This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
www.peimedia.com
Executive Summary
This report presents an overview of the 2009 PEI 300, which ranks private equity firms around the world by size, using Private Equity International’s unique, apples-to-apples methodology. A complete report on the PEI 300 is featured in the May 2009 issue of Private Equity International, available only to subscribers or for individual purchase.
About the PEI 300 and PEI MediaThe PEI 300 firms are ranked based on the amount of private equity direct-investment capital each have raised or formed over a roughly five-year period beginning 1 January 2004 and ending 15 April 2009.
Private Equity International is the leading publication for the private equity industry. It is published monthly by PEI Media, which provides market intelligence and events for professionals in the private equity, real estate and infrastructure asset classes.
For more information about the PEI 300, contact PEI Media executive editor David Snow at [email protected].
Private Equity International magazine’s proprietary ranking of the largest 300 private equity firms in the world
PEI 300 2009
PE Connect
PE Connect is the definitive online database trackinginvestors in private equity and venture capital fundsworldwide. Part of the world’s foremost private equityinformation group, it is widely regarded as the most reliableroute to funds for the private equity industry worldwide.
The surest way to sharpen your edge• Search and compare almost 3,500 LP profiles• Access new sources of capital from new types of
investors and countries• Target LPs according to geographic or fund type
appetite, assets under management orprevious investments
• Gain a competitive edge when searching forcapital with PE Connect news and a FREEsubscription to Privateequityonline
To subscribe or for a free demonstration, please call Steven Randellon +1 212 645 1919 or +44 (0) 20 7566 5460 or email [email protected]
Investor Intelligence. From a source you can trust.
Win the race for funds
www.privateequityconnect.comPRIVATE EQUITY INTERNATIONAL
Now with fund performance,analytics and GP data
4852 PE Connect Ad Updates 4.qxd:. 20/4/09 16:46 Page 1
www.peimedia.com
2009 PEI 300 Executive Summary page 3
The PEI 300Although 2009 marks the debut of the PEI 300, this is the third year in a row that Private Equity International has ranked the largest 50 private equity firms in the world, called the PEI 50. As with last year, the line-up of the top 50 firms has not remained static. Some firms managed to close sizeable fundraisings, which boosted their respective ranks significantly, or allowed them to debut on the top 50 list. As in prior years, the PEI 300 based its rankings on this measure: the amount of private equity direct-investment capital raised or created over the past five years. See p. 10 for greater detail on the PEI 300 methodology.
Capital raised OVer 2008 rank name Of firm Headquarters last fiVe years ($Bn) rank
1 TPG Fort Worth (Texas) $52.35 3
2 Goldman Sachs Principal Investment Area New York $48.99 2
3 The Carlyle Group Washington DC $47.73 1
4 Kohlberg Kravis Roberts New York $40.46 4
5 Apollo Global Management New York $35.18 6
6 Bain Capital Boston $34.95 7
7 CVC Capital Partners London $33.73 5
8 The Blackstone Group New York $30.8 10
9 Warburg Pincus New York $23 11
10 Apax Partners London $21.33 9
11 First Reserve Corporation Greenwich (Connecticut) $20.89 23
280 Institutional Venture Partners Menlo Park $900
281 Sigma Partners Boston $900
282 ICICI Venture Mumbai $892
283 Palamon Capital Partners London $884
284 DCM Menlo Park $880
285 Charles River Ventures Waltham (Massachusetts) $855
286 Eos Partners New York $853
287 Oakley Capital Investments London $851
288 Ventizz Capital Duesseldorf $851
289 Aureos London $850
290 Littlejohn & Co. Greenwich (Connecticut) $850
291 Lightyear Capital New York $850
292 Bay City Capital San Francisco $850
293 Morgenthaler Partners Menlo Park $850
294 Gresham Private Equity London $846
295 GGV Capital Menlo Park $840
296 Accent Equity Partners Stockholm $831
297 HM Capital Dallas $830
298 Quadriga Capital Frankfurt $829
299 Chequers Capital Paris $825
300 Thoma Bravo Chicago $822*Not
es:
“Fiv
e ye
ars”
defi
ned
as 1
Jan
uary
200
4 to
pre
ss t
ime
on 1
5 A
pril
2009
Firm
s w
ith
the
sam
e fiv
e-ye
ar f
undr
aisi
ng t
otal
are
fur
ther
ran
ked
base
d on
siz
e of
larg
est
fund
, the
n m
ost
rece
nt c
losi
ng o
f fu
nd
A
ll cu
rren
cies
hav
e be
en c
onve
rted
at
a se
t of
sta
ndar
d ex
chan
ge r
ates
*Not
es:
“Fiv
e ye
ars”
defi
ned
as 1
Jan
uary
200
4 to
pre
ss t
ime
on 1
5 A
pril
2009
Firm
s w
ith
the
sam
e fiv
e-ye
ar f
undr
aisi
ng t
otal
are
fur
ther
ran
ked
base
d on
siz
e of
larg
est
fund
, the
n m
ost
rece
nt c
losi
ng o
f fu
nd
A
ll cu
rren
cies
hav
e be
en c
onve
rted
at
a se
t of
sta
ndar
d ex
chan
ge r
ates
page 10 PEI 300 Executive Summary 2009
www.peimedia.com
Rules of the gameWhat the PEI 300 does and does not measure
Would you believe that ranking 300 private equity firms by size is not an easy task?
First one needs to define “private equity” and “size”. Then one needs to gather accurate capital-formation information on hundreds of firms in what is among the most opaque markets in the world.
The result of this hard work is the PEI 300, an expansion of an earlier annual ranking conducted by Private Equity Interna-tional called the PEI 50. Responding to demand from our read-ers, we have simply applied the same rules governing the PEI 50 rankings to a much larger population of firms.
In compiling the rankings, we are certain that we missed some important details, but we are equally certain that we exhausted every available resource in sourcing the best information. Pri-vate equity remains a non-transparent asset class, but it is get-ting more transparent with each passing year. We therefore be-lieve that the PEI 300 will become more and more authoritative as a guide to the most important investment firms in the global private equity market.
A firm’s rank among the largest 300 private equity firms in the world is determined by how much private equity direct-investment capital that firm has raised over a roughly five-year window ending at our press date last month.
What is the Pei 300?
The PEI 300 is a ranking of private equity firms globally by size. It is the only apples-to-apples comparison of dedicated, direct-in-vestment private equity programmes. The rankings began in 2007 as the PEI 50 and was expanded to the PEI 300 in 2009 due to demand for more information about private equity firms globally.
The PEI 300 is not a performance ranking, nor does it consti-tute investment recommendations. The PEI 300 includes private equity firms with varying structures and strategies around the world. While the list is mostly made up of private equity firms that manage private equity limited partnerships, it also includes firms with multiple strategies and business lines, and firms with publicly traded vehicles.
However, only a defined type of private equity capital is counted in determining the PEI 300 rankings, as described be-low. The PEI 300 only measures capital raised or formed within a five-year window spanning from 1 January 2004 until 15 April 2009. Last year’s rankings were also drawn from a 64-month window, but of course last year the window started on 1 January 2003 and ended on 15 April 2008.
Where two firms have raised the same amount of capital over this time period, the higher PEI 300 rank goes to the firm with the largest active pool of capital raised since 2004 (i.e., the big-gest single fund). If there is still a “tie” after taking into account size of single fund, we give greater weight to the firm that has raised the most capital most recently.
In coming up with our key “2009 PEI 300 Five-Year Fundrais-
ing Total” figures, upon which the PEI 300 rankings are based, we rely on the most accurate information available. We give highest priority to information that we receive from or confirm with the private equity firms themselves, always on background. When the private equity firms themselves confirm details, we still seek to “trust but verify”.
Some details simply cannot be verified by us, and in these cases we defer to the honour system. In order to encourage coopera-tion from private equity firms that might make the PEI 300, we do not disclose which firms have aided us on background and which have not. Lacking confirmation of details from the firms themselves, we seek to corroborate information using any avail-able resources, including the firms’ own websites, press releases, news reports, third-party databases, limited partner disclosures, etc.
Definitions
To help answer this question – how much private equity capital has the firm raised since 1 January 2004? – we needed to set some definitions:
“Private equity”: The definition of private equity for the purposes of the PEI 300 means capital raised for a dedicated programme of investing directly into businesses. This includes equity capital for diversified private equity, buyouts, growth equity, venture capital, turnaround or control-oriented distressed investment capital, and mezzanine debt. Our rankings do not take into account funds of funds capital, capital raised for primarily real estate strategies, hedge fund capital, infrastructure and debt capital.
“Capital raised”: This means capital definitively committed to a private equity direct investment programme. In the case of a fundraising, it means the fund has had a final or official interim close after 1 January 2004. We count the full amount of a fund if it has a close after this date. We also count the full amount of an interim close that has occurred recently, even if no offi-cial announcement has been made. We also count capital raised through other means, such as LP co-investment vehicles, deal-by-deal LP co-investment capital, publicly traded vehicles and earmarked annual contributions from a sponsoring entity, when we are able to access this information. Where capital is raised in partnership with an affiliated entity, we take into consideration the economic relationship between the two entities, as well as how the fundraising was marketed to investors.
We count mezzanine debt raised by firms that are primarily en-gaged in private equity investing. We only count equity raised for these funds, not the leveraged “buying power”. Mezzanine debt frequently involves warrants for equity stakes, and has historically been counted alongside buyout capital by industry media and data services groups.
www.peimedia.com
2009 PEI 300 Executive Summary page 11
By the numbersHow the PEI 300 firms relate to each other, to last year’s list and to the broader deal economy
Source: Private Equity International
0 500 1000 1500 2000 2500
0 500 1000 1500 2000 2500
Capital raised since 2002
$545bn
$2,322bnGlobal IPOs/Follow-on offerings
PEI 50
North America 68% UK 20% W. Europe 10% Asia Pacific 2%
68% North America
United Kingdom
20%
W. Europe
10% Asia Pacific
2%
$0
$150
$300
$450
$600
$750
$900
$813
$524
Top 50 Next 250
Five
-yea
r fun
drai
sing
tota
l ($b
n)
0
$200
$400
$600
$800
$1000
Five
-yea
r fun
drai
sing
tota
l ($b
n)
PEI 50 2007 PEI 50 2008 PEI 50 2009
$551
$810 $813
0 500 1000 1500 2000 2500
0 500 1000 1500 2000 2500
Capital raised since 2002
$545bn
$2,322bnGlobal IPOs/Follow-on offerings
PEI 50
North America 68% UK 20% W. Europe 10% Asia Pacific 2%
68% North America
United Kingdom
20%
W. Europe
10% Asia Pacific
2%
$0
$150
$300
$450
$600
$750
$900
$813
$524
Top 50 Next 250
Five
-yea
r fun
drai
sing
tota
l ($b
n)
0
$200
$400
$600
$800
$1000
Five
-yea
r fun
drai
sing
tota
l ($b
n)
PEI 50 2007 PEI 50 2008 PEI 50 2009
$551
$810 $813
Top 50 vs. nexT 250Over the past five years, the largest 50 firms in the world have raised some 55 percent more equity capital than the next 250 firms
Where They’re basedAlthough many of the PEI 300 firms are globally active, a look at their headquarters shows the continued dominance of North America and the UK in the private equity industry
TWo years of climbingThese top 50 firms have advanced in our rankings for two consecutive years
ouT of The 50These firms appeared in last year’s top 50 but not in this year’s top 50
sloWing aT The TopThe largest 50 firms in the world did not raise significantly more capital during the five year window ending last month than during similar windows ending in the two prior years
0 500 1000 1500 2000 2500
0 500 1000 1500 2000 2500
Capital raised since 2002
$545bn
$2,322bnGlobal IPOs/Follow-on offerings
PEI 50
North America 68% UK 20% W. Europe 10% Asia Pacific 2%
68% North America
United Kingdom
20%
W. Europe
10% Asia Pacific
2%
North America65%
UK11.3%
Europe ex-UK11.3%
Asia8%
MENA2.7%
Africa1% Latin America
0.7%
TPGApollo Global ManagementBain CapitalWarburg PincusAmerican CapitalFortress Investment GroupClayton Dubilier & RiceJC Flowers & Co.WL Ross & Co.Bridgepoint
pei 50 ouTperforms resT of The packAccording to State Street Private Edge (SSPE), the PEI 50 outperformed the next 250 largest firms and the industry as a whole, tracked by the SSPE Index. Non-US PEI 50 firms lead by a clear margin
pei 300 deals vs. The WorldAccording to Dealogic, PEI 300 firms spoke for more than 10 percent of global M&A over the past five years
sloWing deals for The Top 50The largest 50 firms did fewer deals during the five year window ending April 2009 than the previous period
hoW They spenT iTThe PEI 300 invested $1.81 trillion in a broad array of industries around the world since 1 January 2004
Where They spenT iTThe PEI 300 have invested in diverse locations around the world since 1 January 2004
0 500 1000 1500 2000 2500
0 500 1000 1500 2000 2500
Capital raised since 2002
$545bn
$2,322bnGlobal IPOs/Follow-on offerings
PEI 50
North America 68% UK 20% W. Europe 10% Asia Pacific 2%
68% North America
United Kingdom
20%
W. Europe
10% Asia Pacific
2%
$0
$5
$10
$15
$20
Deal
val
ue ($
tr)
Deal
val
ue ($
tr)
$1.19
PEI 50 2007 PEI 50 2008 PEI 50 2009
Deal
val
ue ($
tr)
$0.0
$0.3
$0.6
$0.9
$1.2
$1.5 $1.39 $1.37
$1.81
PEI 300
$17.41
All M&A
$0.0
$0.5
$1.0
$1.5
2.0
$2.5
$1.81
PEI 300
All PE
$2.08
0 500 1000 1500 2000 2500
0 500 1000 1500 2000 2500
Capital raised since 2002
$545bn
$2,322bnGlobal IPOs/Follow-on offerings
PEI 50
North America 68% UK 20% W. Europe 10% Asia Pacific 2%
68% North America
United Kingdom
20%
W. Europe
10% Asia Pacific
2%
$0
$5
$10
$15
$20
Deal
val
ue ($
tr)
Deal
val
ue ($
tr)
$1.19
PEI 50 2007 PEI 50 2008 PEI 50 2009
Deal
val
ue ($
tr)
$0.0
$0.3
$0.6
$0.9
$1.2
$1.5 $1.39 $1.37
$1.81
PEI 300
$17.41
All M&A
$0.0
$0.5
$1.0
$1.5
2.0
$2.5
$1.81
PEI 300
All PE
$2.08
Notes: Based on data compiled from 1437 private equity funds, including fully liquidated partnerships, formed between 1990 to 2008 Q3. IRR: Pooled Average IRR is net of fees, expenses and carried interest. Pooled average IRR treats sample funds as a single “fund” by adding together all cash flows and net asset values. Rather than averaging returns for each sample fund, returns are calculated on the underlying “pooled” portfolio.
Source: State Street Private Edge
Notes: Excludes real estate and infrastructure deals Source: Dealogic
Notes: Excludes real estate and infrastructure dealsSource: Dealogic
0 500 1000 1500 2000 2500
0 500 1000 1500 2000 2500
Capital raised since 2002
$545bn
$2,322bnGlobal IPOs/Follow-on offerings
PEI 50
North America 68% UK 20% W. Europe 10% Asia Pacific 2%
68% North America
United Kingdom
20%
W. Europe
10% Asia Pacific
2%
Telecommunications17.6%
North America58.5%
Europe34.9%
Asia5.1%
Latin America0.7%
Africa0.6% Middle East
0.2%
Healthcare13.8%
Computers &electronics
12.4%Retail11.5%
Utility &energy11.3%
Finance10%
Professionalservices
9.0%
Dining & lodging
7.9%
Transportation6.5%
0 500 1000 1500 2000 2500
0 500 1000 1500 2000 2500
Capital raised since 2002
$545bn
$2,322bnGlobal IPOs/Follow-on offerings
PEI 50
North America 68% UK 20% W. Europe 10% Asia Pacific 2%
68% North America
United Kingdom
20%
W. Europe
10% Asia Pacific
2%
Telecommunications17.6%
North America58.5%
Europe34.9%
Asia5.1%
Latin America0.7%
Africa0.6% Middle East
0.2%
Healthcare13.8%
Computers &electronics
12.4%Retail11.5%
Utility &energy11.3%
Finance10%
Professionalservices
9.0%
Dining & lodging
7.9%
Transportation6.5%
Notes: Excludes real estate and infrastructure deals
Source: Dealogic
Notes: Excludes real estate and infrastructure deals
Source: Dealogic
pei 50 irr pei 300 irr sspe index irrpooled average 13.45% 13.38% 12.92%
By investment focus Buyout 13.50% 13.29% 13.38%Venture capital 14.13% 12.87% 12.01%Mezzanine and others 12.69% 13.55% 10.60%
By geography US 13.36% 13.31% 12.47%Non-US 15.67% 15.48% 15.61%
PRIVATE EQUITY MATHEMATICS
Private Equity Mathematicswill help you to:
• Understand the nuances of privateequity performance
• Learn about PE cash flows withdifferent models
• Assess the inherent risk of PE fundinvestments
• Discover how to measure PEperformance in detail
• Find out how you can actually estimatealpha in a PE portfolio
• See how valuations are calculated inbuyouts and venture
• Appreciate how management fees andcarried interest work