the private equity international awards 2012 2012...

private equity international annual review 201268

tHe Private eQuity international awarDs 2012

Every year, in early December, we sit down and try to draw up the shortlists for our annual awards. And every year, regardless of how busy the market has been, it seems to get more difficult.

It’s not just that it’s tough to settle on a final four options that everyone agrees with (the debate has been known to get a bit heated at times, but as yet no blood has been spilled). The issue is more that it seems increasingly difficult to put firms into particular boxes as more and more institutions morph into global, multifac-eted asset management firms. What con-stitutes a large-cap firm these days? Can a GP win its national category if all its deals have taken place beyond its borders, or should the prize go to a firm that has only been actively domestically? Does it make sense to try and evaluate new deals, when it’s only really on exit that we’ll know how good they were? How do we reflect the achievements of those who have branched out successfully into new strategies? And should LPs doing direct investing count as GPs in some instances?

There are no right answers to any of these questions, of course. For what it’s worth, we tried to focus largely on private equity activity in the region in question – and for new deals, to pick out some exam-ples that involved interesting structures or complex negotiations. And we also left a fifth option for each category up to you, by including a write-in box. That way, if you didn’t agree with our choices, you were free to suggest an alternative.

As usual, the votes poured in by the thou-sands this year. In some cases, the results were in line with expectations: the Carlyle Group was rewarded for a stellar year by winning large-cap firm of the year in North America, while EQT retained the equivalent

title in Europe and Bain Capital took the top honours in Asia (some consolation for an uncomfortable year). Wins in the mid-mar-ket categories for Advent International, Navis Capital and The Riverside Company were also no great surprise given their respective (impressive) market activity.

Other categories were less predictable, however. In China, the Carlyle Group bested local houses for firm of the year. In Europe, Swiss-headquartered Capvis Equity Part-ners won in Germany for the first time, as did HgCapital in the UK; while the EBRD was named as the top LP (ahead of the likes of ATP) and exit of the year went to KKR’s Alliance Boots – once a poster child for boom-era excess. And in the US, the LP of the year category was won not by the ‘usual suspects’ in California, New York or Texas, but by the State of Wisconsin, whose invest-ment board loudly proclaimed its intention to sell out of some the biggest names in the asset class.

All of our winners are to be congratu-lated, because they’ve all earned something very significant: the admiration of their peers. Thanks to all of you who voted; read on to find out why we think our win-ners came out on top. We look forward to another heated debate in December …

P.S. Although these are largely your awards, there is one category that we take it upon ourselves to decide: the PEI leader of the year award, which is designed to recognise those who have gone above and beyond the call of duty to promote the industry’s cause (see opposite page). This year, for the first time, we’ve also introduced a special award for Asia, to reflect the particular impor-tance of strong leadership in these develop-ing markets. We hope you’ll agree that these are both worthy winners.

Shifting sandsWelcome to the Private Equity International Awards 2012 – the only industry awards decided solely by the industry

2012 awarDs

annual review 2012 private equity international 69

leaDers oF tHe year

tHe Private eQuity international leaDersHiP awarD 2012

Ian Armitage might not be as well known to a global audience as a Rubenstein or a Schwarzman. But he’s unquestionably been one of the most significant figures in the development of European private equity.

One of the pioneers of the UK indus-try, Armitage started out at 3i before moving on to run the private equity divi-sion of Mercury Asset Management. Since spinning out that team as HgCapital in 2000, he has succeeded in building a firm with a genuinely differentiated approach – a sector-specific, labour-intensive model that puts substantial resource into boosting portfolio company operations. It was also one of the first firms to branch

out into renewable energy, which it now runs as a separate business line.

Investors clearly like its style: it has accumulated assets worth over £3.6 bil-lion (and with more to come; it’s currently in market with its seventh fund, which is apparently doing well). Armitage officially retired as Hg chairman last year, and he’s clearly leaving the firm in excellent shape (it even won the UK firm of the year cat-egory in the PEI awards for the very first time in 2012 – see p. 80).

Even more impressively, he seems to have pulled off that rare trick in private equity: a seamless succession process. He leaves the reins with Nic Humphries, who took over as managing partner in 2007.

Building a well-established and extremely successful mid-market group is no mean feat in itself, of course. But it’s not the only reason we felt Armitage deserved recognition.

For years now, he has been a tireless and eloquent advocate for the industry’s cause. Even in retirement, he remains actively involved in the British Venture Capital Asso-ciation, and will continue to hold another important advocacy role – as chairman of LPEQ, an association that represents listed private equity groups in Europe. In the ever-approachable, extremely knowledge-able and impeccably-connected Armitage, it couldn’t ask for a better champion.

Ian Armitage, founder and outgoing chairman of HgCapital

tHe Private eQuity international leaDersHiP awarD in asia 2012

This year, Private Equity International is presenting its leadership award to a man who has helped to prove the long-term feasibility of the asset class in India – a market that has prompted many others to retreat with expectations dashed.

Ashish Dhawan launched India-focused ChrysCapital in 1999 and would go on to become a stalwart in this complex, frus-trating but hugely important market.

Under Dhawan, ChrysCapital built up $2.25 billion in assets under management across six India funds, a feat probably not accomplished by any other Indian fund manager. The firm attracted a mix of Asian and Western institutional investors, including Harvard Management Company,

Stanford Management Company and the Rockefeller Foundation.

ChrysCapital has also returned a substantial amount of capital to its LPs: since its first exit in 2002, it has averaged around five exits per year, according to Dhawan.

“For many of the institutional inves-tors, we were their first GP in India. We always thought there was an onus on us to make sure we did a decent job – because if we did a poor job, they would probably come to the conclusion India wasn’t worth investing in.”

“That was our single, largest contribu-tion [to Indian private equity]. We con-vinced investors that this was a market

where if you back the right people and have the right strategy, you can make money,” Dhawan told PEI.

In 2012, Dhawan stepped down as the head of ChrysCapital. He will continue to work on the previous funds but will not lead the firm’s $510 million Fund VI.

Besides his work at ChrysCapital, Dhawan has long been committed to furthering the K-12 education process in India. He will devote more time to the Central Square Foundation, a non-profit, venture-like organisation he founded which helps raise money for education sector projects and acts as an advocate for educational policy.

ashish Dhawan, co-founder and ex-senior managing partner, ChrysCapital

70 private equity international annual review 2012

asiaaMeriCaseMea

tHe Pei awarDs 2012: roll oF Honour

Large-cap firm of the year in europe: eQT

Mid-market firm of the year in europe: Advent International

Limited partner of the year in europe: european Bank for Reconstruction and Development

Secondaries firm of the year in europe: Partners Group

Special situations/turnaround firm of the year in europe: Orlando Management AG

Distressed investment firm of the year in europe: Oaktree Capital Management

Firm of the year in Africa: Actis

Firm of the year in Benelux: Gilde equity Management

Firm of the year in Cee: Mid europa Partners

Firm of the year in France: AXA Private equity

Firm of the year in Germany: Capvis equity Partners

Firm of the year in Iberia: Investindustrial

Firm of the year in Italy: Investindustrial

Firm of the year in MenA: Abraaj Group

Firm of the year in the nordics: eQT

Firm of the year in Switzerland: Capvis equity Partners

Firm of the year in the uK: HgCapital

Firm of the year in Russia: VTB Capital

Fund of funds of the year in europe: BlackRock Private equity Partners

Placement agent of the year in europe: Campbell Lutyens

Mid-cap lender of the year in europe: Partners Group

Large-cap lender of the year in europe: Deutsche Bank

Law firm (fund formation) of the year in europe: SJ Berwin

Law firm (transactions) of the year in europe: Clifford Chance

european deal of the year: Douglas Holdings (Advent International)

european exit of the year: Alliance Boots (KKR)

european secondaries deal of the year: Lloyds portfolio (Coller Capital)

Large-cap firm of the year in north America: The Carlyle Group

Mid-market firm of the year in north America: The Riverside Company

Limited partner of the year in north America: State of Wisconsin Investment Board

Secondaries firm of the year in north America: Landmark Partners

Special situations/turnaround firm of the year in north America: Ares Management

Distressed investment firm of the year in north America: Oaktree Capital Management

Firm of the year in Canada: CPP Investment Board

Firm of the year in Latin America: Rio Bravo

Fund of funds of the year in north America: HarbourVest Partners

Placement agent of the year in north America: eaton Partners

Mid-cap lender of the year in north America: Ge Capital

Large-cap lender of the year in north America: JPMorgan

Law firm (fund formation) of the year in north America: Debevoise & Plimpton

Law firm (transactions) of the year in north America: Kirkland & ellis

north American deal of the year: el Paso (Apollo Global Management)

north American exit of the year: north American Breweries (KPS Capital Partners)

north American secondaries deal of the year: Willis Stein restructuring (Landmark Partners, Vision Capital)

Large-cap firm of the year in Asia: Bain Capital

Mid-market firm of the year in Asia: navis Capital Partners

Limited partner of the year in Asia: Government of Singapore Investment Corp.

Secondaries firm of the year in Asia: Partners Group

Distressed /special situations firm of the year in Asia: Apollo Global Management

Firm of the year in Australasia: Pacific equity Partners

Firm of the year in China: The Carlyle Group

Firm of the year in India: everstone Capital

Firm of the year in Japan: J-Star

Firm of the year in Korea: MBK Partners

Firm of the year in Southeast Asia: navis Capital Partners

Firm of the year in frontier markets: Actis

Fund of funds of the year in Asia: Squadron Capital

Placement agent of the year in Asia: uBS

Lender of the year in Asia: HSBC

Law firm (fund formation) of the year in Asia: O’Melveny & Myers

Law firm (transactions) of the year in Asia: Clifford Chance

Asian deal of the year: Alibaba/Yahoo! (China Investment Corporation, Boyu Capital, CITIC Capital, China Development Bank)

Asian exit of the year: Akindo Sushiro (unison Capital)

Asian secondaries deal of the year: GIC portfolio (CS Strategic Partners)

71annual review 2012 private equity international

tHe Pei awarDs 2012: euroPe

larGe-CaP FirM oF tHe year in euroPe

1. eQT

2. BC Partners3. Cinven

Before the crisis, the idea of EQT winning this category might have seemed implausible. How could a decidedly mid-market Nordic player ever outstrip the growing powerhouses of Western Europe?

But these are different times, and EQT has become a very different beast. As some of Europe’s larger firms have been forced to scale back their ambitions, EQT has been moving up the deal size scale and also adding new strings to its bow – pushing fur-ther into China, developing its infrastruc-ture business and even raising a debt fund.

It’s still going strong in its European heartland, though. As well as selling Gambro to Baxter for SEK 26.5 billion (€3.1 bil-lion, $4 billion), it also won the €1.8 billion battle to buy BSN Medical from Montagu, acquired retail chain Tiger and luxury phone maker Vertu, and attracted new investment for cleaning company ISS.

Some of Europe’s biggest managers may not have considered EQT a direct rival in the past. They certainly do now.

MiD-Market FirM oF tHe year in euroPe

1. Advent International

2. Capvis Equity Partners3. Nordic Capital

It was no surprise to see Advent Interna-tional take the plaudits in the mid-market category. This was a year in which many European firms experienced extremely difficult fundraising conditions, with many forced to downsize, extend or even postpone their offerings altogether. And yet Advent managed to close its latest

buyout vehicle, Advent International GPE VII, at a whopping €8.5 billion – setting a post-Lehman fundraising record, and

trumping some of Europe’s mega-funds into the bargain.

That’s a pretty clear endorsement of the firm’s strategy and track record.

Better still for Advent’s LPs – many of whom re-upped from the previous fund– the firm has not been resting on its laurels since. It has already agreed to three invest-ments from the new vehicle: KMD, a Danish IT company, mattress manufacturers Serta and Simmons, and Cytec Industries’ coating resins business, for which it is expected to pay some $1.15 billion. A year to remember.

liMiteD Partner oF tHe year in euroPe

1. european Bank for Reconstruction and Development

2. ATP Private Equity Partners3. Oxford University Endowment

At a time when many LPs are taking a very conservative approach to their risk profile and their geographical allocations, there is at least one large European institution that’s not afraid to brave new frontiers. The European Bank for Reconstruction and Development, already the largest private equity investor in the CEE and Central Asia, has recently made its first forays in North Africa, with investments in Morocco and Tunisia.

It’s also ploughing ahead with its invest-ment activity in its core markets. All told, the EBRD invested in a total of 11 new private equity vehicles last year, committing a total of €336 million.

And it’s clearly doing so in a very dis-cerning way: as of 31st December 2011, the 10-year returns averaged by its private equity portfolio beat both the Cambridge

Associates and EVCA benchmarks for the region. The EBRD may be making daring strides into new territories – but it seems to know exactly where it’s going.

Deal oF tHe year in euroPe

1. Douglas Holdings (Advent International)

2. CPA Global (Cinven)3. Teleservices Atento Group (Bain

Capital)

Advent shrugged off the widespread wor-ries about European consumer confidence to de-list Douglas Holdings, the German company behind brands including Douglas perfumeries and Thalia bookstores, in a deal worth €1.5 billion.

Advent initially developed its investment thesis with the founding family Kreke, who were the company’s largest shareholders. It then reached an agreement with other large shareholders, paving the way for a voluntary tender offer – which achieved an impressive acceptance rate of more than 96 percent. The price clearly helped: at €38 per share, Advent’s offer represented a premium of 41.6 percent over the average price of Douglas shares in the four weeks to 11 January 2012, the day the takeover rumours first surfaced.

Obtaining debt can be tricky for con-sumer-related investments, but Advent

Morocco: new destination for the EBRD


found a creative solution: a mezzanine structure, which was led by Park Square and supported by Partners Group. All in all, a worthy winner.

eXit oF tHe year in euroPe

1. Alliance Boots (KKR)

2. Ziggo (Warburg Pincus, Cinven)3. StarBev (CVC Capital Partners)

Henry Kravis and George Roberts are fond of saying “any fool” can buy a company – it’s only a successful exit that deserves celebra-tion. So we imagine there was a good dose of the latter when US-based Walgreens paid $4 billion in cash and $2.7 billion in stock for a 45 percent stake in UK pharmacy chain Alliance Boots.

The exit repaid roughly three-quarters of KKR’s original $2.45 billion equity investment. “Our funds have been marked up meaningfully by $1.6 billion because of Alliance Boots,” Scott Nuttall, head of KKR’s global capital and asset management group, said during an earnings call in July 2012. “With co-investments, it’s $2 billion.”

Many onlookers – including ratings agency Moodys – expected this deal (and most others from the same era) to fail. Instead, the company has consistently per-formed well, proving that doing huge deals at the top of the market is not necessarily a prescription for disaster.

seConDaries Deal oF tHe year in euroPe

1. Coller Capital (Lloyds Banking Group)

2. Blackrock (Swiss Re)3. AXA Private Equity (Swedbank)

There were no shortage of good deals to choose from in the category, but UK-based Coller took the top spot after beating off competition from a number of rival groups to acquire a portfolio of private equity assets from UK-state-backed Lloyds (below). At £1.03 billion, it was one of the biggest sec-ondary transactions on record (see p. 18).

It also provided a clear and compelling illustration of Coller’s prominence in the secondaries space. The firm held a final close on its new $5.5 billion fund a few weeks ear-lier, and this deal proved that it was able to successfully deliver complex billion-pound deals all on its own.

As the banking sector continues to shed assets over the coming years – as it surely will in light of various political and regula-tory pressures – that means Coller now boasts the sort of firepower and exe-cution experience that relatively few of its peers can match. A nice place to be.

seConDaries FirM oF tHe year in euroPe

1. Partners Group

2. Coller Capital3. AXA Private Equity

In a closely-fought race, Partners Group came out just ahead of a very strong field. It spent most of the year on the fundrais-ing trail, and with conspicuous success: in

December, it closed a new €2 billion sec-ondaries fund, which was oversubscribed and reached its hard-cap well before the end of the firm’s designated fundraising period.

Partners has already put about one-fifth of this money to work; indeed, it said that it evaluated a record $70 billion-worth of secondary opportunities in 2012, and it’s predicting continued good deal flow in the coming year.

One notable point is that Partners expects to commit a larger proportion of this new fund in Asia than with previous vehicles. The firm already has six offices in the region, and expects to see more oppor-tunities as the market continues to mature. Elsewhere, it plans to target less mature assets that are less subject to exit risks.

DistresseD investMent FirM oF tHe year in euroPe

1. Oaktree Capital Management

2. AnaCap Financial Partners3. TPG

Another year, another pair of wins for Oaktree Capital Management.

As was the case last year (and the year before that, and the year before that), Oaktree has snagged distressed investment firm of the

year honors in both North America and Europe. This time, it earned the

distinction after having spent more than half the year as a publicly traded company.

Although the market’s response to Oak-tree’s initial public offering was muted – at $43, its opening day share price closed at the bottom of its anticipated IPO range – public investors have since developed a taste for the firm. Shares were trading at just over $50 at press time.

In addition to its listing, Oaktree held a final close above target on a $5 billion dis-tressed fund and also launched an emerging markets strategy with the hire of former


Alliance Boots: Boom-era deal in good health


Fintech Advisory president Julio Herrera.

Another stellar year in the life of Howard Marks (right) and his $77 billion investment empire...

sPeCial situations/turnarounD FirM oF tHe year in euroPe

1. Orlando Management

2. Sun Capital Partners3. Better Capital

Amid the chaos in the Eurozone, Orlando Management continued to prove that there are attractive investment opportunities – at least in the German-speaking region where it invests.

The firm backed three businesses in 2012, bringing its latest fund to roughly 10 percent invested. Orlando purchased paper finishing and converting business Paper Sys-tems Group, commercial vehicle supplier Beinbauer Automotive, and manufacturer Schneider Leichtbau, an add-on investment for fuel and emission reduction company LKE Group.

The firm also showed that limited partners love turnarounds. Orlando Management got off to a

fast start in 2012, raising €230 million for its Special

Situations Venture Partners Funds III by the end of March. The firm

hit a final close in just under eight months, once again surpassing its €200 million target.

In its only exit of the year, Orlando sold furniture group Vivonio to Equistone Part-ners. With continued dislocation in Europe, the firm should have no trouble finding more special situations in 2013.

FirM oF tHe year in aFriCa

1. Actis

2. Ethos Private Equity3. The Carlyle Group

There are a lot of big funds now talking about investing in Africa, but Actis remains one of a few that really walks the walk. Having completed its spin-out from UK development finance institution CDC last April, the emerging markets specialist has

demonstrated that the African continent remains core to its strategy: close to 40 percent of its investments are located there. 2012 milestones included an investment in Garden City, Kenya’s largest shopping centre, and support to large-scale energy projects in South Africa and Ivory Coast.

But it’s probably on the exit front that Actis outstripped its peers in 2012. On top of its oversubscribed IPO for Umeme, Ugan-da’s main power distributor, the firm also found eager buyers for its stakes in Banque Commerciale du Rwanda and the Accra Mall – which should certainly come in handy as it hits the fundraising trail this year.

FirM oF tHe year in beneluX

1. Gilde equity Management

2. Advent International3. Waterland

Investing in a bakery business heavily reliant on consumer spending just after a VAT hike may not seem the most obvious thesis. But Gilde Equity Management clearly begs to differ: in October, it acquired Dutch bakery business Pré Pain & Smithuis, reportedly for €100 million, from Fortis spin-off Neon Private Equity. Although the consumer spending climate is undoubtedly tough in The Netherlands, the firm believes it has found a market segment that is growing – the demand for luxury bread rolls is appar-ently rising as supermarkets increasingly compete with independent bakeries.

But Gilde wasn’t finished there: it also invested in Belgian glass producer Sovitec and software company BlueCielo. And on the exit front, it completed the sale of Salad Signature, a producer of convenience food that had doubled in size under the firm’s ownership (thanks in part to a number of add-on acquisitions, including Johma and Westland) to fellow Benelux firm AAC Capital. Anything but a half-baked year. Garden City: fertile ground for Actis



FirM oF tHe year in Central anD eastern euroPe

1. Mid europa Partners

2. Abris Capital Partners3. Penta Investments

Obtaining senior debt may have been a chal-lenge for some in 2012. But that didn’t stop Mid Europa Partners managing to agree a €400 million recapitalisation of T-Mobile Czech Republic in July, a deal that was underwritten by a group of seven local and international banks. It was the largest refinancing in Central and Eastern Europe in the post-Lehman area, and one of the largest in Europe as a whole.

It came as part of a busy year for Mid Europa. The firm agreed the sale of healthcare group LUX MED to Bupa for €400 million; this was the largest private equity transaction in Poland in 2012, and generated a 2.5x return for Mid Europa and its investors. It also bought laboratory diagnostics company Alpha Medical, and acquired a 50 percent stake in Walmark, an independent dietary supplements manu-facturer. A perennial winner in this category, Mid Europa remains the pre-eminent pan-regional private equity player, as far as its peers are concerned.

FirM oF tHe year in FranCe

1. AXA Private equity

2. PAI Partners3. Apax Partners France

Although various prominent figures in the French business world have been wringing their hands about the economic damage done by President Hollande’s new regime, AXA seems to have reacted with little more than a Gallic shrug.

Its most eye-catching French deal in 2012 was the acquisition of Fives Group, for between €800 and €900 million, the

country’s second largest buyout of the year. But this was just one of a string of invest-ments in the country: AXA also bought majority stakes in Ouvêo, BulkyPix and Arkadin, and acquired minority interests in Place des Leads and Sibille Industrie, as well as backing several bolt-on deals at portfolio companies. It also had a strong year on the exit front, selling Alvest to LBO France, Unipex to IK Partners, and its Keolis stake to national railway operator SNCF.

Although its ownership issue remains unresolved, 2012 was clearly business as usual for AXA – despite the economic chal-lenges in its home territory.

FirM oF tHe year in GerMany

1. Capvis equity Partners

2. Deutsche Beteiligungs3. Montagu Private Equity

Two notable exits helped Capvis to tri-umph in the Germany category for the first time. It sold WMF, a German coffee machine company, to Kohlberg Kravis Roberts for approximately $725 million. And together with Partners Group, the firm also offloaded Bartec, a German safety equipment maker to UK-based Charterhouse Capital Partners. This deal

– for which Charterhouse reportedly had to beat off stiff competition from EQT Partners, CD&R and trade player Honey-well International – netted Capvis a return multiple of more than 3x, PEI reported at the time.

Capvis also managed to put fresh capital to work in Germany. In June, the firm acquired Hessnatur, a company that designs and distributes organic and sustain-able home textiles and natural clothing. A month later, it snapped up Ondal Group, a producer of pendant systems for medical applications.

A productive year for Capvis, then – and one that highlighted the benefits of an on-the-ground presence in this challenging market.

FirM oF tHe year in iberia

1. Investindustrial

2. Bain Capital3. Mercapital / N+1

The Spanish and Portuguese economies may still be flatlining, but Investindustrial remains convinced that there is value to be found in this struggling region.

Spain’s subdued consumer spending climate certainly has not persuaded the firm to give up on PortAventura, Europe’s

Keolis: AXA on track



third largest theme park; on the contrary, in 2012 it increased its stake from 50 to 100 percent. Since its original investment in 2009, Investindustrial has managed to double EBITDA at the business, thanks largely to its success in attracting tourists from overseas.

In addition, the Southern European investment firm teamed up with Trilantic Capital Partners to acquire a 48 percent stake in Euskatel, a telecommunications provider in the Basque region. And it completed a successful exit from Con-tenur, an urban waste manufacturer that has also enjoyed substantial expansion during Investindustrial’s ownership. So it has done more than most to demonstrate that buying and selling good assets is still possible in Spain.

FirM oF tHe year in italy

1. Investindustrial

2. AXA Private Equity3. Pamplona Capital Management

For the fourth time in the row, Investin-dustrial has come out on top in Italy – and it’s easy to see why.

Although Italy found itself in the head-lines largely for the wrong reasons in 2012, Investindustrial still managed to impress investors with some notable exits. The high-est-profile was undoubtedly the $1.1 billion sale of storied motorcycle maker Ducati, a deal that yielded a 3x return for the firm and proved that Italian lifestyle brands are still in demand around the world.

This multiple, coupled with a good return from last year’s divestment of engi-neering business Permasteelisa, ensured that Investindustrial had some good num-bers to show LPs when it hit the fundraising trail last year. And sure enough, by the end of the year, the firm was well on track to hit its hard-cap of €1.25 billion. Clearly its track record was enough to convince

investors that there are still good deals to be found in Investindustrial’s heartland.

FirM oF tHe year in Mena

1. The Abraaj Group

2. Gulf Capital3. Fortissimo Capital

Abraaj’s worldwide expansion continues. Less than a year after it acquired Amundi’s North African buyout operations, the firm bought Aureos Capital in February 2012, giving it an immediate presence in many parts of the emerging world. Now with assets under management worth $7.5 billion, Abraaj’s global milestones in the past year included several successful Asian IPOs, as well as a string of deals and exits in Asia, Latin America and Africa. It also remains a power in the MENA region: 2012 saw a $125 million investment in Saham Finance, a Moroccan and West-African-based insurer, and the $36 million first close of its Palestine Growth Capital Fund. The firm also provided its backing to Kuwait Energy, an oil and gas explora-tion and production company, a couple of months later. Abraaj is undoubtedly going global – but it keeps on oiling the wheels closer to home, too.

FirM oF tHe year in tHe norDiCs

1. eQT Partners

2. Nordic Capital3. IK Investment Partners

Perhaps not surprisingly, given its victory in the large-cap category, EQT retains its crown as king of the Nordics for a fourth year in a row.

And no wonder: in a year when activ-ity was down across the board in Europe, the firm continued to power ahead on the deal-making front – including the largest

European deal of the year, the €1.8 billion acquisition of German bandage manufac-turer BSN Medical from Montagu Private Equity in June.

It also bought IT software vendor UC4 for €220 million from Carlyle Europe Tech-nology Partners, took a 70 percent stake in Danish retail chain Tiger and sold off the third and final part of medical company Gambro for SEK 26.5 billion (€3.1 billion, $4 billion) – taking the total transaction value of EQT’s exit to approximately SEK 50 billion (€5.8 billion, $7.6 billion).

A regional powerhouse – and now very much a European powerhouse too.

FirM oF tHe year in russia

1. VTB Capital

2. Baring Vostok Capital Partners3. Elbrus Capital

Baring Vostok Capital Partners may have closed Russia’s largest ever fund in 2012 – $1.5 billion, if you include the sidecar – but it wasn’t enough to prevent rival firm VTB Capital retaining the country crown for a second year in a row. Led by Tim Dem-chenko, the private equity arm of state bank VTB Group certainly enjoyed an impres-sive year: it made milestone investments in consumer retail (via a joint venture with Burger King and Burger Rus, which will give it the exclusive right to develop the franchise in the country). It also agreed a strategic tie-up with outdoor advertising company JC Decaux.

Burger King: VTB hungry for more



VTB also exited EPAM via an IPO on the New York Stock Exchange – the first US flotation of a company of Russian origin since 2004 – and sold White Square, an office centre in Moscow, for a return of more than 2x. Its peers clearly think this is a firm that is going places.

FirM oF tHe year in switzerlanD

1. Capvis equity Partners

2. Akina3. Equistone Partners Europe

After being forced off its throne by Nordic Capital last year, 2010 winner Capvis Equity Partners was back on top in Swit-zerland in 2012.

The Swiss buyout firm partially exited Koenig Verbindungstechnik, a Swiss fasten-ings and sealing technology products group, which it had jointly acquired in September 2008 with HgCapital.

But its most notable exit in its home country was definitely the sale of its 20 per-cent stake in Stadler Rail Group, a Swiss-headquartered supplier of parts and serv-ices to railway companies, to the company’s chief executive and largest shareholder Peter Spuhler. Since Capvis acquired its stake in 2006, the business has increased turnover from CHF 786 million (€631 million, $850 million) to CHF 2.4 billion, and boosted its staff headcount from around 2,000 to 4,500.

With a big domestic success story like this, it’s no wonder that Capvis won the

admiration of its European peers in this year’s voting.

FirM oF tHe year in tHe uk

1. HgCapital

2. Cinven3. Graphite Capital

A first victory in this category for HgCapital, following a good year for both deals and exits.

In the summer, Hg sold pharmaceutical company Mercury Pharma to fellow UK-firm Cinven, delivering a return multiple of more than 4.1x. It also exited SHL, a pro-vider of assessment testing products, which had seen revenues grow by more than 80 percent and EBITDA by over 200 percent (thanks to organic growth and acquisitions) during Hg’s period of ownership. That one yielded a return of more than 3.1x and a gross IRR of 26 percent.

The firm wrapped up the year with the acquisition of Valueworks, an e-platform provider for the UK housing and construc-tion market. The investment was the first deal from its new Mercury fund, a £300 million vehicle it has raised specifically to target lower mid-market TMT deals.

Founder and chairman Ian Armitage retired from Hg this year – but he’s clearly leaving the firm in rude health.

FunD oF FunDs oF tHe year in euroPe

1. BlackRock Private equity Partners

2. Access Capital Partners3. Danske Private Equity

As if it was not enough to be the world’s largest asset manager, BlackRock’s decided that 2012 would be the year when it makes a big splash in the fund of funds pond. The firm acquired Swiss Re Private Equity Part-ners, the private equity and infrastructure fund of funds arm of the Swiss insurance

group, last July, in a deal that doubles the assets managed by its private equity unit to $15 billion. That will make it one of the largest fund of funds manager in the world, as well as reinforce its presence in the infrastructure, European and Asian pri-vate equity markets. It’s also been a bumper fundraising year for BPEP; the firm gath-ered $1.6 billion in new commitments in 2012, including $700 million worth of re-ups from existing separate account clients and strategic partners. And it was also BPEP’s strongest year yet in terms of LP distributions, with $1.2 billion handed back to investors over the period.

PlaCeMent aGent oF tHe year in euroPe

1. Campbell Lutyens

2. MVision Private Equity Advisers3. UBS

Campbell Lutyens, in prior years better known for its work in the secondaries and infrastructure markets, is now motor-ing in private equity fund placement, too. Led by Rich-ard Allsopp (above), the primary fund place-ment team was responsible for the lightning quick fundraising of listed German buyout firm Deutsche Beteiligungs (DBAG). With the help of Campbell Lutyens, DBAG hit its hard cap of €700 million in just four months – beating the original €650 million target.

The firm successfully closed six private equity and infrastructure funds worth approximately €3 billion. And in what proved to be a record-breaking year for new business, the firm won more than €5 billion of primary fundraising mandates from new private equity and infrastructure clients.

Even the monarch was impressed. In May, Campbell Lutyens celebrated picking Capvis: sold Swiss rail company



up The Queen’s Award for Enterprise for its contribution to International Trade.

law FirM (FunD ForMation) oF tHe year in euroPe

1. SJ Berwin

2. Simpson Thacher & Bartlett3. Proskauer Rose

Europe’s largest fund team came out on top for the 12th year in a row, proving again that bigger can be better.

In another typically busy year, SJ Berwin advised on nine fund closings in Europe – more than any other law firm – with a total worth of almost $2.5 billion. Notable clients included Patron Capital, which raised €880 million for its fourth fund, and Quilvest Private Equity, whom the firm advised on two separate fund closes.

SJ Berwin does not appear to be dwell-ing on its success, either. 2012 saw the firm expand its jurisdictional reach by opening an office in Luxembourg, while it also hired David Huff, formerly 3i’s director of tax, as a private equity tax consultant.

With the funds team already advising on several large and mid-market fundrais-ings that are approaching a final close, it would be brave to bet against them retain-ing their title next year. Can anyone stop them making it lucky number 13?

law FirM (transaCtions) oF tHe year in euroPe

1. Clifford Chance

2. SJ Berwin3. Baker & McKenzie

There weren’t a lot of big European pri-vate equity deals in 2012, but when one did come along, it was a fairly safe bet that a Clifford Chance lawyer would be at the table.

For instance, the global firm acted for Clayton, Dubilier & Rice when it acquired UK retailer B&M Stores. It was also in Cin-ven’s corner for the £465 million ($582 million; €454 million) acquisition of spe-ciality pharmaceutical company Mercury Pharma from HgCapital, and its subsequent £367 million acquisition of family-owned Amdipharm.

The firm was busy on the sell-side too: it advised Equistone Partners Europe on the €1 billion sale of Global Blue, The Car-lyle Group on the £650 million sale of cash management business Talaris, and Montagu Private Equity on the blockbuster €1.8 bil-lion sale of BSN Medical to EQT.

All told, it’s no wonder Clifford Chance was voted as Europe’s top deal advisor – for the 12th year running.

larGe-CaP lenDer oF tHe year in euroPe

1. Deutsche Bank

2. JPMorgan3. Goldman Sachs

For a second year running, Deutsche Bank has been pivotal in helping firms get the big deals done.

Although it was a relatively quiet year for M&A at the larger end of the market, Deutsche managed to meet sponsors’ financing needs even as some of its rivals retrenched. UK headquartered buyout firm Permira used Deutsche for its $1.6

billion acquisition of Ancestry. The bank also backed EQT when it bought BSN Medi-cal, the German bandages maker, in a deal worth €1.8 billion.

Deutsche also had a hand in floating Dutch cable company Ziggo for Warburg Pincus and Cinven while also assisting in the bookrunning for BC Partners’ new PIK notes for Swedish cable television group Com Hem, raising €250 million.

In fact, with more than €4.5 billion of lev-eraged loan issuance, Deutsche was Europe’s top bookrunner – and thus a worthy winner of our large-cap lender category.

MiD-CaP lenDer oF tHe year in euroPe

1. Partners Group

2. HSBC3. Intermediate Capital Group

With some traditional providers choosing to reduce their lending activity in 2012, particularly in this segment of the market, Partners Group seized the opportunity to pounce. The firm’s private debt arm, headed up by René Biner and Juri Jenkner, raised its first-ever dedicated investment vehicle – a €375 million fund that will provide debt financing to mid-market companies.

By formalising and strengthening its lending activities, last year’s European Mezzanine firm of the year succeeded in dislodging last year’s winner HSBC from the top spot.

Its timing seems to be impeccable. Capi-tal constraints are forcing some of the banks to withdraw from the market (at least to some extent) – but the demand for fresh debt remains strong, as GPs look to refi-nance their existing investments and put their dry powder to work.

Partners is not the only firm to recog-nise this trend. But this result shows that – not for the first time – it has managed to stand out from the crowd. n

B&M: Clifford Chance helped CD&R bag some bargains



larGe-CaP FirM oF tHe year in nortH aMeriCa

1. The Carlyle Group

2. Bain Capital3. Kohlberg Kravis Roberts

This year’s king of the large-cap firms in North America is The Carlyle Group, a group that has – perhaps more than any other mega-firm – expanded its product offerings well beyond traditional private equity into strategies like real estate, credit and natural resources.

Carlyle’s story highlights the relatively quick evolution of the largest section of the industry. Most mega-firms have moved from leveraged buyouts into many other areas, and it’s a trend that will continue as the biggest shops continue to grow.

Still, the firm’s evolution has not impaired its ability to raise capital or make deals. Car-lyle raised about $9.4 billion during the first three quarters of 2012 alone – an impressive effort by its fundraising team. The firm also kept busy on the mega-deal front by acquir-ing DuPont Performance Coatings for $5.15 billion and Getty Images for $3.3 billion.

Carlyle also found exits, including the sale of Dunkin’ Brands, which earned the firm a reported 3x return.

MiD-Market FirM oF tHe year in nortH aMeriCa

1. The Riverside Company

2. Vista Equity Partners

3. Thoma Bravo

Many firms in today’s volatile financial envi-ronment are struggling to make or exit deals. The Riverside Company doesn’t seem to have that problem. Last year it made 36 new investments – includ-ing its 300th global transaction. It also recorded no fewer than 14 exits, with highlights including the sale of a stake in Wildlife International, which netted the firm a cash-on-cash return of 11.9x, and specialty manufacturer DuBois Chemicals, which generated a 5x return.

Its most recent fund, Capital Apprecia-tion Fund V, was generating a combined net internal rate of return of 33 percent and a 3x cash-on-cash multiple.

Indeed, for Riverside, last year was not all that different from previous years: regardless of the economic environment, or what other investors are doing, the firm continually follows its own path, finding and doing deals – both in North America and beyond.

liMiteD Partner oF tHe year in nortH aMeriCa

1. State of Wisconsin Investment Board

2. Florida State Board of Administration

3. Ewing Marion Kauffman Foundation

Being the year’s top investor means more than just committing the most capital to private equity managers (though that

doesn’t hurt). It also means helping set a standard in the industry that other limited partners end up following.

Wisconsin made a bold statement in 2012 when it publicly revealed the

rationale for selling a big chunk of its private equity portfolio. The system, one of the biggest and oldest investors in the asset class, had decided to back away

from mega-funds. Now that some of the largest funds had gone

public, they were no longer properly aligned with LPs, according to public docu-ments from the retirement system.

Wisconsin was not blazing a new path; other LPs have made the same choice in recent months and years. But its bold public pronouncement helped define a trend that had been gradually forming in the industry, and may well continue long into the future.

nortH aMeriCan eXit oF tHe year

1. north American Breweries (KPS Capital Partners)

2. Suddenlink (Goldman Sachs, Oaktree Capital Management, Quadrangle Group)

3. Sunquest Information Systems (Vista Equity Partners, Huntsman Gay Global Capital)

This beer deal was legendary. The numbers don’t lie: KPS Capital

Partners reaped a 9x return on its sale of North American Breweries, making it one of the most successful exits of the year.

But back when the firm launched its brewery effort in 2009, the chances of that happening looked remote. KPS took a collection of moribund brands, includ-ing the Genesee label that had been around for more than 150 years, and bolted them together into one business. Rubenstein: answering to LPs and shareholders

tHe Pei awarDs 2012: aMeriCas


With North American Breweries, the firm built a company by combining a number of cast-off brands and revitalis-ing them, as well as introducing some new products into the mix. The resulting com-pany has several popular brands of beer, including Pyramid, Magic Hat and new products like Labatt’s lime-flavoured Blue Light Lime.

It’s not an easy way to live – picking out the value that no one else can find – but KPS clearly has a knack for it.

nortH aMeriCan Deal oF tHe year

1. el Paso (Apollo Global Management, Korean national Oil Corp., Riverstone Holdings)

2. TCW (The Carlyle Group)3. HIS (BC Partners, The Carlyle

Group)

Apollo Global Management, the Korean National Oil Corporation and Riverstone Holdings aimed high with their acquisition of El Paso’s oil and gas exploration divi-sion last year, shelling out $7.15 billion (in a deal that valued the whole company at $38 billion).

Of course, the deal was not without its complications; few $7 billion plus transac-tions are. El Paso investors sought to halt the acquisition – an effort that was blocked by a Delaware court judge – and there were some conflict of interest concerns sur-rounding Goldman Sachs’ involvement as an advisor to El Paso.

However, none of these snags were suf-ficient to stymie the efforts of the Apollo-led group. The collective sealed the deal in May, and since then the newly-dubbed EP Energy has thrived. Oil volumes are up by 60 percent, and new gas rigs are planned in two of its properties, according to a third quarter invest-ment report. Sometimes it pays to think big.

seConDaries Deal oF tHe year in nortH aMeriCa

1. Willis Stein restructuring (Landmark Partners, Vision Capital)

2. Ridgemont Equity Partners spin-out (Goldman Sachs, AlpInvest and Landmark Partners)

3. OMERS Portfolio (AXA PE)

Every deal is different, but the Willis Stein restructuring – arranged by secondaries

players Landmark Partners and Vision Capital (with some help from PineBridge Investments) – was particularly creative.

Willis Stein’s $1.8 billion 2001 vintage had struggled to close out its three remain-ing investments, much to the chagrin of some of its LPs. In order to liberate those assets, Landmark and Vision contrib-uted $220 million to acquire existing LP interests and create a new vehicle for the remaining companies. LPs who chose to cash out on their investments received 90 cents on the dollar for their stakes, while those who stuck around rolled their com-mitment over into the new vehicle.

With LP concerns over so-called zombie funds on the rise, Landmark and Vision’s solu-tion to Willis Stein’s end-of-life woes serves as a timely reminder of how secondary strat-egies can provide an effective way out.

Creativity and effectiveness – definitely worth an award, in our book.

seConDaries FirM oF tHe year in nortH aMeriCa

1. Landmark Partners

2. AXA Private Equity3. Lexington Partners

Landmark Partners seems to hold a per-petual spot at the top of the North Ameri-can secondaries chart, winning this title year after year.

The firm is known for its ability to craft creative solutions to the needs of buyers and sellers in the market. Last year was no exception: the firm teamed with Vision Capital on the restructuring of a long-lived tail-end fund in which limited partners were desperate for liquidity options.

The deal – which involved Willis Stein’s third fund – was widely viewed as a model for how the secondary market could help LPs deal with funds in their portfolio that had lived long past their contractual lives.

Landmark also took part in a deal to

American beer: revitalised by KPS



help Ridgemont Equity Partners achieve financial separation from its parent, Bank of America. Spin-outs from larger organisa-tions were another trend in the market that could become an area of great opportunity for secondary players. And as usual, Land-mark is leading the way.

DistresseD investMent FirM oF tHe year in nortH aMeriCa

1. Oaktree Capital Management

2. Apollo Global Management3. Centerbridge Partners

Attracting some of the biggest state pen-sion systems in the US into a fund is no mean feat, especially in today’s ultra-tight fundraising environment.

So when a slew of the biggest names in the state pension world commit, it’s pretty clear the firm running the vehicle is doing something right. Such is the case with Oaktree Capital Management, a three-time champion in distressed investments, both in Europe and North America.

Last year, the firm collected $5 billion on a $4.9 billion target for its latest distressed fund, Oaktree Capital Management Oppor-tunities Fund IX. Oaktree LPs include the

likes of the Washington State Investment Board, the Massachusetts Pension Reserves Investment Management Board, the Los Angeles County Employees Retirement Association and the Tennessee Consolidated Retirement System.

The Howard Marks-led firm just seems to inspire confidence in its LPs – especially with its strong past performance – and today’s volatile financial environment will likely keep the Los Angeles-based group busy for a long while yet.

sPeCial situations/turnarounD FirM oF tHe year in nortH aMeriCa

1. Ares Management

2. Sun Capital Partners3. KPS Capital Partners

It all comes down to performance. If you can’t generate returns for your LPs, don’t expect your LPs to fork out commitments to your next fund. Neither was a problem for Ares Management in 2012.

Ares closed its fourth flagship fund on $4.7 billion in August, well north of the $4 billion target the firm had set when it began pitching Ares Corporate Opportunities Fund IV to investors in early 2012.

Of course, the speedy fundraise benefit-ted from Ares’ performance on Fund III, a $3.7 billion 2008 vintage that was generating a 25.4 percent net internal rate of return through June, according to California Public Employees’ Retirement System documents.

In addition to knocking out a successful fundraise, Ares beat out Centerbridge Part-ners to acquire a majority stake in US grocery retailer Smart & Final from Apollo Global Management for $975 million. Ares also ven-tured south of the border for its investment in oilfield service provider Oro Negro.

FirM oF tHe year in CanaDa

1. Canada Pension Plan Investment Board

2. Onex Corporation3. Teachers’ Private

Capital

Keeping up with the Canada Pension Plan Investment Board is not easy. After naming Mark Wiseman (right) as its new president and chief executive officer and hiring Goldman Sachs veteran Mark Machin as president of CBBIP Asia, the C$172.6 billion manager went on an investing spree.

CPPIB bought a majority stake in US cable company Suddenlink for a whop-ping $6.6 billion alongside BC Partners, and acquired the Air Distribution division of Tomkins for $1.1 billion. The pension plan also shook things up in the secondar-ies market, committing $654 million as the lead secondary investor in the restructuring of Behrman Capital’s Fund III.

While CPPIB continued to focus more on direct private equity deals last year – including $400 million into oil and gas assets in Calgary and Alberta – the pension plan was also active on the private debt side,


Smart & Final: now the property of Ares


financing $400 million of a $1 billion high-yield loan to Formula One Group.

FirM oF tHe year in latin aMeriCa

1. Rio Bravo

2. The Carlyle Group3. BTG Pactual

Closing any fund these days is an accom-plishment. Changing the way fundraising is conducted in one of the hottest emerging markets? Consider that spectacular.

In May, Brazil-based Rio Bravo closed its clean energy Energia I fund on R$463 mil-lion (€185.8 million; $229.6 million), a total that included commitments from 20 Bra-zilian pension systems among its investors. Brazilian pensions are notoriously demand-ing limited partners, and have historically insisted on holding a seat on their fund managers’ investment committees. That puts them at odds with more traditional LPs, particularly international investors, who are concerned about conflicts of interest.

Rio Bravo found a way around Brazilian pensions’ unusual demands, negotiating a concession on Energia I that gave the pen-sions a seat on the fund’s advisory commit-tee. That concession – the first of its kind – was enough reassurance for international investors, who entered the fund following a 2010 first close.

A revolution in Brazilian fundraising? Not bad for R$463 million.

FunD oF FunDs oF tHe year in nortH aMeriCa

1. HarbourVest Partners

2. Hamilton Lane3. Portfolio Advisors

A well-executed plan is worth repeating. In 2011, HarbourVest turned heads

with its $800 million acquisition of listed

private equity firm Absolute Private Equity’s portfolio, highlighting the trend for consolidation in the listed private equity world. In 2012, it made another acquisition in this space – only this time, it went bigger.

In July, the Boston-based fund of funds and secondaries specialist acquired Conversus Capital’s portfolio of private equity fund interests and co-investments for $1.4 billion. The listed portfolio includes interests in more than 200 funds, making it the largest of its kind. Investors seem to approve: HarbourVest’s own listed vehicle narrowed its discount to NAV substantially last year.

As if that wasn’t enough, the firm also established a Chinese presence with its appointment of Sally Shan (above), who will head the firm’s new office in Beijing. Shan’s extensive private equity pedigree includes stints at JP Morgan, Lehman Brothers and Asia Strategic Investment Corp.

No shortage of ambition, then...

PlaCeMent aGent oF tHe year in nortH aMeriCa

1. eaton Partners

2. Park Hill Group3. Credit Suisse

Fundraising for private equity funds hasn’t gotten any easier, but having placement agent Eaton Partners raise your fund is certainly an advantage. The Connecticut-based firm helped several general partners exceed their targets and reach final closes without turning fundraising periods into multi-year affairs.

Eaton was particularly active with energy funds (very popular at the moment). It helped take Red Kite Group’s mining fund RK Mine Finance Fund II to $1.15 billion in just 10 months, well above the firm’s

$750 million target, and Paral-lel Resource Partners’ Energy Recapitalization and Restruc-turing Fund to $520 million – smashing its $300 million

target.Other highlights included

Summit Partners’ debut credit fund, which collected $520 million on

a $300 million target, and Intermediate Capital Group’s Europe Fund V, which hit its GP-imposed €2.5 billion hard-cap.

Eaton also claimed a piece of the sepa-rate account market, helping Asia Alterna-tives Capital Partners III raise $908 million on an $800 million target, plus $600 million of separate accounts.

MiD-CaP lenDer oF tHe year in nortH aMeriCa

1. Ge Capital

2. Golub Capital3. Fifth Street Capital

At a time when many companies in the mid-market struggled to secure capital from the big banks, as they grapple with balance sheet problems, GE Capital has continued to prove itself to be the friend of the mid-market deal.

The group’s Sponsor Finance business completed 275 transactions for $17.8 bil-lion in volume, while its Senior Secured Loan Programme provided $3.4 billion to mid-market borrowers and private equity firms. SSLP, which is jointly managed by an affiliate of GE Capital and Ares Capital Corporation, led a $367 million loan for Kelso & Company’s acquisition of Augusta Sportswear and a $200 million loan to sup-port the refinancing of consumer sewing machine business SVP Worldwide by Kohl-berg & Company.

Bigger-ticket transactions included a $405 million senior facility for Leonard Green & Partners’ acquisition of Tank



Holdings and a $555 million loan for pack-aging solutions business TricorBraun, a CHS Capital portfolio company.

larGe-CaP lenDer oF tHe year in nortH aMeriCa

1. JPMorgan

2. Goldman Sachs3. Royal Bank of Canada

Providing $32 billion in loans across 131 transactions in one year will get you noticed.

JPMorgan has long been a preferred lender to the private equity community (it won last year too) and specialises in many of the headline-grabbing large-cap trans-actions pursued by giants like The Carlyle Group, Kohlberg Kravis Roberts and The Blackstone Group.

This year, JPMorgan provided work-ing capital through an asset-backed loan

to Carlyle in that firm’s effort to save a Philadelphia refinery. The high-profile public-private partnership – which took place in the midst of a contentious debate about private equity’s role in the economy – is thought to have saved 850 jobs at the site, the oldest operating refinery on the east coast.

The bank also arranged debt financ-ing on Summit Partners and Golden Gate Partners’ merger of Infor and Lawson, a technology deal with a $1 billion-plus equity ticket.

A tough year to top in 2013 – but never underestimate the crew at 270 Park Avenue.

law FirM oF tHe year (FunD ForMation) in nortH aMeriCa

1. Debevoise & Plimpton

2. Simpson Thacher & Bartlett3. Latham & Watkins

During a period when fundraising condi-tions are tricky, to say the least, GPs place high value on having the industry’s top legal advisors sitting at their end of the table during negotiations with LPs. That much was made clear as Debevoise & Plimpton continued its streak as the top choice for GPs raising capital.

Led in New York by partners Michael Harrell and David Schwartz, the fund formation practice helped GPs secure an impressive $22 billion in commitments for funds that held a final close in 2012. Factor in money raised last year for funds yet to announce a final close, and that number jumps to $35 billion.

Notable briefs last year included help-ing Baring Vostok Capital Partners secure $1.5 billion in total firepower for its Fund V; and Capital International corral an even higher $3 billion for its Private Equity Fund VI. No wonder it’s still the leader of the pack.

law FirM oF tHe year (transaCtions) in tHe aMeriCas

1. Kirkland & ellis

2. Ropes & Gray3. Debevoise & Plimpton

Kirkland & Ellis started 2012 with a bang, winning more private equity deal work than any other law firm in the first quarter. And activity never slowed – allowing Kirkland to depose rival firm Simpson Thacher & Bar-tlett as the top-rated firm for transactions.

Stateside, its team of M&A lawyers could boast of advising a handful of GPs on $1 billion-plus deals, at a time when most law firms were happy to settle for mid-market transactions.

Mega deals in which Kirkland took part included Permira’s $1.6 billion buyout of genealogy website Ancestry.com; Bain Capi-tal’s purchase of tools manufacturer Apex Tool Group, also for $1.6 billion; and Thoma Bravo’s $1.1 billion all-cash acquisition of software company Deltek.

With some industry observers predict-ing a return of the mega buyout in 2013 (especially in light of the Dell deal), Kirk-land should be in pole position to retain its newly-acquired crown in the coming year. nJPMorgan: large-cap leviathan

Ancestry: Kirkland advised on the $1.6bn deal


89annual review 2012 private equity international

larGe-CaP FirM oF tHe year in asia

1. Bain Capital

2. Kohlberg Kravis Roberts3. CITIC Private Equity Funds

Management

Challenging US election rhetoric and strong competition from KKR and CITIC PE didn’t faze Bain Capital. The firm (which won Firm of the Year in Japan last year) continued to complete large buyouts in Asia’s toughest markets. It was not only the $1.1 billion Jupiter Shop Channel buyout in Japan that earned Bain accolades, but the firm’s $1 billion purchase of business process outsourcing firm Genpact in India. There were also three control transactions in China, where such deals are rare.

“We have a flexible approach to invest-ments in Asia and are able to pursue the best deals irrespective of scale and geography,” says Jim Hildebrandt, managing director of Bain Capital. “While we have completed many mid-market investments, we have also originated and closed some of the largest deals in the region.”

Indeed, the firm seems to be sailing on through the storm: Bain closed a $2.3 bil-lion Asia fund during a year when annual Asia fundraising totals were down 30 per-cent.

MiD-Market FirM oF tHe year in asia

1. navis Capital Partners

2. Warburg Pincus3. Olympus Capital

In a tough year for deals and exits in the region, Navis was very much an exception to the general trend. The most eye-catching figures came from two 10x exits, one in Hong Kong and one in Indonesia. But all told, the team executed a total of six deals and six exits across Asia (excluding add-on acquisitions) in diverse markets including Malaysia, Vietnam and India. “It’s the first time ever our new deals equaled exits and we plan to maintain that going forward,” says co-founder Nicholas Bloy (below).

Navis (which also won the Southeast Asia Firm of the Year in 2012 and 2011) is happy to remain a mid-market firm that does almost exclusively control deals. That means, among other things, using far less leverage than the larger firms, Bloy says. The team would rather pursue an aggressive growth strat-egy backed by a strong balance sheet, “instead of acquisition finance, which inhibits a company from growing because it has to pay back debt”.

liMiteD Partner oF tHe year in asia

1. Government of Singapore Investment Corporation

2. Temasek3. Ontario Teachers’ Pension Plan

The Government of Singapore Investment Corporation upstaged local rival Temasek, courtesy of several large transactions and investments. GIC was largely cautious, stockpiling cash during the year as it awaited better investing conditions. Nonetheless, the $247 billion Singaporean sovereign wealth fund jumped in on two acquisitions with Bain Capital in India, including the $1 billion secondary buyout of General Atlantic- and Oakhill Capital-owned Genpact. GIC also joined a group of private equity investors in a $1 billion acquisition of Korea’s Kyobo Life Insurance, further demonstrating to

Asian GPs that it can carry out co-investments across the region.

Also in 2012 (during which it increased its allocation to alternative assets by 1 per-cent), GIC, along with KIA and a third unnamed fund

acquired a 10 percent stake in CVC Capital Partners; the hope

being that it will bring preferential access to CVC deals as well as a share of management fees and carried interest.

Singapore: GIC’s base for a shopping spree

Shopping: Bain now big in Japan

tHe Pei awarDs 2012: asia


eXit oF tHe year in asia

1. unison Capital

2. Navis Capital Partners3. Steamboat Ventures

A lack of deals and low returns in Japan have disappointed investors. But Unison Capi-tal’s 2012 exit of Akindo Sushiro, a sushi restaurant chain that it sold to UK-based Permira for $1 billion, may give some pause for thought. Unison’s sale yielded an 8x exit multiple, says Tatsuo Kawasaki, Unison co-founder and partner.

Operational work played a key role. Over a five-year holding period, EBITDA increased from 4 billion to 10 billion yen (€84 million; $113 million), purely from organic growth, he adds. “The management pushed forth with growth and profitability initiatives and these came to fruition in light of the fact that the Japanese economy at best is going sideways,” Kawasaki says.

In the last 13 months, Unison also made five acquisitions, four in Japan and one in Korea, which came from Fund III (vintage 2008). In 2013, the firm intends to raise a new Japan-focused fund, suggesting that the country, at least for Unison, is living up to expectations.

Deal oF tHe year in asia

1. Alibaba’s buyback of Yahoo! Shares (China Investment Corporation, Boyu Capital, CITIC Capital, China Development Bank)

2. China Cinda Asset Management (UBS, Standard Chartered, CITIC Capital)

3. Hong Kong Broadband Network (CVC Asia Pacific)

Alibaba Group’s $7.6 billion buyback of about half of Yahoo!’s stake, driven by a China Investment Corporation-led group, was China’s largest private financing ever for a private sector company. The group included Boyu Capital, CITIC Capital and CBD Capital, together providing $4.6 bil-lion (including convertible equity).

The complex deal had five parts involv-ing M&A and financing, with private equity playing a key role in the final phase. “Alto-gether we were executing five deals and all had to be coordinated with different parties with different interests in different juris-dictions,” says Joseph Tsai, CFO of Alibaba.

Talks with the Chinese investors began in early 2012, even before a deal with Yahoo! had been sealed. “We couldn’t tell the PE guys we needed the capital until we had a deal locked up, so it was a chicken-and-egg problem.”

This year founder Jack Ma will step down as chief executive officer, leading to rumours that Alibaba – which is valued at $40 billion – will reward investors soon by launching an IPO.

FirM oF tHe year in australasia

1. Pacific equity Partners

2. CHAMP Ventures3. CHAMP Private Equity

It’s been a good year for Pacific Equity Partners. Although the number and value of Australia deals fell significantly (along with most of Asia), PEP reviewed close to 100 transactions, price indicated on 25 and went all the way on five, says manag-ing partner and co-founder Tim Sims. Two weren’t sold and the other three the firm

acquired through LBOs for total dollar outlay in excess of A$1 billion. One of those was the A$720 million take-private of cleaning services giant Spotless Group, which had rejected previous offers from the Blackstone Group and CVC Asia Pacific, as well as PEP.

This year promises more big events. PEP expects to realise nearly A$2 billion in the next 18 months and has high hopes for strong returns from several Fund IV portfolio companies. That ideally paves the way for the expected launch of the next fund: an ambitious A$2 billion core fund plus an A$1 billion sidecar for discretionary co-investment.

FirM oF tHe year in CHina

1. The Carlyle Group

2. CDH Investments3. FountainVest Partners

Sushi: healthy returns for Unison Sims: Deal finder

HKEx: produced a 6x return for Carlyle



Think a foreign firm can no longer win in China? For the first time since 2006, a global firm unseated the local powerhouses. The Carlyle Group’s work in China speaks for itself: in addition to eight domestic investments totaling more than $700 mil-lion, Carlyle was the lead investor on the landmark $3.7 billion Focus Media take-private. In addition, Carlyle realised over $1.5 billion in proceeds, including a mul-tiple-stage exit of China Pacific Insurance Group via the Hong Kong Stock Exchange, which according to reports yielded a return of almost 6x.

“Having established our presence in China for more than 15 years, we have built a large local team with strong local networks and a highly respected brand name,” explains Xiang-Dong Yang, Carlyle managing director. In that time, Carlyle has invested in everything from real estate to healthcare from five different funds – three USD and two RMB – and is targeting $3.5 billion for another Asia buyout fund.

FirM oF tHe year in JaPan

1. J-Star

2. Bain Capital3. The Longreach Group

The big story in Japan in 2012 was the small-cap market, with 77 percent of deals under $125 million, accord-ing to Brightrust PE Japan figures. J-Star snatched the plaudits from industry giant Bain Capital as the leading firm in this arena – and with good reason. The firm has had two impressive exits in a depressed market (a source close to the firm described the exits as 8x and 3.4x), both to strategic buyers. The seven-person firm also bought a controlling stake in Three Arrows, a small pet products supplier, for under $125 million.

Gregory Hara, president and chief

executive of J-Star (below), likes to call the firm’s investments “solution capital”, because they focus on issues within the company that private equity can fix. He

believes J-Star’s reputation in the insular small-cap market has

made all the difference. The firm also believes it’s well-positioned to help Japa-nese companies expand offshore: a January 2013

exit involved a Japan-China business.

FirM oF tHe year in korea

1. MBK Partners

2. Hahn & Co.3. H&Q Asia Pacific

MBK Partners took the Korea award from last year’s winner Morgan Stanley Private

Equity Asia, mainly on the basis of an unu-sual deal that attracted industry attention. The firm’s $1.54 billion investment in air and water purification business Woongjin Coway brought management control for just a 31 percent stake. It was also Korea’s largest deal where the family-run con-glomerates (or chaebols) lost the bidding, according to MBK’s head of Korea James Yoon – possibly signalling a change in the market dynamic.

The firm also exited Korea’s largest car rental, KT Rental, for a 1.9x return and 31 percent IRR, and held a $1.5 billion first close on their third fund just months after launching.

MBK’s choice to focus on the domestic consumption story, rather than Korea as an export base, has given the firm a distinct advantage, according to Yoon. “That helped us maintain our portfolio, even in times of greater market uncertainty,” he explains.

Woongjin Coway: MBK’s watercooler moment in Korea



FirM oF tHe year in inDia

1. everstone Capital Partners

2. Warburg Pincus3. ChrysCapital

For the second year running, Everstone Capital Partners took the award for India. Ploughing through its second India-focused fund, Everstone made a number of invest-ments last year when other firms sat on the sidelines. Led by co-founders Sameer Sain and Atul Kapur, Everstone showed it could deploy capital in India, a market where deal flow has plunged in line with India’s macro indicators. The $580 million fund was 30 percent deployed as of October 2012 across six investments, including a $38 million acquisition of education firm S Chand Group and undisclosed investments in R&R Salons Private and Transpole Logistics.

And the firm’s ambitions may be grow-ing. According to reports, Everstone was one bidder for the India operations of travel service provider Thomas Cook.

Also last year, Everstone strengthened its senior management: in October, it hired Rajesh Jaggi as head of real estate, allowing the existing senior partners to focus on the firm’s private equity business.

FirM oF tHe year in soutHeast asia

1. navis Capital Partners

2. Saratoga Capital3. Northstar Pacific Partners

For the third year in a row, Navis Capital Partners takes home the Southeast Asia award. No surprise there; the mid-market firm has been a trailblazer in the region ever since its 1998 founding. Navis’ highlight of 2012 was exits, according to managing partner Nicholas Bloy. The firm had four in

Southeast Asia – one 4x, another 2.5x and two 10x exits, which were Efficient English Services in Indonesia and Hong Kong-based TrimCo. Navis found “easy” exits, Bloy adds, because it was the controlling shareholder in each investment – something strategic buyers will increasingly look for in South-east Asia, he believes.

Going forward, the challenge will be handling the rising complexity of cross-border growth within the region, Bloy said. The ASEAN single market is expected to come into force in 2015, and has drawn the attention of global and pan-regional funds. But Bloy believes Navis’ long history and track record in the region gives his firm a veteran’s advantage.

Frontier Market FirM oF tHe year

1. Actis

2. Mekong Capital3. Silk Road Management

“Our heritage is in the emerging or frontier markets,” says Meng Ann Lim, head of China and Southeast Asia for Actis – pointing out that his firm first went into China and India when they were considered frontier mar-kets. Sri Lankan healthcare:a new frontier for Actis

Indian education: an Everstone focus



Last year, the UK-based firm continued that tradition by investing in the far-flung, underdeveloped market of Sri Lanka, a place where other investors tend to be more circumspect. In October, Actis invested $32 million in the Asiri Group, a 604-bed pri-vate hospital group in Colombo.

Actis also hired David Koh as director in Singapore and Ivy Santoso in Indonesia – groundwork for more emerging market deals, Lim says. And in the ESG area, the firm developed an “energy impact model” aimed at identifying non-financial value drivers within its energy portfolio.

A big milestone for Actis was full inde-pendence. In April, the firm bought the remaining 40 percent stake from the UK government, from which it had spun out in 2004.

FunD oF FunDs oF tHe year in asia

1. Squadron Capital

2. HarbourVest Partners3. Pantheon

Squadron Capital held on to its crown again, despite active years for peers HarbourVest and Pantheon. During 2012, the firm was acquired by US-based fund of funds FLAG Capital, which brings the pair’s total assets under management to $6 billion. FLAG will help Squadron tighten relationships with the North American and European investor base, says David Pierce, Squadron’s chief executive.

Competing in a populous funds of funds industry in Asia, in a tough year for deals, Squadron stood out by investing in China, India, Southeast Asia, Australia and Korea, says Pierce. “There are some very good companies that are now available for invest-ment at more attractive valuations than any time in the recent past.”

Squadron remains positive about the region during 2013 (despite Asia-wide

drops in deal flow and fundraising) and is now raising its third vehicle targeting $400 million, according to PEI’s data division.

DistresseD/sPeCial situations FirM oF tHe year in asia

1. Apollo Global Management

2. Oaktree Capital3. PAG

Being the senior lender in what became one of the biggest write-offs in private equity history was bound to turn some heads. Lucky for Apollo, its decision to provide the debt for CVC Capital Partners’ A$5.6 billion (€4.3 billion; $5.9 billion) acquisi-tion of Australian TV network Nine Enter-tainment paid off. In a debt-for-equity swap, Apollo and fellow lender Oaktree Capital led a group of investors to take control of the struggling media business after CVC accepted an A$1.9 billion loss.

But what likely put Apollo ahead of Oak-tree in the awards voting was its latest India-focused special situations joint venture with ICICI Venture, the private equity arm of India’s second largest bank. The firms formed AION, hoping to finance good companies in India struggling to refi-nance debt. The fund had a first close in mid-2012 and is expected to reach a final close on $500 million.

PlaCeMent aGent oF tHe year in asia

1. uBS

2. Campbell Lutyens3. MVision Private Equity Advisers

LPs are scrutinising each commitment like never before, so closing two funds targeting China and one for Indonesia is no mean feat. UBS did just that, helping complete fundraising for Saratoga Capital’s Fund III

($600 million), GGV Capital’s Fund IV ($509 million) and FountainVest Partners’ Fund II ($1.35 billion).

Each of the three was oversubscribed and closed on their respective hard-caps. “We were very glad to close three funds on their hard-caps in an environment that was not that conducive to fundraising,” says Javad Movsoumov, executive director at UBS.

UBS had previously worked with Foun-tainVest in 2008 on Fund I, while Saratoga Asia and GGV are new clients of the firm (and Saratoga’s first use of a placement agent). UBS now has six Asia-based profes-sionals in its private funds group and is cur-rently working on two other Asia-focused private equity funds, which are expected to close in 2013.

law FirM oF tHe year in asia (FunD ForMation)

1. O’Melveny & Myers

2. Debevoise & Plimpton3. Ropes & Gray

For the third year, O’Melveny & Myers

took the Fund Formation award in Asia. Part of the reason, says

partner Dean Col-lins (left) is the firm’s

track record. OMM has seven offices in Asia and was

one of the earliest global firms involved in Asia fund formation, advising on their first in 2004. In 2012, the firm advised on 25 diverse funds across the region, includ-ing the first fund for Asia Growth Capital Advisors (a spinout from Credit Suisse); the debut fund from Indonesia’s KV Asia Capital; Sino-Century’s first US dollar vehi-cle and the $750 million Rothschild Invest-ment Trust and Creat Group joint venture



private equity fund. OMM also worked with large Asian LPs including the Government of Singapore Investment Corporation and China Investment Corporation.

Collins believes private equity clients are attracted to the way OMM’s team inte-grates with clients, adding that his firm sees itself as an extension of a GP’s inves-tor relations rather than an outsourced service provider.

law FirM (transaCtions) oF tHe year in asia

1. Clifford Chance

2. Ropes & Gray3. Freshfields

Bruckhaus Deringer

After two years, Clifford Chance has taken the Law Firm transactions title back from rival Debevoise & Plimpton. The firm advised on more than 20 com-plex transactions in Asia last year. Some of the highlights include CVC Asia Pacific’s $105 million acquisition of Venturepharma Group (China); CVC Capital Partners’ $641 million acquisition of Hong Kong Broadband Network, a rare LBO of a Hong Kong-listed company; and Permira’s $1 bil-lion leveraged buyout of Japan’s Akindo Sushiro in a secondary deal from Unison Capital.

The firm also promoted veteran Mark Shipman (above) to head of corporate prac-tice in Asia-Pacific. Shipman has been with the firm in Asia since 1997, when private equity was just beginning in the region.

Clifford Chance is also looking ahead. It was one of the first law firms to open an office in Seoul this year (after local regula-tions let in foreign law firms). It now has nine offices across Asia-Pacific.

lenDer oF tHe year in asia

1. HSBC

2. Standard Chartered Bank3. Mizuho Bank

HSBC was a key lender on several big Asian deals in 2012, including Alibaba’s private equity-backed $7.6 billion buyback of shares from Yahoo! and Pacific Equity Partners’ $753 million buyout of Spotless Group. Altogether, the bank underwrote $800 million of debt across five deals, according to Lyndon Hsu, head of leveraged and acquisition financing for Asia Pacific. This is quite a step-up year-on-year, he added – in 2011, HSBC had only $400 million in underwrites.

The activity comes during a time when many European banks are pull-ing back from debt lending in Asia in order to shore up their balance sheets at home. HSBC was origi-nally a Hong Kong bank until the

80s and since then has built its brand via offices in most Asian countries, which

serve to “connect the dots” for private equity, Hsu said. “The consolidation of [acquisition finance] this year has really given a sense of renaissance to the bank.”

seConDaries FirM oF tHe year in asia

1. Partners Group

2. Axiom Asia3. Lexington Partners

Rounding off the year with an impressive €2 billion final close on its latest global sec-ondaries vehicle, Partners Group clinched the top spot for secondaries firm in Asia. The firm’s increased commitment to Asia Pacific will be reflected in a larger allocation of capital and resources to the region via the new fund. Another highlight of the year was Partners’ contrarian upbeat view on India: it

hired ex-JPMorgan executive Cyrus Driver to head its India operations, even as the market continues to loses its appeal to investors.

With many funds coming to the end of life in China and India and exit markets clogged, will this be the year when the regional sec-ondaries market really takes off? According to Adam Howarth (below), head of Asian secondaries at Partners, the market is at an “inflection point” in Asia. “Many investors are looking at their portfolios and deciding what to do in terms of portfolio management.”

seConDaries Deal oF tHe year in asia

1. GIC portfolio (CS Strategic Partners)

2. Mizuho portfolio (AXA Private Equity)

3. Thai solar portfolio (Equis Funds Group)

Appearing again on this year’s list of winners is the Government of Singapore Investment Corporation, the sovereign wealth fund, this time for selling a chunk of its massive private equity portfolio in a sales process run by UBS. GIC sold $750 million worth of its portfolio during the course of the year, but CS Strategic Partners took the largest piece – close to $300 million worth of private equity assets.

The sale represented the first time GIC has pursued a major, inter-

mediated sale of its private equity assets, PEI reported. The move closely followed a change in management at the institution. In June 2011,

GIC promoted Tay Lim Hock, deputy president of GIC Special

Investments, the institution’s private equity arm, to president. Since the end of the year there have been more top-level changes: Kok Song Ng, GIC’s first group chief investment officer, retired, making way for his deputy Chow Kiat Lim to take over his post. n


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