

o Europe are just beginning to emerge rom recession and at

very low rates o economic growth. As such, the underpinnings

or a more robust uptick in transaction activity remain ragile.

Private equity deal trends are showing signs o recovery relative

to year-earlier levels, albeit rom a low base o comparison. In

the nal quarter o 2009, or instance, buyout and exit valuations

rose robustly, doubling in the rst instance and nearly trebling in

the second, to 13.59bn and 14.68bn, respectively. Transaction

volumes have not, however, bounced back with the same vigour.

While exits rose by 8.1% year on year in Q4, buyouts were down

by over 10.0% on Q4 2008 levels. Clearly, lingering challengespersist, but the vantage rom today is ar better than it was a

year or even six months ago.

Pan-European private equity


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Buyout and exit trends by volume

Vo

lumeofdeals

400

350

300

250

200

150

100

50

0Q1

2005Q2

2005Q3

2005Q4

2005Q1

2006Q2

2006Q3

2006Q4

2006Q1

2007Q2

2007Q3

2007Q4

2007Q1

2008Q2

2008Q3

2008Q4

2008Q1

2009Q2

2009Q3

2009Q4

2009

Buyouts Volume o deals

Exits Volume o deals

2 per. Mov. Avg. (Buyouts Volume o deals)

2 per. Mov. Avg. (Exits Volume o deals)

Trend graphs

Buyout and exit trends by value

Valueofdeals(m)

100,000

90,000

80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000

0Q1

2005Q2

2005Q3

2005Q4

2005Q1

2006Q2

2006Q3

2006Q4

2006Q1

2007Q2

2007Q3

2007Q4

2007Q1

2008Q2

2008Q3

2008Q4

2008Q1

2009Q2

2009Q3

2009Q4

2009

Buyouts Value o deals (m)

Exits Value o deals (m)

2 per. Mov. Avg. (Buyouts Value o deals (m))

2 per. Mov. Avg. (Exits Value o deals (m))

90

80

70

60

50

40

30

20

10

0Q1

2005Q2

2005Q3

2005Q4

2005Q1

2006Q2

2006Q3

2006Q4

2006Q1

2007Q2

2007Q3

2007Q4

2007Q1

2008Q2

2008Q3

2008Q4

2008Q1

2009Q2

2009Q3

2009Q4

2009

Volume

Value

Secondary buyout trends by volume and value

30,000

25,000

20,000

15,000

10,000

5,000

0

Valueofdeals(m)

Volumeofdeals


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Technology, Media & Telecommunications (TMT)

The European TMT space is replete with a range o diverse,

niche businesses and an array o investment opportunities,

ranging rom the provision o venture and growth capital in

start-up and small-cap companies to mature large-cap assets.

Accordingly, the TMT sector has been a mainstay investment

area or private equity in Europe or many years, and last year

was no dierent.

Indeed, private equity players brokered 76 buyouts in the sector

worth a combined 6.60bn in 2009, making it the ourth most

active buyout market in Europe in terms o deal volume and

the top ranked by value. Likewise, with 57 exits worth 7.53bn

TMT also ranked as the highest value sector or private equity

divestments and the second most active exit market ater the

Industrials & Chemicals space.

While the overall volume and value o TMT buyouts and exits

undertaken by the asset class in Europe ell by nearly a third

against 2008 gures, the sector increased its share o total

private equity transactions to its highest proportion in recentyears. Measuring the volume and value o TMT transactions

to overall private equity deals, the proportion rose appreciably

last year to 15.1% and 20.0%, respectively, up by 1.9 and 3.2

percentage points compared to the aggregated average or the

2004-2008 period.

Tellingly, the sector hosted several o the asset class largest

deals in the year, including the top ranked transaction. In

this deal, BC Partners and Apollo Management divested

respective stakes o 35.3% and 29.1% in Unitymedia GmbH,

the international cable group based in Germany. US-based

trade buyer Liberty Global was involved on the buy-side othe transaction which was valued at a total consideration o

3.50bn, consisting o 2.00bn in cash and the assumption o

1.50bn in Unitymedias debts. This represents an attractive

return or BC Partners and Apollo who had previously acquired

Unitymedia or 1.50bn in 2003.

The largest private equity buyout o the year also came

to market in the TMT space. The transaction saw EQT

Partners team up with GIC Special Investments, the private

equity investment arm o the Singaporean state, to broker

the 2.24bn secondary buyout o Springer Science and

Business Media, the German-based academic publisher inDecember. EQT and GIC respectively acquired 82% and 18%

o the company which, at the time o sale, carried net debt

o approximately 2.20bn. On the sell-side, Candover, the

embattled buyout house struggling to manage its own debts,

and co-investor Cinven were able to exit Springer ahead o loan

renancings that were due to begin maturing in early 2010.

While the Springer Science transaction was an SBO, it proved

to be something o an anomaly as the SBO market actually

shrank in the year to just over 10% o total activity, downrom an average o 16% or the 2004-2008 period as a whole.

Moreover, in this particular deal, the vendors sold rom a

position o distress, with the transaction only made possible by

EQT and GIC managing to inject new equity into the business

and renance its debts, greatly improving Springers capital

structure and uture prospects. Nonetheless, as one o

the biggest LBOs to come to market in Europe in 2009, the

transaction oers hopeul signs or 2010.

Another signicant deal saw Silver Lake Partners lead an

investor consortium which acquired a 65% stake in Skype

Technologies, the Luxembourg-headquartered global Internetcommunications company, or 1.42bn rom eBay Inc. Post-

deal, eBay will retain a 35% stake in the company with the

technology-ocused consortium o investors bringing a wealth

o technological and management expertise to help grow the

business going orward in the ast expanding social media and

technology niche.

As the leading technology private equity house in Silicon Valley,

Silver Lake is the most prominent among the investor consor-

tium, but other partners included institutional investor, Canada

Pension Plan Investment Board, and two venture capital

rms, US-based Andreessen Horowitz and Switzerlands IndexVentures notably, the latter provided backing or Skype in the

days beore it was acquired by eBay.

Consumer

Private equity investment in Consumer businesses abated at

a airly steep pace in 2009, marking the second successive

year o retrenchment in buyout and exit activity in the sector.

Such a trend is o course o little surprise given the sensitivity

many Consumer companies ace to cut backs in discretionary

household expenditure in uncertain economic times.

This is particularly apparent when looking at the raw

numbers. In the year, the asset class brokered just 106

Sectors


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buyouts worth 3.33bn, representing year-on-year declines o

48% and 75% in volume and value terms. Obstacles in the exit

market also saw divestments ebb to just 41 transactionscollectively valued at 4.30bn, down 52% and 60% respectively

compared to the same time period 12 months earlier.

Looking at the Consumer subsectors, buyout and exit activity

was uniormly depressed with little variation between the

Retail, Foods and the broader Other sector, including the

tobacco and beverages, household and personal care items

and luxury goods businesses. That said, this latter segment

saw a noteworthy 8.8% increase in aggregate valuations

over last year on the back o two o the asset class biggest

transactions. Notably, both deals came to market in the

beverages niche, a comparatively deensive investment spacegiven the resilience these companies oten have to down

business cycles.

In the largest such transaction, Blackstone Group Holdings

and Lion Capital exited Orangina Schweppes Group, the French

sot drink maker and distributor, to Japanese strategic investorSuntory Holdings or a consideration o 2.25bn. Blackstone

and Lion Capital initially acquired Orangina Schweppes in early

2005 or 1.85bn and grew the business through inorganic

growth and expansion into new markets.

Financial investors were also involved on the buy-side in the

beverages subsector. The top deal was announced in the

third quarter o the year and witnessed CVC Capital Partners

acquire the Central & Eastern European assets o AB InBev,

the worlds largest brewing company, or US$2.23bn (1.49bn)

with a possible earnout payment o US$800m dependent upon

CVCs return on initial investment. The deal also saw CVCacquire brewing operations in nine countries and a number

o brands, including the Czech label Staropramen. Notably, a

Sectors

Sector split of buyouts by volume

Industrials & Chemicals

Consumer

Business Services

TMT

Pharma, Medical & Biotech

Energy, Mining & Utilities

Financial Services

Construction

Leisure

Transportation

Real Estate

Deence

Agriculture

8.3%

5.7%

5.4%

5.2%

5.1%0.2%2.9%

0.2%1.0%

17.3%

21.7%

14.5%

12.6%

Sector split of buyouts by value

TMT


Transportation

Consumer


Financial Services


Business Services

Construction

Leisure

Agriculture

Real Estate

Deence

22.8%

13.2%

12.9%11.5%

11.2%

9.3%

7.5%

6.9%

3.3%

0.2% 0.1%1.2%

0.1%

Sector split of exits by volume


TMT

Consumer

Business Services


Leisure

Financial Services

Energy, Mining & UtilitiesConstruction

Transportation

Real Estate

Deence

Agriculture

27.2%

20.1%

14.5%

12.7%

8.1%

5.3%

3.2%

2.8%

2.8%

1.8% 0.4%

0.7%0.4%

Sector split of exits by value

TMT

Consumer



Business Services

Real Estate

Financial Services

Transportation

ConstructionLeisure


Deence

31.3%

17.9%

13.1%

10.2%

6.7%

5.4%

5.2%

4.5%

3.3%

1.4%0.9%

0.1%


9/24


syndicate o lenders provided US$1bn in senior debt to nance

the transaction, one o the largest debt packages seen in the

European buyout space last year.

The beverages niche may have been the top spot or large-cap

deals last year, but in the early days o 2010 it appears that

private equity-backed M&A in the Retail niche may be en route

to a strong revival. The 1.10bn management buyout o Pets at

Home, the UK-based retailer o pet products and accessories,

by Kohlberg Kravis Roberts & Co rom Bridgepoint Capital

ranks as the largest global private equity-related deal at the

time o publication.

Moreover, there was strong competition or the asset at

auction rom a host o private equity heavyweight biddersincluding Apax Partners, Bain Capital and TPG. On the sell-

side, Bridgepoint realised an exit multiple o 15.7x EDITDA, an

impressive return in any economic climate, more so when it is

noted that the median exit multiple or private equity-related

deals in 2009 stood at 8x EBITDA.

While private equity investment in the Consumer sector

may recover only gradually in the ace o lingering post-crisis

challenges this year, it is certainly encouraging that 2010 has

got o to a good start or a deal market that has languished in

decline or the past two years.

Financial Services

With the Financial Services industry at the epicentre o the

global economic crisis, it is not surprising that the sector

witnessed a sharp contraction in the volume and value o

private equity-brokered transactions in Europe in 2009.

In the year, the number o buyouts totalled 33 transactions

collectively valued at 2.68bn over last year, down rom 60

Sectors

1,600

1,400

1,200

1,000

800

600

400

200

02005 2006 2007 2008 2009

Buyout deal size by volume

Not disclosed

< 15m15m - 100m

101m - 250m

251m - 500m

> 500m

300,000

250,000

200,000

150,000

100,000

50,000

02005 2006 2007 2008 2009

Buyout deal size by value

15m

15m - 100m101m - 250m

251m - 500m

> 500m

Valueofdeals(m)

800

700

600

500

400

300

200

100

02005 2006 2007 2008 2009

Exit deal size by volume

Not disclosed

< 15m

15m - 100m

101m - 250m

251m - 500m

> 500m

Vo

lumeofdeals

140,000

120,000

100,000

80,000

60,000

40,000

20,000

02005 2006 2007 2008 2009

Exit deal size by value

15m

15m - 100m

101m - 250m

251m - 500m

> 500m

Valueofdeals(m)

Volumeofdeals


10/24


deals worth 9.28bn in 2008. Exit activity was also airly sub-

dued with just nine transactions valued at 1.26bn in 2009,

down by 50.0% and 40.5% in year-on-year terms.

The largest deal transacted by the asset class in the year

saw a consortium o investors including Stone Point Capital,

Hellman & Friedman, Vestar Capital Partners, Crestview

Partners, New Mountain and Caisse de Depot et Placement

du Quebec sell a 57% stake in Paris Re Holdings, the French-listed, Swiss-based reinsurance solutions provider. The

transaction saw Bermuda-based re-insurance provider

PartnerRe acquire the stake in a block purchasing scheme

or a consideration o 1.19bn. PartnerRe already owned

a 7% stake in the company and paid the Swiss companys

shareholders a premium o 12.75% over the traded share

price one day prior to the oer announcement.

Looking ahead, it is possible that a number o drivers may

bolster private equity investment in the sector. Although

Financial Services is a comparatively small deal market or

the asset class in Europe, representing approximately 5% and10% o total European buyout and exit activity in 2009, activity

may be set to increase in the year ahead with buyout houses

eagerly eyeing a number o prospective targets in a sector

that is arguably ripe or consolidation.

In this respect, the UK looks set to be the hotbed o activity

with private equity players gearing up to pounce on assets in

the Financial Services sector. In early 2010, it was announced

that Blackstone will team up with und manager Cambridge

Place to invest in a proposed new retail bank, the Home and

Savings Bank. Cambridge Place is also reportedly in talks

with urther prospective investors including other buyoutrms as well as strategic players.

Elsewhere, Northern Rock, which is set to be split into a good

and bad bank by the UK government, has also reportedly

attracted the attention o private equity houses. The Wall

Street Journal reported that the National Bank o Australia

had received approaches rom the asset class regarding

teaming up or a joint bid or the good bank. In addition to

Northern Rock, buyout houses may be eyeing parts o RBS

and Lloyds Banking Group ater both banks were ordered

to dispose o assets by the EU ater having received bailoutunds rom the UK government.

Lastly, private equity rms themselves may see industry con-

solidation as stronger players take over their weaker rivals.

Candover, struggling under a heavy debt load, is the most

prominent example, having becoming a takeover target itsel.

Elsewhere, Natixis, the investment banking arm o BPCE,

recently announced that it has received a conditional oer

rom AXA Private Equity to acquire parts o its private equity

division. The proposed oer would see AXA acquire iXEN

Partners, NI Partners and Initiative & Finance. Consolidation

may also be driven by regulatory changes as smaller playersmerge to share the costs o compliance to new disclosure

requirements in both the US and Europe.

Sectors


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The UK & Ireland maintained its position as the main hub o deal

activity in 2009 with the largest share o buyouts and exits o any

regional market in Europe. The region witnessed 135 buyouts,

comprising 22.0% o overall acquisitions undertaken by nancial

sponsors in Europe. On the sell-side o the asset class, a total

o 67 exits were announced in the UK & Ireland, accounting or

23.7% o the overall market in this regard.

In terms o deal value, the UK & Ireland also ranked highest or

buyouts with 6.94bn worth o deals coming to the market, rep-

resenting a 24% share o 2009 valuations. However, UK & Ireland

exit valuations were surpassed by both the Germanic region and

France. With 10.20bn in total exit value, the Germanic region

accounted or 42.5% o the overall total, much urther ahead

than France which had exits totalling 5.71bn (23.8% o total exit

value). Notably, activity in these regions was driven by the above-

mentioned Unitymedia and Orangina Schweppes exits.

While this trend obviously refects the act that several o the yearstop private equity transactions were brokered in the Germanic and

French markets, it is noteworthy that these geographies were

also ranked as active or dealmaking, only surpassed by the UK &

Ireland in terms o both buyout and exit volumes.

Elsewhere, the CEE and SEE M&A markets witnessed a relative

dearth o private equity investment activity. Indeed, increasingly

risk-averse western unds generally eschewed bold buyouts in

these regions, preerring to stay closer to home - CVC CapitalPartners acquisition o AB InBevs CEE brewing operations was,

o course, a notable exception.

The gures rom last year show that the CEE region witnessed

36 buyouts collectively valued at 3.37bn. However, the SEE

region saw the ewest number o buyouts with only 11 such

transactions carrying an aggregate value o 419m. The largest

such deal was announced in the rst quarter o the year with

Greece-based investment holding company, Marn Investments,

acquiring the fying activities, MRO assets and ground handling

activities o Olympic Airlines or 177m rom the Government o

Greece. Somewhat unsurprisingly, there were not any exits inthe SEE region in 2009, while the CEE region saw just 13 worth

a combined 595m.

GeographyGeographic split of buyouts by volume

UK & Ireland

Germanic

France

Benelux

Nordic

Iberia

Italy

CEE

SEE

22.1%

17.1%

13.7%

12.1%

11.9%

8.5%

6.9%

5.9%1.8%

Geographic split of buyouts by value

UK & Ireland

Germanic

CEE

Italy

Benelux

Iberia

France

Nordic

SEE

24.1

20.8

11.7

11.2

9.5%

9.3%

6.5%

5.5%1.5%

Geographic split of exits by volume

UK & Ireland

Germanic

France

Nordic

Benelux

Iberia

Italy

CEE

23.7%

21.2

19.1%

13.4%

6.7%

5.7%

5.7%

4.6%

Geographic split of exits by value

Germanic

France

UK & Ireland

Benelux

Nordic

Italy

CEE

Iberia

42.5%

23.8%

17.9%

5.7%

4.7%

2.6%

2.5%

0.3%


12/24


European private equity deals

Top 20 private equity transactions, 2009

Rank Announceddate

Status Targetcompany

Targetsector

Bidder company Bidder description Seller company Dealtype

Dealvalue(m)

1 Nov-09 C UnitymediaGmbH

TMT Liberty Global Inc US-based international cableoperator

Apollo Management LP;BC Partners Ltd

Exit 3,500

2 Nov-09 C OranginaSchweppesGroup

Consumer Suntory Holdings Ltd Japanese beverage producer anddistributor

Blackstone Group HoldingsLLC; Lion Capital LLP

Exit 2,245

3 Dec-09 C SpringerScience +

Business MediaDeutschlandGmbH

TMT EQT Partners AB; GICSpecial Investments

Pte Ltd

Sweden-based private equityrm; Singapore-based

soveriegn wealth und

Candover Investments plc;Cinven Ltd

SBO 2,240

4 May-09 C Enel Rete GasSpA (80% stake)

Energy,Mining &Utilities

AXA Private Equity;F2i SGR SpA

France-based private equityrm; Italian closed-end undocused on inrastructure invest-ments in Italy

Enel Distribuzione SpA IBI 1,716

5 Oct-09 C Gatwick Airport

Ltd

Transpor-

tation

Global Inrastructure

Partners

US-based private equity rm BAA Ltd IBO 1,609

6 Oct-09 C Anheuser-Busch InBev(Central

Europeanoperations)

Consumer CVC Capital PartnersLtd

UK-based private equity rm Anheuser-Busch InBev IBO 1,493

7 Sep-09 C SkypeTechnologiesSA (70% stake)

TMT Silver Lake Partners;Andreessen Horowitz;Canada Pension PlanInvestment Board;

Index Ventures

US-based private equity rm;US-based venture capital rm;Canada-based investmentmanagement rm; Swiss private

equity rm

eBay Inc IBI 1,424

8 Dec-09 C Compagnie laLucette SA

Real Estate ICADE French Real Estate investmentand development company anda unit o the French bank Caissedes Dpts et Consignations

Morgan Stanley Real EstateFund V

Exit 1,299

9 Jul-09 C Paris ReHoldings Ltd

FinancialServices

PartnerRe Ltd International reinsurance group Caisse de Dpt et Placementdu Quebec; Crestview PartnersLP; Hellman & Friedman LLC;

New Mountain Capital LLC; StonePoint Capital LLC; Vestar Capital

Partners Inc

Exit 1,187

10 Dec-09 P Marken Ltd Transpor-

tation

Apax Partners LLP UK-based private equity rm Intermediate Capital Group SBO 1,080

11 Oct-09 P ConstantiaPackaging AG(75% stake)

Industrials& Chemicals

Sulipo Beteiligungs-verwaltungs GmbH

Austria-based civil-lawpartnership and aliateo One Equity Partners LLC

Constantia Packaging BV IBI 927


13/24


European private equity deals

Top 20 private equity transactions, 2009

Rank Announceddate

Status Targetcompany

Targetsector

Bidder company Bidder description Seller company Dealtype

Dealvalue(m)

12 Dec-09 P Gas NaturalSDG SA(certain gasdistribution

assets inMadrid)

Energy,Mining &Utilities

GALP Energia SGPSSA; Morgan StanleyInrastructure

Portuguese Energy company;US-based alternative investmentarm o Morgan Stanley

Gas Natural SDG SA IBI 800

13 Sep-09 C Invitel HoldingsAS (64.60%

stake)

TMT Mid Europa PartnersLLP

UK-based private equity rm TDC A/S IBI 737

14 Jun-09 C Wood Macken-zie Ltd

BusinessServices

Charterhouse CapitalPartners LLP

UK-based private equity rm Candover Partners Ltd SBO 654

15 Oct-09 P GFKL FinancialServices AG

(80% stake)

FinancialServices

Advent InternationalCorporation

US-based private equity rm IBI 584

16 Jul-09 C AEG PowerSolutions BV

Industrials& Chemi-cals

Germany1Acquisition Ltd

Channel Island-based specialpurpose acquisition vehicleormed or the acquisition ooperating businesses with

principal operations in Germany,Austria or Switzerland

Ripplewood Holdings LLC Exit 582

17 Apr-09 C Strabag SE (25%

stake)

Construc-

tion

Raieisen Holding

Niederoesterreich-

Wien; Haselsteineramily (privateinvestors)

Austrian Financial Services and

holding company; Austria-based

private investors

Rasperia Trading Ltd Exit 494

18 Nov-09 C Gras Savoye &Cie SAS

FinancialServices

Alcee SAS France-based acquisition vehicleormed or the acquisition oGras Savoye SA

Willis Europe BV MBO 474

19 Jun-09 C CintraAparcamientosSA (99.92%stake)

Construc-tion

Ahorro CorporacionInraestructuras 2,SCR, SA; Ahorro Cor-poracion Inraestruc-turas FCR; Assip SGPS

SA; Banco EspiritoSanto de Investimento;ES Concessoes SGPS

S.A; Espirito SantoInrastructure Fund IFundo de Capital de

Risco; Transport Inra-structure InvestmentCompany

Spanish inrastructure undowned by nancial groupAhorro Corporation; Spanishinrastructure und owned bynancial group Ahorro Corpora-

tion; Portugal-based holdingcompany owned by constructiongroup A Silva & Silva; Portuguese

investment bank; Portuguesetransportation concession armo Banco Espirito Santo; Portu-

guese inrastructure und ownedby nancial group Espirito Santo;Luxembourg-based investmentcompany controlled by Portu-guese toll-road operator Brisa,

Portuguese bank BCP, La Com-pagnie Benjamin de Rothschildand its management

Cintra Concesiones deInrastructuras de Transporte SA

IBI 451

20 Dec-09 P British CarAuctions Ltd

Consumer Clayton, Dubilier &Rice Inc

US-based private equity rm Montagu Private Equity LLP SBO 426


14/24


European secondary buyouts

Top 10 secondary buyouts, 2009

Rank Announceddate

Status Target company Target sector Bidder company Bidder description Seller company Deal value(m)

1 Dec-09 C Springer Science+ Business MediaDeutschlandGmbH

TMT EQT Partners AB; GICSpecial InvestmentsPte Ltd

Sweden-based privateequity rm; Singapore-based soveriegnwealth und

Candover Investmentsplc; Cinven Ltd

2,240

2 Dec-09 C Marken Ltd Transportation Apax Partners LLP UK-based privateequity rm

Intermediate CapitalGroup

1,080

3 Jun-09 C Wood MackenzieLtd

BusinessServices

Charterhouse CapitalPartners LLP

UK-based privateequity rm

Candover Partners Ltd 654

4 Dec-09 P British Car

Auctions Ltd

Consumer Clayton, Dubilier

& Rice Inc

US-based private

equity rm

Montagu Private Equity

LLP

426

5 Nov-09 C Web ReservationsInternational Ltd

TMT Hellman & FriedmanLLC

US-based privateequity rm

Ray Nolan (privateinvestor); Summit Part-ners LP; Tom Kennedy(private investor)

228

6 Aug-09 C Kalle GmbH Industrials &Chemicals

Silverfeet CapitalPartners LLP


Montagu Private EquityGmbH

213

7 Jul-09 C Viking MooringsGroup Ltd

Industrials &Chemicals

HSBC Private Equity(UK)


F&C Private Equity Trustplc; Infexion PrivateEquity Partners LLP

208

8 Apr-09 C Bol.Com BV Consumer Flevo DeelnemingenI BV

Netherlands-basedacquistion vehicleormed by Cyrte

Investments

Holtzbrinck NetworksGmbH; VerlagsgruppeWeltbild GmbH

200

9 Jul-09 C FPEE Industries

SA

Construction Barclays Private

Equity Ltd; PragmaCapital

UK-based private equi-

ty rm; France-basedprivate equity rm

AGF Private Equity; AtriA

Capital Partenaires;Euromezzanine ConseilSAS; UI Gestion SA

150

10 Oct-09 C AVG Technologies

CZ sro (25% stake)

TMT TA Associates Inc US-based private

equity rm

Benson Oak; Enterprise

Investors; Intel Capital

137


15/24


Private equity activity tables - buyouts

Buyouts - Volume

Rank Company name Value (m) Volume of deals

1 Lloyds TSB Development Capital 447 12

2 AXA Private Equity 2,086 9

3 EQT Partners 2,619 6

4 Gimv 202 6

5 BLUO SICAV SIF 109 5

6 Advent International 708 4

7 Barclays Private Equity 475 4

8 HgCapital 454 4

9 Waterland Private Equity Investments 436 4

10 Altor Equity Partners 322 4

Buyouts - Value

Rank Company name Value (m) Volume of deals

1 EQT Partners 2,619 6

2 GIC Special Investments 2,240 2

3 AXA Private Equity 2,086 9

4 CVC Capital Partners 1,866 2

5 Global Inrastructure Partners 1,609 1

6 Index Ventures 1,433 2

7= Andreessen Horowitz 1,424 1

7= Silver Lake Partners 1,424 1

9 Apax Partners 1,080 2

10 One Equity Partners 927 1

Note: The tables are based on private equity houses as the bidder on buyouts and buyins announced between 01/01/2009 and 31/12/2009, where the target is European, excluding lapsedand withdrawn deals.

The Private Equity Activity Tables refect the activity o buyout rms, venture capitalists, investment rms, nancial institutions and all parties whose activities wholly involve, or includemaking private equity investments. Please note that the values in the 'Value' column do NOT refect the equity contribution o the investors but represent the total values o deals theywere involved in.


16/24


Private equity activity tables - exits

Exits - Volume

Rank Company name Value (m) Number of deals

1 3i Group 142 11

2 Arques Industries 134 6

3 Cinven 2,240 4

4 NI Partners 159 4

5 NPM Capital 30 4

6 Candover Investments 2,894 3

7 Sonnova Partners 688 3

8 Montagu Private Equity 639 3

9 Gimv 576 3

10 Infexion Private Equity Partners 230 3

Exits - Value


1 BC Partners 3,500 2

2 Apollo Management 3,500 1

3 Candover Investments 2,894 3

4 Lion Capital 2,354 2

5 Blackstone Group 2,245 1

6 Cinven 2,240 4

7= Caisse de Dpt et Placement du Quebec 1,187 1

7= Crestview Partners 1,187 1

7= Hellman & Friedman 1,187 1

7= New Mountain Capital 1,187 1

7= Stone Point Capital 1,187 1

7= Vestar Capital Partners 1,187 1

Note: The tables are based on private equity houses as the seller on exits announced between 01/01/2009 and 31/12/2009, where the target is European, excluding lapsed and withdrawn deals.

The Private Equity Activity Tables refect the activity o buyout rms, venture capitalists, investment rms, nancial institutions and all parties whose activities wholly involve, or includemaking private equity investments. Please note that the values in the Value column do NOT refect the equity contribution o the investors but represent the total values o deals theywere involved in.


17/24


Financial adviser activity tables - buyouts

Buyouts - Volume


1 PricewaterhouseCoopers 413 15

2 KPMG 340 10

3 Deloitte 114 10

4 Ernst & Young 1,777 8

5 Lazard 1,706 8

6 Close Brothers Corporate Finance 552 7

7 BDO Corporate Finance 28 7

8 ING 1,626 6

9 JPMorgan 4,316 5

10 UniCredit Group 3,673 5

Buyouts - Value


1 JPMorgan 4,440 7


3 Ernst & Young 1,777 8

4 Lazard 1,706 8

5 ING 1,626 6



8 KPMG 340 10

9 Deloitte 114 10

10 BDO Corporate Finance 28 7

Note: The tables are based on nancial advisers to the bidder on buyouts and buyins announced between 01/01/2009 and 31/12/2009, where the target is European, excluding lapsed andwithdrawn deals.


18/24


Financial adviser activity tables - exits

Exits - Volume


1 Rothschild 3,573 11

2 Lazard 1,885 8


4 Morgan Stanley 5,799 7

5 Goldman Sachs 4,005 7

6 KPMG 271 7

7 UBS Investment Bank 6,977 6


9 Lincoln International 8 6

10 Jeeries & Company 482 4

Exits - Value


1 UBS Investment Bank 6,977 6

2 Morgan Stanley 5,799 7

3 Nomura Holdings 5,745 2

4 Credit Suisse 4,688 3

5 Goldman Sachs 4,005 7


7 Rothschild 3,573 11

8 JPMorgan 2,501 3

9 Citigroup 2,245 2

10 Royal Bank o Scotland Group 2,245 1

Note: The tables are based on nancial advisers to the seller/target on exits announced between 01/01/2009 and 31/12/2009, where the target is European, excluding lapsed and withdrawn deals.


19/24


Legal adviser activity tables - buyouts

Buyouts - Volume


1 Linklaters 3,800 18

2 Freshelds Bruckhaus Deringer 3,114 14

3 Allen & Overy 2,343 14

4 CMS 749 14

5 SJ Berwin 612 14

6 Ashurst 1,303 11

7 Loyens & Loe 870 11

8 Cliord Chance 1,060 10


10 Poellath & Partners 2,173 8

Buyouts - Value


1 Linklaters 3,800 18


3 Hengeler Mueller 2,476 3

4 Allen & Overy 2,343 14

5 Vinge 2,190 7

6 Poellath & Partners 2,173 8

7 Slaughter and May 1,646 2

8 Sullivan & Cromwell 1,564 3

9 Bojovic Dasic Kojovic 1,493 1

10 Bird & Bird 1,446 2

Note: The tables are based on legal advisers to the seller/target on buyouts announced between 01/01/2009 and 31/12/2009, where the target is European, excluding lapsed and withdrawn deals.


20/24


Legal adviser activity tables - exits

Exits - Volume



2 CMS 1,175 8

3 SJ Berwin 537 8

4 Latham & Watkins 4,154 7

5 Linklaters 870 7

6 Allen & Overy 268 7

7 Weil Gotshal & Manges 2,819 6

8 Lovells 2,313 6

9 Cliord Chance 996 6

10 Baker & McKenzie 318 6

Exits - Value


1 Latham & Watkins 4,154 7

2 Hogan & Hartson 3,500 1

3 Weil Gotshal & Manges 2,819 6


5 Lovells 2,313 6

6 Homburger 1,618 3

7 Cleary Gottlieb Steen & Hamilton 1,547 5

8 Travers Smith 1,506 3

9 De Pardieu Brocas Maei 1,343 2

10 Gide Loyrette Nouel 1,299 1

Note: The tables are based on law rms advising the seller/target on exits announced between 01/01/2009 and 31/12/2009, where the target is European, including lapsed and withdrawn deals.


21/24


AppendixSource data

Buyouts Buyouts Exits Exits

Volume ofdeals

Value of deals(m)

Volume ofdeals

Value of deals(m)

Q1 2005 252 37,881 121 19,952

Q2 2005 312 44,601 173 23,343

Q3 2005 319 39,452 169 29,853

Q4 2005 275 50,835 162 30,319

Q1 2006 307 42,777 161 19,221

Q2 2006 368 70,739 172 21,531

Q3 2006 333 56,575 159 31,337

Q4 2006 356 84,358 176 43,501

Q1 2007 347 42,232 187 41,334

Q2 2007 379 90,375 230 34,411

Q3 2007 323 37,890 164 26,443

Q4 2007 340 47,620 166 22,029

Q1 2008 299 22,095 130 14,168

Q2 2008 349 32,694 163 19,166

Q3 2008 275 19 ,831 122 20,340

Q4 2008 188 6,157 86 5,889

Q1 2009 134 3,503 55 1,407

Q2 2009 147 5,175 69 3,005

Q3 2009 164 6,644 66 4,944

Q4 2009 168 13,598 93 14,682

TOTAL 5,635 755,032 2,824 426,875

Buyouts and exit trends

Volume ofdeals

Value of deals(m)

Q1 2005 44 7,371

Q2 2005 77 12,570

Q3 2005 78 11,334

Q4 2005 64 17,705

Q1 2006 71 9,374

Q2 2006 81 14,820

Q3 2006 70 19,797

Q4 2006 67 26,558

Q1 2007 72 22,214

Q2 2007 83 21,476

Q3 2007 65 14,878

Q4 2007 73 12,666

Q1 2008 54 4,127

Q2 2008 72 8,030

Q3 2008 51 7,815

Q4 2008 26 1,399

Q1 2009 15 521

Q2 2009 20 910

Q3 2009 25 988

Q4 2009 26 4,318

TOTAL 1,134 218,871

SBOs

Buyouts

Volume 2005 2006 2007 2008 2009

Not disclosed 476 610 640 554 341

< 15m 137 134 137 114 89

15m - 100m 302 330 328 289 126

101m - 250m 112 128 107 79 36

251m - 500m 62 66 65 43 10

> 500m 69 96 112 32 11

TOTAL 1,158 1,364 1,389 1,111 613

Deal size split

Buyouts

Value 2005 2006 2007 2008 2009

< 15m 1,206 1,218 1,264 1,049 816

15m - 100m 12,601 14,178 14,031 11,884 5,317

101m - 250m 18,432 20,717 16,871 12,643 5,869

251m - 500m 22,475 24,241 22,720 14,885 3,654

> 500m 118,055 194,095 163,231 40,316 13,264

TOTAL 172,769 254,449 218,117 80,777 28,920

Exits

Volume 2005 2006 2007 2008 2009

Not disclosed 197 232 263 207 142

< 15m 64 49 60 49 37

15m - 100m 168 182 216 133 60

101m - 250m 96 96 87 52 24

251m - 500m 52 50 46 28 12

> 500m 48 59 75 32 8

TOTAL 625 668 747 501 283

Exits

Value 2005 2006 2007 2008 2009

< 15m 611 474 545 483 362

15m - 100m 8,315 8,269 10,066 5,684 2,653

101m - 250m 15,310 15,250 13,842 8,135 4,142

251m - 500m 18,773 18,584 16,155 9,608 4,094

> 500m 60,458 73,013 83,609 35,653 12,787

TOTAL 103,467 115,590 124,217 59,563 24,038


22/24


Appendix: source data

Buyouts

Volume of deals Value of deals (m)

Industrials & Chemicals 133 3,227

Consumer 106 3,334

Business Services 89 1,986

TMT 77 6,606

Pharma, Medical & Biotech 51 2,164

Energy, Mining & Utilities 35 3,810

Financial Services 33 2,676

Construction 32 952Leisure 31 344

Transportation 18 3,723

Real Estate 6 35

Deence 1 15

Agriculture 1 48

Sector split o buyouts 2009

Exits


Industrials & Chemicals 77 3,148

TMT 57 7,525

Consumer 41 4,304

Business Services 36 1,620

Pharma, Medical & Biotech 23 2,452

Leisure 15 334

Financial Services 9 1,255

Energy, Mining & Utilities 8 224Construction 8 782

Transportation 5 1,080

Real Estate 2 1,299

Deence 1 15

Agriculture 1 -

Sector split o exits 2009

Buyouts


UK & Ireland 135 6,941

Germanic 105 5,984

France 84 1,880

Benelux 74 2,734

Nordic 73 1,584

Iberia 52 2,674

Italy 42 3,220

CEE 37 3,366

SEE 11 419

Geography split o buyouts 2009

Exits


UK & Ireland 67 4,309

Germanic 60 10,208

France 54 5,712

Nordic 38 1,139

Benelux 19 1,379

Iberia 16 79

Italy 16 617

CEE 13 595

SEE 8 782

Geography split o exits 2009


23/24


Notes & contacts

The ollowing notes pertain to data contained in this

publication:

Dealsincludedarebuyoutsorexitswherethedealvalueis

greater than or equal to 5m.

Wherenodealvaluehasbeendisclosed,dealsareinclud-

edi the turnover o the Target is greater than or equal to

10m, or i the Target employs more than 100 people.

Dealsareincludedwithintheanalysis,chartsandgraphsor each section i the dominant geography o the Target is

in the country or region specied.

PleaserefertoindividualnotesbeneatheachActivityTable

or the precise criteria by which each table has been run.

TheSectorTrendanalysisisbasedondealsusingthe

dominant industry o the target.

mergermarket contacts:

Elias Latsis

Head o Research

T: +44 (0)20 7059 6100

E: [email protected]

Simon Elliott

Publisher, Remark

T: +44 (0)20 7059 6100

E: [email protected]

Remark

Remark, the publishing, market research and events division

o The Mergermarket Group, oers a range o services that

give clients the opportunity to enhance their brand prole,

and to develop new business opportunities within their target

audience. Remark achieves this by leveraging o The Merg-

ermarket Groups core intelligence and connections within

the nancial services and corporate markets. Remark pub-

lishes over 50 thought leadership reports and holds over 70events across the globe each year which enable its clients to

demonstrate their expertise and underline their credentials in

a given market, sector or product.

Visit www.mergermarket.com/remark/ or

www.mergermarket.com/events/ to nd out more.


24/24

This publication contains general inormation and is not intended to be comprehensive nor to provide nancial, investment, legal, tax or other proessional advice or services.This publication is not a substitute or such proessional advice or services, and it should not be acted on or relied upon or used as a basis or any investment or other decisionor action that may aect you or your business. Beore taking any such decision you should consult a suitably qualied proessional adviser.

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