PEREP_ Analytics TM

NORWEGIAN VENTURE CAPITAL & PRIVATE EQUITY ASSOCIATION (NVCA)  

PRIVATE EQUITY FUNDS IN NORWAY

ACTIVITY REPORT 2013

(SEED – VENTURE – BUY OUT)

PEREP_ Analytics TM

ABOUT THE ACTIVITY REPORT 2013

§  The Activity Report 2013 is developed for the Norwegian Venture Capital & Private Equity Association (NVCA) by Menon Business Economics and PEREP_Analytics during March 2014.

§  The survey covers activities in:

–  Norwegian private equity funds:

–  Foreign private equity funds with advisory teams located in Norway

–  Foreign private equity funds with investments in Norway:

§  The report contains information on:

–  Investments and divestments at cost in portfolio companies located in Norway and abroad

–  Fundraising activity in Norwegian private equity firms

§  Figures are collected quarterly

§  Figures are reported directly from the private equity firms

2  

PEREP_ Analytics TM

ON THE COMPATABILITY WITH EUROPEAN STATISTICS

NVCA defines a «Norwegian private equity firm» as a firm with headquarters located in Norway.

This definition differs from the EVCA definition, which defines a private equity firm on the basis of where the advisory team responsible for the investment and divestment is located.

Due to the discrepancy in definition the EVCA and the NVCA statistics are not completely compatible.

The advantage of the NVCA definition is that the investment and divestment activity is compatible with the fundraising statistics. In addition, the NVCA definition is in line with what is commonly perceived as the Norwegian private equity industry.

Two examples of how the NVCAs definition applies on the statistic:

1.  Investments made from the Swedish office of a Norwegian headquartered PE firm would be defined as Norwegian

2.  Investments made from the Norwegian office of a Swedish headquartered PE firm regards as an investment made by a foreign located private equity fund.

3  

PEREP_ Analytics TM

MAIN OBSERVATIONS 2013

§ Fewer and bigger deals as 2013 had the highest level of buyout investments by

Norwegian PE firms, and the lowest number of initial and follow-on investments, since 2007.

§ 2013 had the highest level of initial investments in Norwegian portfolio companies by foreign PE firms ever.

§ 2013 had the highest level of trade sales from Norwegian PE firms to industrial buyers since 2007. 5 of the industrial sales were initially seed companies.

4  

PEREP_ Analytics TM

FUNDRAISING IN 2013 – NORWEGIAN PRIVATE EQUITY FUNDS

Total fundraising NOK 6,0 bn (EUR 750 mill), compared NOK 2.0 bn. (EUR 250 mill.) in 2012

Venture:

–  First closing of Northzone VII of NOK 1.2 bn (EUR 150 mill)

Buyout:

–  FSN IV NOK 4.8 bn (EUR 600 mill)

Seed:

–  Two new seed funds with governmental loan capital are expected to have their final closing in H1 2014.

–  The funds will be managed by Proventure Management and Alliance Venture Spring.

5  

PEREP_ Analytics TM

INVESTMENTS BY NORWEGIAN PE FIRMS 2013 (INDUSTRY STATISTICS) 6  

Overall:

§  Norwegian PE firms invested 6 019 mill. NOK (EUR 752 mill.) in Norwegian and foreign portfolio companies. –  4131 mill. NOK (EUR 516 mill.) in Norwegian enterprises

–  1889 mill. NOK (EUR 236 mill.) in foreign enterprises

Seed:

–  17 mill. NOK (EUR 2,2 mill.) invested. Up from 14 mill. NOK (EUR 1,7 mill.) in 2012.

Venture

–  765 mill. NOK (EUR 96 mill.) invested. Down from 1 132 mill. NOK (EUR 142 mill.) in 2012.

Buyout:

–  5 237 mill. NOK (EUR 655 mill.) invested. Up from 3 647 mill. NOK (EUR 456 mill.) in 2012.

PEREP_ Analytics TM

INVESTMENTS IN NORWEGIAN PORTFOLIO COMPANIES BY NORWEGIAN AND FOREIGN PE FIRMS 2013 (MARKET STATISTICS)

Overall:

§  12 817 mill. NOK (EUR 1 602 mill.) invested in Norwegian entreprises by both Norwegian and foreign PE firms –  Norwegian PE firms invested 4 131 mill. NOK (EUR 516 mill.)

–  Foreign PE firms invested 8 686 mill. NOK (EUR 1085 mill.)

Seed:

–  A total of 9.9 mill. NOK (1.2 mill. EUR) invested, up from 7.5 mill. NOK (EUR 0.9 mill) investment in the seed segment in 2012.

Venture:

–  A total of 519 mill NOK (EUR 65 mill) invested, down from 875 mill. NOK (EUR 109 mill) in 2012.

Buyout:

–  A total of 12 289 mill. NOK (EUR 1 536 mill.) invested, up from 6 357 mill. NOK (EUR 795 mill ) in 2012.

7  

PEREP_ Analytics TM

DIVESTMENTS (EXITS) 2013

§  Divestments in Norwegian and foreign enterprises by Norwegian PE firms –  54 divestments by Norwegian PE firms. Up from 44 in 2012.

–  10 divestments within the seed stage. Up from 1 in 2012.

–  26 divestments within the venture stage. Down from 29 in 2012.

–  18 divestments within the buy out stage. Up from 14 in 2012.

–  34 out of 54 divestments were sales to trade buyers.

§  Divestments in Norwegian enterprises by Norwegian and foreign PE firms

–  68 divestments in Norwegian enterprises. Up from 43 in 2012.

–  10 divestments within the seed stage. Up from 1 in 2012.

–  20 divestments within the venture stage. Down from 25 in 2012.

–  38 divestments within buyout. Up from 17 in 2012.

8  

PEREP_ Analytics TM

APPENDIX Graphs and charts:

Fundraising

Investments

Divestments  

 

PEREP_ Analytics TM

FUNDRAISING

PEREP_ Analytics TM

NUMBER OF ADDITIONAL FUNDS AND COMMITTED CAPITAL BY YEAR 11  

4831  

15257  

924  

4017  

11344  

2005  

6008  

9  9  

7  

2  3  

3  2  

0  

1  

2  

3  

4  

5  

6  

7  

8  

9  

10  

0  

2000  

4000  

6000  

8000  

10000  

12000  

14000  

16000  

18000  

2007   2008   2009   2010   2011   2012   2013  

Num

ber  o

f  new

 fund

s  

Commi0ed

 cap

ital  

New  capital,  mill  NOK  (le:  axis)   Number  of  new  funds  (right  axis)  

PEREP_ Analytics TM

INVESTMENTS

PEREP_ Analytics TM

Norwegian PE firms’ investments in Norwegian and foreign enterprises

(Industry statistics)

PEREP_ Analytics TM

INDUSTRY STATISTICS: TOTAL AMOUNT OF INVESTMENTS IN NORWEGIAN AND FOREIGN ENTERPRISES BY NORWEGIAN PE FIRMS

14  

1670  2091  

1116  

2103  

1076   1381  1889  

4736  3428  

2835  

3706  

2661  

3411  

4131  

0  

1000  

2000  

3000  

4000  

5000  

6000  

7000  

2007   2008   2009   2010   2011   2012   2013  

Mill.  N

OK  

Foreign  company   Norwegian  company  

PEREP_ Analytics TM

INDUSTRY STATISTICS: NUMBER OF INVESTMENTS IN NORWEGIAN AND FOREIGN ENTERPRISES BY NORWEGIAN PE FIRMS

15  

90  122  

89   86   102  45   52  

259   192   262   276  286  

267  210  

0  

50  

100  

150  

200  

250  

300  

350  

400  

450  

2007   2008   2009   2010   2011   2012   2013  

Num

ber  o

f  investm

ents  

Foreign  company   Norwegian  company  

PEREP_ Analytics TM

NORWEGIAN PE FIRMS' TOTAL INVESTMENTS BY PHASE (MILL. NOK) 16  

3596   3222  2455  

4012  

2441  

3647  

5237  

2580  

2049  

1462  

1708  

1256  

1132  

765  

231  

248  

33  

89  

39  

14  

17  

0  

1000  

2000  

3000  

4000  

5000  

6000  

7000  

2007   2008   2009   2010   2011   2012   2013  

Mill.  N

OK  

Buyout   Venture   Seed  

PEREP_ Analytics TM

INITIAL AND FOLLOW UP INVESTMENTS IN NORWEGIAN AND FOREIGN ENTERPRISES BY NORWEGIAN PE FIRMS (MILL. NOK)

17  

3003  2445  

1494  

2826  

1764  

2702  3384  

593   777   962   1186  677   944  

1853  

1241  

715  

605  

802  

394  

361  

259  

1339  1334   858  

906  

862  772  

506  

162  

128  

22  

31  

5  

13  

15  

69  120  

10  58  

34  0  

2  

0  

500  

1000  

1500  

2000  

2500  

3000  

3500  

4000  

4500  

5000  

2007   2008   2009   2010   2011   2012   2013   2007   2008   2009   2010   2011   2012   2013  

IniOal   Follow  up  

Mill.  N

OK  

Buyout   Venture   Seed  

PEREP_ Analytics TM

NUMBER OF INITIAL AND FOLLOW UP INVESTMENTS IN NORWEGIAN AND FOREIGN ENTERPRISES BY NORWEGIAN PE FIRMS

18  

24   21   22   26   27   24   22   16   24   41   37   46   34   21  

69  39   42  

58  33   23   20  

175  183  

231  213  

274  

225  

192  49  

18   8  

14  

2  4   6  

16  

29  

7  14  

6  

2  

1  

0  

50  

100  

150  

200  

250  

300  

350  

2007   2008   2009   2010   2011   2012   2013   2007   2008   2009   2010   2011   2012   2013  

IniOal   Follow  up  

Num

ber  o

f  investm

ents  

Buyout   Venture   Seed  

PEREP_ Analytics TM

TOTAL AMOUNT INVESTED BY SECTOR AND PHASE BY NORWEGIAN PE FIRMS IN 2013 (MILL. NOK)

19  

0  

500  

1000  

1500  

2000  

2500  

Mill.  N

OK  

Buyout   Venture   Seed  

PEREP_ Analytics TM

Investments in Norwegian enterprises by Norwegian and foreign PE firms

(Market statistics)

PEREP_ Analytics TM

MARKET STATISTICS: TOTAL AMOUNT OF INVESTMENTS IN NORWEGIAN ENTERPRISES BY NATIONALITY OF PE FIRM

21  

5266  6395  

3418  

11404  

4711  3828  

8686  

4736  3428  

2835  

3706  

2661  3411  

4131  

0  

2000  

4000  

6000  

8000  

10000  

12000  

14000  

16000  

2007   2008   2009   2010   2011   2012   2013  

Mill.  N

OK  

Foreign  PE  firm   Norwegian  PE  firm  

PEREP_ Analytics TM

MARKET STATISTICS: NUMBER OF INVESTMENTS IN NORWEGIAN PORTFOLIO COMPANIES BY NATIONALITY OF PE FIRM

22  

28  47   47   43   35   45   39  

259  192  

262   276   286   267  

210  

0  

50  

100  

150  

200  

250  

300  

350  

2007   2008   2009   2010   2011   2012   2013  

Num

ber  o

f  investm

ents  

Foreign  PE  firm   Norwegian  PE  firm  

PEREP_ Analytics TM

MARKET STATISTICS: NUMBER OF INITIAL INVESTMENTS IN NORWEGIAN PORTFOLIO COMPANIES BY NATIONALITY OF PE FIRM

23  

15   18  8  

18   18   17   22  

117  

55  

53  

77  

36   39   28  

0  

20  

40  

60  

80  

100  

120  

140  

2007   2008   2009   2010   2011   2012   2013  

Num

ber  o

f  investm

ents  

Foreign  PE  firm   Norwegian  PE  firm  

PEREP_ Analytics TM

TOTAL AMOUNT OF INVESTMENTS IN NORWEGIAN ENTERPRISES BY PHASE (MILL. NOK)

24  

7766   8391  

5080  

13729  

6326   6357  

12289  

2026   1304  

1136  

1335  

1043   875  

519  

209   128  

37  

46  

2   8  

10  

0  

2000  

4000  

6000  

8000  

10000  

12000  

14000  

16000  

2007   2008   2009   2010   2011   2012   2013  

Mill.  N

OK  

Buyout   Venture   Seed  

PEREP_ Analytics TM

INITIAL AND FOLLOW UP INVESTMENTS IN NORWEGIAN ENTERPRISES BY NORWEGIAN AND FOREIGN PE FIRMS (MILL. NOK)

25  

6818  5668  

3480  

9124  

5564   5413  

10595  

948  

2723  1600  

4605  

762   944  1694  

979  

609  

612  

767  

323   208  

98  

1047  

695  

524  

568  

720   667  421  

155  

47  

27  

31  

1   7  

8  

55  

80  

10  

16  

1   0  2  

0  

2000  

4000  

6000  

8000  

10000  

12000  

2007   2008   2009   2010   2011   2012   2013   2007   2008   2009   2010   2011   2012   2013  

IniOal   Follow  up  

Mill.  N

OK  

Buyout   Venture   Seed  

PEREP_ Analytics TM

NUMBER OF INITIAL AND FOLLOW UP INVESTMENTS IN NORWEGIAN ENTERPRISES BY NORWEGIAN AND FOREIGN PE FIRMS

26  

23   24   19   24   23   29   29   18   30  57  

39   38   42   33  

62  32   33  

57  30   24   16  

122   115  

185  178  

227   212  

165  47  

17   9  

14  

1   3   5  

15   21  

6  

7  

2  2  

1  

0  

50  

100  

150  

200  

250  

300  

2007   2008   2009   2010   2011   2012   2013   2007   2008   2009   2010   2011   2012   2013  

IniOal   Follow  up  

Num

ber  o

f  investm

ents  

Buyout   Venture   Seed  

PEREP_ Analytics TM

NUMBER OF INVESTMENTS IN NORWEGIAN ENTERPRISES MADE BY NORWEGIAN AND FOREIGN PE FIRMS BY SECTOR AND PHASE IN 2013

27  

Phase Seed Venture Buyout Total Type of investment/Total Initial Follow up Total Initial Follow up Total Initial Follow up Total   Business related products and industry products 1 1 2 5 7 4 4 12 Business related services and industry services 2 2 3 3 6 8 Chemicals and materials 1 1 1 Cleantech 3 3 49 49 52 Communication 3 22 25 25 Construction 1 8 9 9 Financial services 1 1 1 Fishery and aquaculture 2 2 2 1 3 5 IT 1 1 2 40 42 2 2 4 47 Life Science 1 1 3 29 32 2 6 8 41 Other energy sources 1 2 3 8 1 9 12 Petroleum 3 15 18 1 8 9 27 Retail /consumer services and products 5 4 9 9 Total 5 1 6 16 165 181 29 33 62 249

PEREP_ Analytics TM

AMOUNT INVESTED IN NORWEGIAN ENTERPRISES MADE BY NORWEGIAN AND FOREIGN PE FIRMS BY SECTOR AND PHASE IN 2013 (MILL. NOK)

28  

Phase Seed Venture Buyout Total Type of investment/Total Initial Follow up Total Initial Follow up Total Initial Follow up Total   Business related products and industry products 2 2 8 6 13 899 899 914 Business related services and industry services 4 4 1 090 193 1 283 1 287 Chemicals and materials 1 1 1 Cleantech 5 5 117 117 122 Communication 25 48 73 73 Construction 310 164 474 474 Financial services 18 18 18 Fishery and aquaculture 15 15 2 150 4 2 154 2 169 IT 2 2 6 88 94 423 28 450 547 Life Science 1 1 32 104 136 1 444 28 1 471 1 608 Other energy sources 0 3 3 1 243 1 243 1 246 Petroleum 23 39 62 1 710 1 247 2 957 3 019 Retail /consumer services and products 1 308 32 1 340 1 340 Total 8 2 10 98 421 519 10 595 1 694 12 289 12 817

PEREP_ Analytics TM

DIVESTMENTS

PEREP_ Analytics TM

Norwegian PE firms’ Divestments in Norwegian and foreign enterprises

(Industry statistics)

PEREP_ Analytics TM

NUMBER OF DIVESTMENTS IN NORWEGIAN AND FOREIGN ENTERPRISES (EXCL. WRITE OFFS) BY NORWEGIAN PE FIRMS

31  

20  7   4   9  

16   14   18  

80  

32  30   24  

35  29   26  

11  

4  3   8  

10  

1  10  

0  

20  

40  

60  

80  

100  

120  

2007   2008   2009   2010   2011   2012   2013  

Num

ber  o

f  exits  

Buyout   Venture   Seed  

PEREP_ Analytics TM

NUMBER OF INDUSTRIAL SALES OF NORWEGIAN AND FOREIGN ENTERPRISES (EXCL. WRITE OFFS) BY NORWEGIAN PE FIRMS

32  

5  2   3   2  

7   9  14  

32  

16   13  11  

22  15  

15  

2  

3  1  

1  

3   5  

0  

5  

10  

15  

20  

25  

30  

35  

40  

45  

2007   2008   2009   2010   2011   2012   2013  

No.  indu

stria

l  sales  

Buyout   Venture   Seed  

PEREP_ Analytics TM

NUMBER OF DIVESTMENTS IN NORWEGIAN AND FOREIGN ENTERPRISES BY NORWEGIAN PE FIRMS 2013 BY PHASE

33  

2   4  

14  

3  2   2   2  

1  4  

15  

5  

1  

4  

5  

0  

5  

10  

15  

20  

25  

30  

35  

40  

Write  offs,  including  sales  for  a  nominal  

amount  

FlotaOon  (IPO)   Sale  of  quoted  equity  post  flotaOon  

Other  capital  flows  

Sale  to  another  private  equity  

firm  

Sale  to  management  (buy-­‐back)  

Sale  to  trade  buyers  

Num

ber  o

f  divestm

ents  

Buyout   Venture   Seed  

PEREP_ Analytics TM

Divestments in Norwegian enterprises by Norwegian and foreign PE firms

(Market statistics)

PEREP_ Analytics TM

NUMBER OF DIVESTMENTS IN NORWEGIAN ENTERPRISES BY NORWEGIAN AND FOREIGN PE FIRMS (EXCL. WRITE OFFS)

35  

32  

8   4  11   16   17  

38  

60  

14   20  

20  

27   25  

20  

9  

4   3  

8  

10  1  

10  

0  

20  

40  

60  

80  

100  

120  

2007   2008   2009   2010   2011   2012   2013  

Num

ber  o

f  divestm

ents  

Buyout   Venture   Seed  

PEREP_ Analytics TM

TYPE OF DIVESTMENTS IN NORWEGIAN ENTERPRISES BY NORWEGIAN AND FOREIGN PE FIRMS IN 2013

36  

2   2   2  

14  

20  

3  

2  

4  

1  

13  

5  

1  

4  

5  

0  

5  

10  

15  

20  

25  

30  

35  

40  

Write  offs,  including  sales  for  a  nominal  

amount  

Repayment  of  preference  shares/

loans  

Other  capital  flows   Sale  to  management  (buy-­‐back)  

Sale  to  another  private  equity  firm  

Sale  to  trade  buyers  

Num

ber  o

f  exits  

Buyout   Venture   Seed