private equity 2012 review

PRIVATE EQUITY

2012 Review &2013 outlook

January 2013

fundraising overviewA snapshot of 2012 fundraising data and fund launch predic-tions for 2013.Pages 3-5

LP CoMMiTMenTsInvestors’ alloca-tion strategies and calendar dates for the coming year.Pages 6-7

BuYouT deaLsGlobal buyout trans-actions during 2012 by sector, size and geography.Page 8-9

venTure rounds Global venture capi-tal deals by sector, size and geography.Page 10-11

exiTsA round-up of trade sales, secondary buyouts and IPOs.Page 12-13

ToP iPosA glance at 2012’s largest private equity and venture-backed IPOs.Page 14

voiCesGPs and LPs share their views on the past year and give predictions for 2013. Pages 15-17

news TrendsA look at the most mentioned terms in 2012’s private equity news coveragePage 18

MONTH ACTIONS

JANRepublican presidential candidate and Bain Capital co-founder Mitt Romney releases his tax return, showing he paid an effective tax rate of 13.9 percent on income of $21.6 million in 2010.

Ripplewood Capital-backed Hostess Brands files for bankruptcy protection.

FEBNigel Doughty, co-founder of British private equity firm Doughty Hanson, dies aged 54.

A consortium that includes Apollo Global Management agrees to buy eP energy for $7.2 billion, in what will be the largest buyout of the year.

MAR

u.S. President Barack obama signs the Jobs Act into law, easing iPo registration requirements for start-ups and promising changes to how funds can be marketed.

Morgan Stanley Private equity Asia makes its largest-ever investment, with its $300 million backing of China’s tianhe Chemicals Group.

Zayo Group announces a $472 million equity round of funding, the largest of 2012.

APR Behrman Capital proposes a secondary deal to investors to keep some of the companies in its 2001 fund alive, follow-ing the lead of willis Stein & Partners, which offered a similar deal to its lPs in February.

MAY

Accel Partners, tiger Global Management and Digital Sky technology offer some of their shares in Facebook as the social network company goes public. its shares subsequently tank, stifling vC-backed iPos for months.

Carlyle Group goes public, following oaktree Capital’s iPo a month earlier.

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.

Scott Schoen leaves buyout firm thomas H. lee Partners after 26 years.

JUN

european venture firm DN Capital earns a 20x return on its sale of u.k. mobile platform Apsmart to thomson Reuters.

kkR agrees to sell a stake in Alliance Boots to walgreens in what will be the biggest exit of the year.

Joseph Rice iii, aged 80, steps down as chairman of Clayton, Dubilier & Rice.

JUL Bain Capital completes the fundraising for its $2.3 billion second Asia fund.

AUG Bain Capital co-founder Mitt Romney is formally nominated as the Republican u.S. presidential candidate.

SEPT

Both Providence equity Partners and CvC Capital Partners agree to sell stakes in their management companies to large limited partners.

PAG announces a final close on $2.4 billion for its debut private equity fund, an Asia-focused buyout vehicle that will principally target China deals.

Bain Capital, kkR and Merrill lynch are accused of price fixing in a lawsuit brought by the ex-shareholders of hospital management firm HCA.

OCT

Blackstone Group closes what is believed to be the largest real estate fund ever at $13.3 billion.

Debt issued to fund private-equity dividends reaches $54 billion for this year. Six companies sell Pik-toggle bonds to fund these payouts.

French fund managers predict that President Francois Hollande’s proposed tax increases on carried interest profits may be “the death of private equity in France.”

Paul M. wythes, one of Silicon valley’s earliest venture capitalists as co-founder of Sutter Hill ventures, dies aged 79.

NOV

Advent international raises $10.8 billion for its seventh fund, the largest pool raised for private-equity investments in two years.

terra Firma Capital agreed to buy u.k. defense-employee housing operator Annington Homes from Nomura for $5.1 billion, the third largest private equity deal of the year.

DEC

the Newtown school shooting leads Cerberus Capital Management to put Freedom Group, the largest u.S. gun-maker, up for sale.

Focus Media agrees to be bought by a consortium of investors led by Carlyle Group in a $3.7 billion deal that will be China’s largest leveraged buyout.

CONTENTS TIMELINEclick on orange triangles for interactive features

Bloomberg Brief Private equity 2012 review & 2013 outlook

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FUNDRAISING Click on orange triangles for interactive features

2012 fundraising by region, Type ($ Millions)

43%

12% 4% 6%

6%

13%

8% 8% 27%

10%

9% 11%

4%

14%

3%

22% Buyout

Debt

Fund of Funds

Growth

Other

Real Assets

Real Estate

Secondary

Venture

Source: Bloomberg

# of Funds

Volume

2%

3% 3%

32%

1% 1%

46%

1% 11%

2% 6% 2%

48%

3% 2%

23%

2%

12% Asia Pacific Developed

Asia Pacific Emerging

Asia Pacific Emerging & Developed North America

Latin America and Caribbean Middle East and Africa

Multiple

Source: Bloomberg

# of Funds

Volume

Buyout firms raised $135 billion in 2012. The average size buyout fund was about $700 million. The average size VC fund was about $154 million.

Developing Asia was the most popular emerging market for fundraising in 2012, making up 8 percent of funds raised and 6 percent of capital.

Buyout firms dominate, real estate second funds Targeting Multiple regions are Popular

SHOP FOR PREMIUM RESEARCH, DATA AND NEWS

ASIA PACIFIC DEVELOPED

ASIA PACIFIC EMERGING

EASTERN EUROPE

LATIN AMERICA AND CARIBBEAN

MIDDLE EAST AND AFRICA MULTIPLE NORTH

AMERICAWESTERN EUROPE

ASIA PACIFIC EMERGING & DEVELOPED

GRAND 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 $315,330

Source: Bloomberg. Amounts represent capital closed in 2012. Non-dollar amounts have been converted.

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18


funds That raised More Than $1 Billion and Held final Closes in 2012

FUND NAME STRATEGY REGION SECTOR TOTAL RAISED ($M) PLACEMENT AGENT

1 Blackstone Real estate Partners vii lP Real estate Multiple Real estate $13,300 Park Hill Real estate Group, Merrill lynch Pierce Fenner & Smith, uBS Financial Services, JP Morgan Securities

2 Advent international GPe vii lP Buyout Multiple Generalist $8,500 None3 BC european Capital iX Buyout Multiple Generalist $8,359 None

4 Global infrastructure Partners ii lP Real Assets Multiple infrastructure $8,250 Mitsubishi Corp Asset Management, Credit Suisse Securities

5 AXA Secondary Fund v lP Secondary Multiple Generalist $7,100 None6 Green equity investors vi lP Buyout North America Generalist $6,250 None7 Coller international Partners vi lP Secondary Multiple Generalist $5,500 None8 oaktree opportunities Fund iX lP Debt Multiple Generalist $5,000 None9 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 None10 GSo Capital opportunities Fund ii Debt Multiple Generalist $4,000 None12 American Securities Partners vi lP Buyout North America Generalist $3,640 Greenhill & Co, Phoenix Capital Advisory13 NGP Natural Resources X lP Buyout Multiple energy/Renewables $3,586 None14 vista equity Partners Fund iv lP Buyout Multiple technology $3,500 None15 Denham Commodity Partners Fund vi lP Buyout Multiple energy/Renewables, Materials $3,000 Park Hill Group llC15 Capital international Private equity Fund vi Growth Multiple Generalist $3,000 Mvision Private equity Advisors17 CS Strategic Partners v lP Secondary Multiple Generalist $2,900 Credit Suisse Securities (uSA) llC18 Avenue europe Special Situations Fund ii Debt western europe Generalist $2,780 None19 Summit Partners Growth equity Fund viii Growth Multiple Generalist $2,700 eaton Partners llC20 New enterprise Associates 14 lP venture North America Generalist $2,600 None20 Partners Group Secondary 2011 lP Secondary Multiple Generalist $2,600 None22 Metalmark Capital Partners ii lP Buyout North America Generalist $2,572 None23 Blackstone energy Partners lP Real Assets Multiple energy/Renewables $2,500 Deutsche Bank Securities, Morgan Stanley Barney24 PAG Asia i lP Buyout Asia Pacific emerging Generalist $2,400 Park Hill Group llC25 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

25 Bain Capital Asia Fund ii lP Buyout Asia Pacific emerging, Asia Pacific Developed Generalist $2,000 None

28 tPG Growth ii lP Growth Multiple Generalist $2,000 tPG Capital BD llC29 Centerbridge Special Credit Partners ii lP Debt Multiple Generalist $2,000 None30 enCap Flatrock Midstream Fund ii lP Real Assets North America energy/Renewables $1,750 None31 Fortress Japan opportunity Fund ii Real estate Asia Pacific Developed Real estate $1,650 Fortress Capital Formation32 Roark Capital Partners iii lP Buyout North America Generalist $1,559 lazard Freres & Co llC33 Baring vostok Private equity Fund v lP Buyout eastern europe Generalist $1,500 uBS Securities33 Andreessen Horowitz Fund iii lP venture Multiple technology $1,500 None35 BlueMountain Credit opportunities Fund i lP Debt Multiple Generalist $1,400 None36 Carlyle energy Mezzanine opportunites Fund lP Debt Multiple energy/Renewables $1,380 None37 oHA european Strategic Credit Fund Debt western europe Generalist $1,350 Credit Suisse Securities (uSA), llC37 Fountainvest China Growth Capital Fund ii lP Growth Asia Pacific emerging Generalist $1,350 uBS Securities39 Morgan Stanley Private Markets Fund v lP Fund of Funds Multiple Generalist $1,300 Morgan Stanley Smith Barney llC

39 Portfolio Advisors Secondary Fund ii lP Secondary Multiple Generalist $1,300 Fortress Group, RBC wealth Mgmt, Morgan keegan, Alternative investments Co.

41 thoma Bravo Fund X lP Buyout North America technology $1,250 None41 Audax Private equity Fund iv Buyout North America Generalist $1,250 None41 kkR Natural Resources Real Assets Multiple energy/Renewables $1,250 None44 Axiom Asia Private equity Fund iii lP Fund of Funds Asia Pacific emerging Generalist $1,150 Probitas Partners44 Prudential Capital Partners iv Debt North America Generalist $1,150 terrain Placement Services46 Patron Capital lP iv Real estate western europe Real estate $1,132 Monument Group inc47 Harvest Partners vi lP Buyout North America Generalist $1,100 Credit Suisse Securities (uSA) llC47 Carlyle uS equity opportunity Fund lP Buyout North America Generalist $1,100 Foreside Fund Services llC49 Meridiam infra. North America Fund ii lP Real Assets Multiple infrastructure $1,050 Campbell lutyens & Co.

Source: Bloomberg. Non-dollar figures have been converted.

FUNDS

Blackstone 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, closing on 8.5 billion euros, the largest pool raised for private equity investments in two years. The largest venture fund to close in 2012 was New Enterprise Associates 14 LP, which raised $2.6 billion.

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Largest Buyouts of 2012

RANk ANNOUNCE DATE TARGET NAME ACQUIRER NAME SELLER NAME VALUE

($M) SECTOR TARGET LOCATION

1 24-Feb eP energy Global Access industries, Apollo Global Management, korea National oil Corp, Riverstone Holdings el Paso 7,150 energy Houston

2 18-Jul Cequel Communications Holdings BC Partners Holdings, CPPiB 6,580 Communications St. louis3 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

5 16-May open Grid europeAbu Dhabi investment Authority, British Columbia invest-ment Management Corp, eRGo versicherungsgruppe, Macquarie Group, Muenchener Rueckversicherungs

e.oN Se 4,078 utilities Germany

6 5-Dec Primaris Retail Reit kingSett Capital, ontario Pension Board 4,043 Real estate Canada7 25-Jul united technologies units Carlyle Group, BC Partners united technologies Corp 3,460 industrial

8 13-Aug Focus Media Holding CDH investments Fund, China everbright, CitiC Capital Partners, Carlyle Group, Fountainvest Partners 3,427 Media Hong kong

9 15-Aug Getty images Carlyle Group Hellman & Friedman 3,300 Communications Seattle10 17-Feb transunion Corp Advent international Corp, Goldman Sachs Capital Partners Madison Dearborn Partners 3,000 Financial Services Chicago11 5-Jun Party City Holdings thomas H lee Partners 2,690 Retail New York12 26-Nov McGraw-Hill education Business Apollo Global Management McGraw-Hill Cos 2,500 Consumer Products New York13 29-Feb Ahlsell AB CvC Capital Partners Goldman Sachs Group, Cinven 2,404 industrial Sweden14 17-oct Nine entertainment Co Holdings Apollo Capital Management, oaktree Capital CvC Capital Partners Group 2,384 Media Australia

15 26-Nov uSi Holdings Corp onex Corp Goldman Sachs Capital Partners 2,300 Financial Services New York

Source: Bloomberg

U.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.

BUYOUT DEALS

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18


u.s.-Based start-ups get Lion’s share of venture funding

VENTURE ROUNDS click on orange triangles for interactive features

Venture 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 to be sticking to their core competencies, investing in familiar regions and familiar industries.

Communications, Consumer, Tech draw Most vC

Healthcare deals, included largely in consumer non-cyclical, attracted $6.6 billion of capital; and energy/clean energy, about $1.5 billion.

1%

31%

6%

27%

5% 2% 6%

22% 37%

4%

21%

3% 2%

6%

27%

Basic Materials

Communications

Consumer, Cyclical

Consumer, Non-cyclical

Energy

Financial

Industrial

Utilities

Technology

Source: Bloomberg

# of Rounds

Value

north america dominates venture volume

Western Europe attracted the second most capital, with four rounds of $100 million or more: Deezer, CureVac, Mapper Lithography, and Spotify.

77%

1% 7%

2%

13%

72%

1%

6%

3%

18% Africa

N. Amer

CEE

Asia-Pac

MENA

LatAm

W. Europe

Source: Bloomberg

# of Rounds

Value

U.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 of 10. 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


2012’s Largest venture rounds

RANk ANNOUNCED TARGET NAME INVESTORS VALUE ($M) SECTOR TARGET

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 Alarm.com inc technology Crossover ventures 136 Consumer Products virginia

11 6-oct Deezer Access industries llC, indivest Pte ltd 131 e-commerce France

12 10-Apr legend Pictures llC Accel Partners, iDG Capital Partners, Morgan Stanley investment Management, thiel Capital, tomorrow ventures 128 Media California

13 1-Aug Box.net inc Bessemer ventures, DFF Growth, General Atlantic, New enterprise Associates, SAP ventures, Scale venture Partners, Social Capital Partners 125 internet Services California

13 24-Jul NantPharma llC Blackstone Group 125 Pharmaceuticals California

15 18-Jul Fab.com inc Andreessen Horowitz, Atomico, Baroda ventures, DoCoMo Capital, First Round Capital, Mayfield Fund, Menlo ventures, Phenomen ventures, Pinnacle ventures 120 e-commerce New York

16 12-Apr Harvest Power inc American Refining and Biochemical, DAG ventures, Generation investment Management, kleiner Perkins Caufield & Byers, true North venture Partners 110 Renewable energy Maine

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

20 23-Aug Mapper lithography Bv ASM international Nv, Hoving & Partners SA, Parcom Capital Bv, Rusnano, technolution Bv, ADP industries, Demcon 101 Semiconductors Netherlands

Source: Bloomberg, NVCA

Venture 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 fund its purchase of publicly traded AboveNet. The round, from a combination of buyout and venture firms, was led by GTCR LLC.

VENTURE ROUNDS

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18


Largest Portion of exits are from n. amer. Cos.

North America and Western Europe dominated exit volume. Asia lagged, with $7.5 billion of announced exits in 2012.

5% 3%

55% 1%

1%

35%

1%

25%

1%

49%

1% 2%

21% Africa Asia-Pac

CEE-Russia N. Amer

MENA LatAm

W. Europe

Source: Bloomberg

Number

Value

ExITS click on orange triangles for interactive features

Exits 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.

Larger exits dominate volume

Exits classed as large made up 54 percent of volume and 15 percent of exit count in 2012.

12%

16%

2%

16%

15%

9%

1%

42%

33%

Large

Large Midmarket

Mega

Small

Small Midmarket

Source: Bloomberg

Number

Source: Bloomberg Source: Bloomberg Source: Bloomberg Source: Bloomberg Source: Bloomberg

Number

54%

Volume

exit volume declines from 2011

Exit volume lagged deal volume by more than $40 billion in 2012. In 2011, exit volume was almost on pace with deal volume.

0

100

200

300

400

500

600

700

0

500

1000

1500

2000

2500

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Billi

ons

Exit Volume (RHS)

Deal Volume (RHS)

Exit Deal Count (LHS)

Deal Count (LHS)

Source: Bloomberg

Consumer noncyclicals Lead exits

The biggest industry for exits was consumer non-cyclicals, which included KKR’s sale of a stake in Alliance Boots, the biggest exit of the year.

3% 10%

11%

37%

7%

9%

16%

7%

4% 8%

11%

23%

4% 14%

29%

7% Basic Materials

Communications

Consumer, Cyclical


Energy

Financial

Industrial

Technology

Source: Bloomberg

# of Exits

Value

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Largest M&a exits of 2012

RANk ANNOUNCED TARGET SELLER ACQUIRER VALUE ($M) TARGET SECTOR TARGET

LOCATION1 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

3 29-May Gavilon Group General Atlantic, ospraie Management, Soros Fund Management Marubeni Corp 5,600.0 Agriculture omaha, Neb.

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

11 17-Feb transunion Madison Dearborn Partners Advent international, Goldman Sachs Capital Partners 3,000.0 Financial Services Chicago

11 5-Aug Aot Bedding Super Ares Management, otPP Advent international 3,000.0 Consumer Products Atlanta

13 21-May AMC entertainment HoldingsApollo Global Management, Bain Capital Partners, CCMP Capital Advisors, Carlyle Group, Spectrum equity investors, weston Presidio

Dalian wanda Group 2,600.0 Media kansas City, Mo.

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 Sweden

Source: Bloomberg

Exits 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.

ExITS

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18


TOP BUYOUT- AND VENTURE-BACkED IPOs

PRICE DATE

COMPANY NAME

VALUE (USD MIL)

IPO SHARE PRICE

PERCENT CHANGE FROM IPO

TARGET COUNTRY

INDUSTRY GROUP

INDUSTRY SECTOR SELECT BACkERS TYPE

05/17 Facebook inc 16,006.9 38.0 united States internet Communications

Goldman Sachs Group inc/the, Directors & execu-tive officers, DSt Global Solutions ltd, t Rowe Price Group inc, tiger Global Management llC

iPo, Primary Share, Secondary Share, vC Backed, vC exit, Pe Backed, Pe exit

04/20 Haitong Securities Co ltd 1,845.5 10.6 China Diversified

Finan Serv Financial PAG Asia Capital, oman investment Fund, leading investment & Securities Co ltd

local1st, Primary Share, Pe Backed, Hk H Shares

07/12 iHH Healthcare Bhd 1,328.5 2.8 Malaysia Healthcare-

ServicesConsumer, Non-cyclical Abraaj Capital ltd iPo, Primary Share, Secondary

Share, Pe Backed, Pe exit

10/10 Realogy Holdings Corp 1,242.0 27.0 united

States Real estate Financial Apollo Global Management llC, Paulson & Co inc, Directors & executive officers iPo, Primary Share, Pe Backed

03/20 Ziggo Nv 1,235.5 18.5 Nether-lands

telecommu-nications Communications Cinven ltd, warburg Pincus & Co iPo, Secondary Share, Pe

Backed, Pe exit

03/19 DkSH Holding AG 977.7 48.0 Switzer-land Advertising Communications warburg Pincus llC, Cinven Group ltd iPo, Secondary Share, Pe

Backed, Pe exit

07/12 iHH Healthcare Bhd 791.1 1.1 Malaysia Healthcare-

ServicesConsumer, Non-cyclical Abraaj Capital ltd iPo, Primary Share, Pe

Backed, Pe exit

10/11 workday inc 732.6 28.0 united States Software technology Greylock Partners, New enterprise Associates inc iPo, Primary Share, vC Backed

03/14 Allison transmis-sion Holdings 690.3 23.0 united

StatesAuto Parts & equipment

Consumer, Cyclical onex Corp, Carlyle Group iPo, Secondary Share, Pe

Backed, Pe exit

05/03 Petrologistics lP 595.0 17.0 united States Chemicals Basic Materials Pl Propylene llC, lindsay Goldberg & Co llC, York

Capital llC, Petrologistics llC iPo, Primary Share, Secondary Share, Pe Backed, Pe exit

03/21 vantiv inc 575.0 17.0 united States

Commercial Services

Consumer, Non-cyclical Advent international Corp, Fifth third Bancorp iPo, Primary Share, Pe

Backed, Pe exit

09/19 Spirit Realty Capital inc 500.3 15.0 united

States ReitS Financial Highland Capital Management lP, tPG Axon Capital iPo, Primary Share, Pe Backed

03/28 Rexnord Corp 490.3 18.0 united States

Metal Fabricate / Hardware

industrial Apollo Global Management iPo, Primary Share, Pe Backed

04/11 MRC Global inc 477.3 21.0 united States

oil & Gas Services energy Goldman Sachs Group inc iPo, Primary Share, Secondary


10/03 Berry Plastics Group inc 470.6 16.0 united

StatesPackaging & Containers industrial Apollo Global Management llC, Graham Berry

Holdings lP iPo, Primary Share, Pe Backed

04/11 Forum energy technologies inc 435.8 20.0 united

Statesoil&Gas Services energy SCF Partners ltd, Directors & executive officers iPo, Primary Share, Secondary


04/18 tumi Holdings inc 388.7 18.0 united States

Household Products / wares


Directors & executive officers, Doughty Hanson & Co Managers ltd, Stockwell Capital llC

iPo, Primary Share, Secondary Share, Pe Backed, Pe exit

03/16 Ningbo Cixing Co ltd 336.0 35.0 China Machinery-

Diversified industrial Zhejiang Zheshang venture Capital iPo, Primary Share, Pe Backed, China A Shares

06/01 Bros eastern Co ltd 320.6 13.6 China textiles Consumer,

CyclicalCitiC Private equity Fund i/Mianyang Fund, CPeChina Fund lP, Goldenstone investment ltd

iPo, Primary Share, Pe Backed, China A Shares

07/19 Palo Alto Net-works inc 299.5 42.0 united

Statestelecommu-nications Communications Greylock Partners, Sequoia Capital operations

llC, Globespan Capital Partners iPo, Primary Share, Secondary Share, vC Backed

Source: Bloomberg

Top 20 Pe-Backed iPos for 2012

-40%-20%

0%20%40%

Jan Apr Jul Oct

6837 HK

30%

-60%-40%-20%

0%20%

Jan Apr Jul Oct

FB US

Jan Apr Jul Oct

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VOICES By SABRINA WILLMER, ARI LEVy, AND SUSANNAH BIRKWOOD

Terrence Mullen, Partner at arsenal Capital PartnersThe 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 financeStory: 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 LLCStory: 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 systemStory: 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 BoardStory: 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, adveqStory: 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.

Mitt 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 the industry highlights of 2012 and make predictions for the coming year.

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steve Jurvetson, Managing director of draper fisher JurvetsonStory: 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 venturesStory: 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 CapitalStory: 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 associatesStory: 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 HorowitzStory: 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 associationStory: 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 advisorsStory: 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.

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david sze, Managing director at greylock PartnersStory: 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 PartnersStory: 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 angelvestStory: 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 dynamicsStory: 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 asiaStory: 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 asiaStory: 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.

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NEWS TRENDS

Carried Interest, Rubenstein Among Most Mentioned Terms in Private Equity News Coverage

Mitt romney’s Bain Capital Past sparks Carried interest Tax debate

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Number of Stories Mentioning Carried Interest

Source: Bloomberg

BRIEF For the full list of titles visit www.bloombergbriefs.com or BRIEF <GO> on your Bloomberg terminal

Bloomberg Brief publishes 18 groundbreaking daily and weekly newsletters.

Carlyle group founder david rubenstein is 2012’s Most Mentioned Pe executive

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Number of Stories Mentioning David Rubenstein

Source: Bloomberg

Mitt Romney says he has no plans to release his tax returns

Mitt Romney’s campaign releases his tax returns

Obama proposes to tax the debt used in private equity deals

Bain Capital starts raising buyout fund with $6b target

The second Obama-Romney debate is aired, drawing 65.6m viewers

Rubenstein donates $7.5m to fix the Washington Monument

Rubenstein says Mitt Romney’s taxes shouldn’t be criticized

Rubenstein says Korea, Taiwan, Indonesia attrac-tive markets at Bloomberg China event

Carlyle’s founders claimed not to want to sell shares in the firm’s IPO

Carlyle raises $671 million in its IPO

Type NT <GO> ON The TermiNal TO lOOk aT sTOry cOuNTs

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