2007 European Private Equity Activity Survey PEREP_Analytics™

2007 European Private Equity Activity Survey

PEREP_Analytics™

Methodology

Data collected via survey questionnaires and reliable public sources (coverage rate by number of players: 60%)

Europe: for deals, it is defined either by the location of PE firm or of target as referenced in the source; for fundraising it covers funds managed from Europe or 100% targeted to Europe;

Fundraising: only formal closings included with committed amount;

Investments: only equity value captured, debt also IF provided by PE funds (bank leverage excluded);

Divestments: measured at amount at cost divested (not proceeds);

Sources: PEREP_Analytics for 2007 figures,Thomson Financial/PwC for previous years data.

Evolution Activity Flows

27.5

74

.3

27.0

48.0

25.4

20.3

71.8

27.5

40.0

20.0

112.3

68

.3

71.2

36.9

29.127.6

24.3

35

14.5

25.1

9.7

47.1

7.05.88.6

33.1

9.112.5 10.7 13.6

29.8

19.6

23

.3

0

10

20

30

40

50

60

70

80

90

100

110

120

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Funds Raised

Investments

Divestments

Source: PEREP_Analytics for 2007 figuresEurope = location of PE firm

2007 Fundraising – Profile Incremental amount raised for each 2007 closing

Early- Stage5%

Small & Mid-Buyouts34.1%

Expansion/ Develop-

ment8%

2007

13 funds closing > €1bn = 53% of total

Early- Stage6%

Small & Mid-Buyouts

36%

Expansion/ Develop-

ment11%

2006

13 funds closing > €1bn =47% of total

Source: PEREP_Analytics for 2007 figures

2007 Fundraising – Profile Full amount raised at final 2007 closings

FUND STAGEAmount (mil

€) Nr funds Avrg Fund size

Early-stage 783 8 97.9

Development 2,940 13 226.2

Balanced 1,892 16 118.3

All Venture 5,615 37 151.8

Buyouts 53,769 57 943.3

Of which > €1 bn 40,486 11 3,680.5

Mezzanine 3,771 5 754.2

Generalist 4,091 21 194.8

Independent Funds 67,246 120 560.4

SPECIALISED FUNDS Amount (mil €) Nr funds

Energy and Environ. 595 5

ICT 1,183 9

Life sciences 1090 6

Source: PEREP_Analytics

2007 Fundraising – Profile Full amount raised at final 2007 closings

0

100

200

300

400

500

600

700

800

900

1,000

Early- stage Development Balanced All Venture Buyouts Mezzanine Generalist All PE(independent

funds)

Average Fund size

# 8

# 13

# 16# 37

# 57

# 5

# 21

# 120


Typology of LPs behind the 2007 fundraising

Academic Institutions

3.6%

Capital Markets

1.2%

Other4.1%

Corporate Investors

3.7%

Private Individuals

8.9%

Fund of Funds18.2%

Insurance Companies

10.1%Pension Funds27.1%

Banks14.4%

Government Agencies

8.7%

2006

Academic Institutions

0.3%

Endowments and

Foundations2.7%

Other6.1%

Family Offices1.2%

Capital Markets

7.8%

Other Asset Managers

2.3%

Corporate Investors

1.7%

Private Individuals

5.5%

Fund of Funds13.3%

Insurance Companies

10.3%

Pension Funds25.3%

Banks16.2%

Government Agencies

7.3%

2007


21.3%

North America26.4%

12.2%

AustralAsia

9.3%

14.3%

Location of LPs behind 2007 Fundraising

5.5%

Rest of World0.9%

5.8%

4.3%

European investments at €68.3 Billion (Equity only from private equity funds)

8.514.4 15.3

12.117.9 20.7

26.6

34.4

53.9 56.8

4.1

6.0

10.7

19.7

12.2

9.88.4

10.3

12.7

17.3 11.5

5.60

10

20

30

40

50

60

70

80

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007Prel.

€ billion

Venture Capital

Buyout


Investments by stage of financing

10,3186,16067,80068,500Total in numbers (€ mil)

100.0%100.0%100.0%100.0%Total in %

34.6%

35.6%

1.8%

28.0%

18.6%

7.9%

1.0%

0.5%

2007 %

By number inv

32.5%

41.1%

3.6%

22.8%

18.4%

3.7%

0.4%

0.4%

2006 %

-61%

-16%

+11%

+11%

+1%

+27%

+103%

-31%

07/06

Growth Rate Amt

10.5%4.1%Early stage

15.4%12.9%Expansion

5.2%5.7%Replacement capital

68.9%77.3%All buyouts

6.8%6.7%Small

25.9%32.5%Mid - market buyouts

10.2%20.4%Large buyouts

26.1%17.7%Mega buyouts

2006 %

2007%

By amount invINVESTMENTS BY STAGE


Stage Distribution of InvestmentsAmount Invested

Buyout70.7%

Replace-ment

Capital5.0%

Expansion16.0%

Start-up8.0%

Seed0.3%

2006

Buyout77.0%

Replace-ment

Capital6.1%

Rescue/Turnaround

0.1%

Expansion12.5%

Start-up4.1%

Seed0.2%

2007


Stage Distribution of InvestmentsNumber of Investments

Buyout23.1%

Replace-ment

Capital3.6%

Expansion43.1%

Start-up25.8%

Seed4.4%

2006

Buyout27.2%

Seed7.6%

Start-up27.5%

Expansion34.9%

Rescue/Turnaround

0.9% Replace-ment Capital

1.9%

2007


Industrial SectorsAmount Invested – All Private Equity

0 2 4 6 8 10 12 14 16 18

Agriculture

Unspecified

Construction

Chemicals and materials

Transportation

Energy and environment

Financial services

Computer and consumer electronics

Life sciences

Business and industrial services

Communications

Business and industrial products

Consumer goods and services

€billion

2007

2006


Industrial Sectors% of Amount Invested in 2007 – by Segment

0.6%

0.7%

3.8%

4.0%

5.1%

4.8%

3.6%

3.8%

10.8%

9.1%

11.0%

13.5%

14.2%

14.9%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Real estate

Agriculture

Unspecified

Construction


Transportation

Financial services



Consumer services: other

Life sciences

Communications



Consumer goods and retail

percent

Venture Capital

Buyouts


€23.3 Billion European Divestment at CostAll Private Equity

14.1% 17.5% 18.0% 18.2%

6.0% 2.9% 4.0% 5.4%

15.9%21.3%

23.3% 17.1%

20.2%13.1%

18.4%

16.6%

11.6%9.7%

4.7%

3.8%

6.2%7.0%

4.5%

7.2%

5.6%4.8% 4.5%

9.0%

20.4% 23.7% 22.6% 22.7%

11.8%

3.3%

19.0%

29.7%

2.0%4.8%

4.5%

24.9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2003 2004 2005 2006 2007

Trade Sale

IPO

Sale of Quoted Equity

Write- Off

Secondary

Repayment of Shares/Loans

Sale to Financial Institution

Other


2007 European Divestments by Segment

Trade SaleRepayment of principal loansSale to another PE house

Venture Buyouts

€ 1.4 bn € 6.2 bn

€ 0.6 bn € 4.0 bn

€ 0.5 bn € 3.7 bn

364

496

65

226

278

265

# of div # of div

2007 Top Exit routes:


Industrial Sectors% of Amount Divested in 2007 – by Segment

0.8%

1.8%

1.7%

4.3%

4.2%

4.7%

6.4%

5.1%

3.4%

7.4%

10.1%

12.2%

17.3%

20.6%

0% 20% 40% 60% 80% 100%

Real estate

Agriculture

Construction

Financial services



Unspecified

Transportation


Life sciences

Consumer services: other


Communications

Consumer goods and retail


percent

Venture Capital

Buyouts


Divestments by Exit Type

Divestments by Exit Type By amount inv. By number of div.

2007%

2006 %

2007 %

2006 %

Trade Sale 24.9 22.7 23.0 16.7

IPO 4.5 9.0 3.3 2.6

Sale of Quoted Equity 4.8 7.2 5.1 9.2

Write-Off 2.0 3.8 7.4 9.0

Repayment of silent partnership

0.1 0.8 4.7 5.4

Repayment of Principal Loans 19.0 17.1 25.4 17.9

Secondary 29.7 16.6 9.3 6.5

Sale to Financial Institution 3.3 5.4 1.4 3.4

Sale to Management (MBO) 3.5 6.1 6.9 17.6

Other 8.2 11.3 13.5 11.7

Total Divestment in Year 100.0 100.0 100.0 100.0


Conclusions

Despite record fundraising in 2006 and difficult market conditions in second half of 2007, appetite of investors towards the asset class remains undeterred as reflected by the 2007 fundraising figures;

What drives private equity deal making is mid-market buyouts by amount invested and expansion deals by number of investments;

Venture backed companies are exited mainly by trade sale, while buyout backed companies are sold mainly to other private equity firms. Main sectors divested are life sciences for venture-backed companies and business and industrial products for buyout backed companies in 2007.

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2007 European Private Equity Activity Survey PEREP_Analytics™

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