The Italian private equityand venture capital market

Carlo MammolaAlternative Investment Forum - London 13th March 2006

Private equity marketPrivate equity market

Expansion / Expansion /

ReplacementReplacement

Buy OutBuy Out

Seed / Start upSeed / Start upVentureVentureCapitalCapital

PrivatePrivateEquityEquity

Early stageEarly stage

Later stageLater stage

Distressed / turnaround

AIFI membersAIFI members

1522 24

28 30 30 31 30 32 33 34

4955 58

73

86

77 79 82

92

0

10

20

30

40

50

60

70

80

90

100

'86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 2000 2001 2002 2003 2004 2005

Investment activity by number and amountInvestment activity by number and amount

140

944

1.773

2.968

2.185

2.626

3.034

1.480

1.205

248336301489390

269

646

-

500

1.000

1.500

2.000

2.500

3.000

3.500

1998 1999 2000 2001 2002 2003 2004 1st sem2005

Number Amount (Euro mln)

 Fonte: Aifi/PwC

Amount invested in different European countriesAmount invested in different European countries

5.227

3.766

1.480

1.9671.6591.622

19.086

-

5.000

10.000

15.000

20.000

2000 2001 2002 2003 2004

Italy France Spain Germany Netherlands Sweden UK

Fonte: EVCA, 2005

Number of investments in different European countriesNumber of investments in different European countries

1.956

1.477

248475592

697

2.783

-

800

1.600

2.400

3.200

2000 2001 2002 2003 2004

Italy France Spain Germany Netherlands Sweden UK

Fonte: EVCA, 2005

Europe: % on GDP ( country of management) in 2004Europe: % on GDP ( country of management) in 2004

Fonte: EVCA, 2005

35% 39%53%

46%

16% 19% 20% 17%

34%35%

36%38%

46%52% 51% 51%

13% 4%

3% 10%

13%11% 10%

6%

18% 21%8% 6%

25%18% 19%

26%

0%

20%

40%

60%

80%

100%

1998 1999 2000 2001 2002 2003 2004 1 st sem

2005

Early stage Expansion Replacement Buy out

Stage distribution of investments in ItalyStage distribution of investments in Italy

Fonte: Aifi/PwC

16%8%

18% 13%2% 2% 2% 1%

36%

22%

33%34%

31%19%

31%

14%

14%

5%

3% 6%

8%

4%

6%

3%

34%

65%

46% 47%59%

74%62%

82%

0%

20%

40%

60%

80%

100%

1998 1999 2000 2001 2002 2003 2004 1 st sem

2005

Early stage Expansion Replacement Buy out

Stage distribution of amount invested in ItalyStage distribution of amount invested in Italy

Fonte: Aifi/PwC

38%

27%

14%

9%7%

5%

39%

13%

6%9%

5%

28%

0%

10%

20%

30%

40%

0-19 20-99 100-199 200-499 500-999 > 1,000

2004 1st Sem 05

% distribution (number) by target companies employees% distribution (number) by target companies employees

Fonte: Aifi/PwC

22%

27%

31%

36%

51%

51%

30%

15%

11%

5%

11%

46%

7%

12%

18%

23%

0% 20% 40% 60%

1 st sem 2005

2004

2003

2002

2001

2000

1999

1998

Number Amount

% of investments in high tech companies by number and amount in % of investments in high tech companies by number and amount in ItalyItaly

Fonte: Aifi/PwC

Divestment activity by number and amount (at cost) in ItalyDivestment activity by number and amount (at cost) in Italy

129170 186

149 143

222

13775

333

578

465

909

589

868

647

333

0

200

400

600

800

1.000

1998 1999 2000 2001 2002 2003 2004 1 st sem2005

Number Amount (Euro mln)

 Fonte: Aifi/PwC

63%46%

58% 55% 52% 52%36%

44%

7%

8%

10%3%

18%10%

11%

19%

12%

12%

11%

8%

3%5%

10%

15%

9%

3%

5%

13%

18%13%

23%

5%

9%

31%16% 21%

9%20% 20% 17%

0%

20%

40%

60%

80%

100%

1998 1999 2000 2001 2002 2003 2004 1 st sem

2005

Trade sale Sale to VC - Fin. Inst. IPO - Sale post IPO Write off Other

% distribution of divestments by number in Italy% distribution of divestments by number in Italy

Fonte: Aifi/PwC

14.480

9.535

-

2.000

4.000

6.000

8.000

10.000

12.000

14.000

16.000

Eur

o m

ln

Total funds under management at 30th of June 2005*Portfolio at cost at 30th of June 2005*

Funds available*

4.945

* Pan-European funds and captive investors not included.

Funds under management in ItalyFunds under management in Italy

Fonte: Aifi/PwC

Annual fund raising activity in Italy (Euro Mln)Annual fund raising activity in Italy (Euro Mln)

1.051

2.207

2.925

1.8751.996 1.937

1.663

526

-

500

1.000

1.500

2.000

2.500

3.000

3.500

1998 1999 2000 2001 2002 2003 2004 1 st sem2005

 

* Pan-European funds not included.

Fonte: Aifi/PwC

24%

21%

15% 14%

8%6%

4%

0%

8%

40%

20%

3%

12%

4%

0,1%2%

19%

0,1%0%

10%

20%

30%

40%

Banks PensionFunds

Fund ofFunds

CorporateInvestors

InsuranceComp.

PrivateInvestors

Public Sector Endowments Other

2004 1st Sem 05

% distribution by sources of new funds raised by Italian funds% distribution by sources of new funds raised by Italian funds

Fonte: Aifi/PwC

Italy: Economic impact on buy-out target companies (1998-Italy: Economic impact on buy-out target companies (1998-2000)2000)

Fonte: INSEAD - LIUC, 2001

1,0%

4,8%

7,6%

1,60%

22,70%

11,70%

2,0%

-1,5%

3,8%

-5% 0% 5% 10% 15% 20% 25% 30%

Pre buy-out Post buy-out Benchmark Mediobanca

∆ Turnover

∆ EBIT

∆ Employees

Europe: economic impact on venture backed companies Europe: economic impact on venture backed companies (1995-2001)(1995-2001)

Fonte: EVCA, 2002

71,0%

50,0%

69,0%

73,0%

15,0%

40,0%

18,0%

12,0%

11,0%

14,0%

13,0%

12,0%

0% 20% 40% 60% 80%

Increase Stability Decrease

Employees

R&S

Exports

Investments

AIFIAIFI

AIFI is the Italian Private Equity and Venture Capital Association

AIFI’s main activities are:

•Institutional and lobbying activities

•Research

•Training programmes

•Networking

To carry out these activities AIFI relies on Technical Committees:

•Corporate Governance

•High tech

•Tax& Legal

•Relationship with Institutional Investors

BA Capital Partners Europe (BACPE) is a European private equity partnership managing over €1.5 billion of private equity capital on behalf of Bank of America. Active in the European market since 1996, BACPE focuses on buyouts of industry leading growth companies operating in the following broad industry sectors: industrial growth, business services, and consumer products and services.

In brief

•Over €1.0 billion invested to date

•Between €25 million and €125 million invested in companies with an enterprise value of

between €50 million and €500 million

•European network with presence in UK, Italy, France and the Nordic region

•A team with a deep industry knowledge of target sectors in the UK, French, Italian and

Nordic markets.

An introduction to BA Capital Partners EuropeAn introduction to BA Capital Partners Europe

Selected past investmentsSelected past investments

Target industry Consumer products and services

Target industry Business services

Target industry Industrial growth

GRUPPO

ALFATHERM

The Italian private equityand venture capital market

Carlo MammolaAlternative Investment Forum - London 13th March 2006