Spotlight August 2009

SuperReturn Middle East 2009

3rd Annual Middle East, North Africa, Turkey and South Asia’s Private Equity and Venture Capital Summit

11th-14th October 2009, Grand Hyatt, Dubai

http://www.icbi-events.com/KN2215PQEM1

Dear Spotlight Subscriber,

Preqin is delighted to have arranged a special invitation and 15% discount for Spotlight readers who would like to attend SuperReturn Middle East 2009 in Dubai on October 11th-14th, 2009.

SuperReturn Middle East has an entirely re-invented interactive, dynamic and networking agenda with a host of features and sessions designed to enable you to meet and exchange ideas with LPs and GPs alike – perfect for you to exploit every minute of your time at the event, and make every moment pay.

Please contact the SuperReturn Middle East Forum 2009 Team directly: on +44 (0) 207 017 7200 or email [email protected], and be sure to quote the Priority code KN2215PQEM1 to secure your 15% discount.

I’ll be chairing a session at the conference, and hope to have an opportunity to connect with you there.

Kindest regards,

Mark O’Hare Managing Director Preqin

For more information contact the SuperReturn Middle East Forum 2009 Team directly: Quote Priority code: KN2215PQEM1 Call: +44 (0) 207 017 7200 Email: [email protected] Web: http://www.icbi-events.com/KN2215PQEM1 Private Equity Spotlight www.preqin.com August 2009 / Volume 5 - Issue 8

Welcome to the latest edition of Private Equity Spotlight, the monthly newsletter from Preqin, providing insights into private equity performance, investors and fundraising. Private Equity Spotlight combines information from our online products Performance Analyst, Investor Intelligence, Fund Manager Proﬁ les & Funds in Market.

Investor Survey Results Special

Fundraising Spotlight Feature Article page 3 page 13

Current Investor Attitudes to Private Equity This month’s Fundraising Spotlight takes an in-depth look at buyout, venture and fund of funds private equity fundraising. Over one week in July 2009 Preqin’s Investor Intelligence team conducted a survey of 100 of the most signifi cant institutional investors in private equity. This month’s feature article takes a look at the results and what this means for the fundraising market in the Conferences Spotlight second half of 2009. page 18

We look at the upcoming events in the private equity world.

Performance Spotlight page 9

The Eff ect of Private Equity Performance on the Current Investor News page 21 Fundraising Environment All the latest news on secondaries and private equity investors; This month we look at how private equity performance has aff ected fundraising for new vehicles and why this years total Including... capital raised looks set to be signifi cantly lower than in previous years. • Adams Street Partners

• ERA Foundation

• Korea Investment Corporation Fund Manager Spotlight page 11 New York Buyout Firms • Jade Invest

This month’s fund manager profi le looks at New York buyout fi rms and examines the number, size and preferences of the funds they raise. Be the ﬁ rst to know about all our exclusive research reports and projects, follow us on www.twitter.com/preqin

If you would like to receive Private Equity Spotlight each month please email [email protected].

Subscribers to Performance Analyst and Investor Intelligence OUT NOW receive additional information not available in the free version. If you would like further details please email [email protected] The 2009 Preqin Fund Terms Advisor Publisher: Preqin Ltd. Scotia House, 33 Finsbury Square, London. EC2A 1BB More information available at: www.preqin.com/fta Tel:T +44 (0)20 7065 5100 w: www.preqin.com

Feature Article: Current Investor Attitudes to Private Equity

Much has changed in the private equity industry in the past year. The global Fig. 1: ﬁ nancial crisis had a massive impact on the asset class, not just on the investments made by fund managers, When Are Investors Expecting to Next Make Private Equity Fund Commitments? but also on the institutional investors in private equity funds, their opinions of the 60% industry and their ability to make fresh 54% commitments. 50%

The evidence for this can clearly be 40% seen in recent fundraising fi gures: in Q2 2009, 89 private equity funds 30% 25% reached a fi nal close securing $79.7bn between them, considerably less than 20% the $194.5bn raised by the 274 funds Proportion of Investors to hold a fi nal close in the same quarter 10% 7% 6% 7% the previous year. But to what extent is this drop in fundraising a result of shifting 0% investor attitudes to the asset class, how Will Invest in Will Invest in Will Invest in Considering Unlikely to Invest 2009 2010 2011 or later in Next 2 years permanent is the apparent decline in investor appetite for funds and when are investors likely to return to the market? Fig. 2: Using Investor Intelligence, Preqin’s database containing profi les for over 4,000 investors in private equity, we Investors’ Intentions for Their Private Equity Allocations conducted a survey of 100 signifi cant institutional investors over a single week in July 2009 to obtain a unique snapshot of their views of the industry at the current time and to see how active LPs anticipate being in the asset class in the coming months and years. This article contains some highlights from the full report, which can be found on our website: www.preqin.com/investorsurvey Proportion of Investors Future Private Equity Investments

Just 41% of the investors we polled told us they had committed to private equity funds in the past six months. But when can we expect more LPs to return to the market and make fresh the asset class in the next 18 months, investing further in the next two years. commitments? As Fig. 1 shows, a reassuring news for fund managers We asked investors whether they considerable 79% of investors expect currently engaged in, or intending to expected their allocations to private equity to make new commitments to funds commence, fundraising. In fact, more to increase in the next 12 months and, in either this year or next, showing that than half of investors are seeking to addition, whether they foresaw their long- large numbers of investors can be make commitments before the end of term target allocations increasing over the expected to recommence investment in 2009. Just 7% told us they would not be next three to ﬁ ve years. As Fig. 2 shows,

4 ◄

Feature Article August 2009 ... investor appetite for private equity is still strong and that “ most LPs still intend to remain active in private equity over the “ longer term...

in the short term, investors’ allocations to private equity are expected to remain Fig. 3: broadly the same, with just 11% of investors informing us that they expected the overall level of their exposure to the Current Levels of Private Equity Allocations Compared to Target Allocations asset class would go up, whilst the vast majority, 80%, expected their current allocations to private equity to remain at the same level as a proportion of their overall investment portfolios.

However, it is clear that investor appetite for private equity is still strong and that most LPs still intend to remain active in private equity over the longer

term; just 6% of investors in the asset Proportion of Investors class anticipate decreasing their target allocations in three to ﬁ ve years. In fact, 30% expect to increase their target allocations over the next few years, showing that, though investors have been holding off from investing in the asset class more recently, as the markets IBC’s Acclaimed Private Equity Transactions and Tax Series Register by 20094th & SeptemberSAVE £50 stabilise, actual investor appetite for the asset class has remained strong, and an increase in investor activity can be Private Equity expected.

Current LP Views of the PE Market Tax Practices The Latest Developments and Thinking on Tax Minimisation Strategies for Fund and Deal With private equity valuations lagging Structures, Investors and Management Teams behind public markets, private equity Authoritative Presentations Addressing: Expert Speakers Include portfolios did not immediately refl ect • Tax Planning for the 50% Income Tax Rate & Anthony Stewart the new fi nancial situation and, as a Non-domiciled Executives Mark Baldwin MACFARLANES CLIFFORD CHANCE consequence, many private equity • International Fund & Deal Structuring • Management Team Issues Kathleen Russ Paul Megson investors found the proportion of their • Benelux Developments TRAVERS SMITH DELOITTE portfolios allocated to private equity • Refinancing Case Study & Panel Debate Willem Bon & Peter Moons Donald Rocap rising signifi cantly as their investments • HMRC Clearances & New Initiative on HNWIs LOYENS & LOEFF KIRKLAND & ELLIS LLP in public equities declined in value. The • Best Strategies for Delivering Carried Interest Tony Bullock • US Tax Issues for Inbound & Outbound Investments Anneli Collins past six months, however, have seen KPMG ERNST & YOUNG private equity valuations fall and as Fig. • VAT & Private Equity Transactions Sarah Woodall & Chris Damien Crossley 3 shows, just 17% of investors are now Plus - SAVE £200 - if you also register for Planning for Employment Related Securities Orchard MACFARLANES fi nding themselves overcommitted to the 14th October 2009, Radisson Blu Portman Hotel, London HM REVENUE & asset class, whereas a considerable 34% (Quote: KW5079DISCOUNT£200) See inside for more details or: CUSTOMS Tel: +44 (0) 20 7017 7790 • Fax: +44 (0) 7017 7824 of investors have yet to reach their target Email: [email protected] • Web: www.ibc-events.com/ERS allocations. Media Partners Organised by 10% DISCOUNT Furthermore, whilst just 12% of European VIP code: KW5072PQAD investors are at present exceeding their 1st October 2009, Le Meridien Piccadilly Hotel, London target allocations to private equity, almost REGISTER TODAY: Tel: +44 (0)20 7017 7790 • Fax: +44 (0)20 7017 7824 Email: [email protected] • Web: www.ibc-events.com/PEtaxpractices

Feature Article: Current Investor Attitudes to Private Equity

a quarter (24%) of North American investors informed us that they were Fig. 4: above their target allocations. Likewise, 44% of European investors also have yet to reach their target allocations in contrast Investor Areas of Interest for Future Private Equity Investments to 26% of North American investors. 35%

Different types of institutional investor 30% have experienced the denominator 25% effect to varying degrees. Some have implemented certain measures, such as 20% raising target allocations to private equity, in order to resolve the issues arising from 15% the effect. Whereas approximately half of the public pension funds and insurance 10%

companies we spoke to informed us that Proportion of Investors 5% they are currently below their targets, no endowment plans told us they were 0% underallocated to the asset class. In Small to Mid- Distressed Secondaries Secondaries Venture Mezzanine Fund of Infrastructure Other None Market Private – Funds – Direct Funds fact, a third of endowments told us they Buyout Equity Purchases of LP Interests were above their target allocations. 40% Fund Type of family ofﬁ ces and foundations also informed us that they were at present From the producers of SUPER 2009 RETURN THE SUPERRETURN Grand Hyatt, Dubai The 3rd Annual Summit: 11 October 2009 exceeding their target allocations. 100+ confirmed speakers: GLOBAL SERIES Conference 12-14 October 2009 Tel: +44 (0)20 7017 7200 ● ● AB CAPITAL LGT CAPITAL Fax: +44 (0)20 7017 7807 PARTNERS ● ABRAAJ CAPITAL Email: [email protected] ● LODH PRIVATE EQUITY Web: www.superreturnme.com ● ABU DHABI COMMERCIAL BANK ● LONDON SCHOOL OF 15% Organised by Areas of Interest in the Private Equity ECONOMICS ● ACROSTIC Discount ● MAF TRUST ● ACTIS QUOTE VIP: ● MALAZ GROUP Market ● AIG INVESTMENTS KN2215PQAD ● MAZRUI HOLDINGS ● AL TOUQ COMPANY ● MCKINSEY ● ALCHEMY PARTNERS www.superreturnme.com ● MENA ● ALIX PARTNERS INFRASTRUCTURE The economic downturn has presented ● ALLIANZ CAPITAL FUND PARTNERS GROUP The Middle East, North Africa, Turkey & South Asia ● MORGAN STANLEY ● AMWAL ALKHALEEJ a wide range of opportunities to fund ● MORGAN STANLEY AIP ● APOLLO MANAGEMENT PRIVATE EQUITY Private Equity & Venture Capital Summit ● ATA INVEST ● NBD SANA managers, and we asked investors what ● AUREOS CAPITAL ● NBK CAPITAL ● BARCLAYS CAPITAL ● NEW ENERGY FINANCE Winning Strategies For Securing Quality Deal Flow, Creating Value types of funds they felt were particularly ● BC PARTNERS ● NOMAD CAPITAL And Maximising Returns In Rapidly Transforming Markets ● CAPITAL DYNAMICS ● NORTHERN GULF PARTNERS attractive in the current climate. As ● CAPITAL TRUST ● PANTHEON VENTURES ● CELERANT Join Regional Investors & Global Thought-Leaders CONSULTING ● PARTNERS GROUP illustrated by Fig. 4, approximately a third ● CI CAPITAL HOLDING ● PCGI HE Abdallah Guy Hands, Chairman, David Rubenstein ● CITADEL CAPITAL ● PORTFOLIO ADVISORS Al-Moualimi Chairman Chief Investment Officer and Founder Co-Founder & Managing Director of investors believe small to mid-market ● CLEARSIGHT ● PREQIN HBG HOLDINGS TERRA FIRMA THE CARLYLE GROUP INVESTMENTS ● PROVIDENCE EQUITY ● CLIMATE CHANGE PARTNERS Ammar AlKhudairy, Board Member, Ahmed Heikal Steve Schwarzman Chairman buyout funds are particularly appealing. CAPITAL ● RASMALA Chief Executive Officer & Managing Chairman & Founder CEO & Co-Founder ● CORECAP INVESTMENTS Director, AMWAL ALKHALEEJ CITADEL CAPITAL THE BLACKSTONE GROUP 31% of investors told us that distressed ● CVC ● RHO FUND INVESTORS ● DELOITTE ● RIGA GRADUATE SCHOOL OF LAW Charles Baillie, Global Co-Head Alan Jones, Managing Director & George Siguler, Managing Director & ● DELTA PARTNERS private equity, including distressed debt, ● SHUAA PARTNERS Alternative Investments and Manager Co-Head, MORGAN STANLEY PRIVATE Founding Partner, SIGULER GUFF ● DUBAI INTERNATIONAL CAPITAL ● SIGULER GUFF Selection (AIMS), GOLDMAN SACHS EQUITY turnaround and other special situations ● EMERGING CAPITAL ● SIRAJ CAPITAL David Smoot, CEO, Private Equity, PARTNERS ● SJ BERWIN Steven Costabile, Managing Director, Jon Moulton, Managing Partner DUBAI INTERNATIONAL CAPITAL ● FOURSAN GROUP ● Head of Private Equity Funds Group ALCHEMY PARTNERS funds, are especially attractive at present. SOCIETE GENERATE ● GOLDMAN SACHS ASSET MANAGEMENT AIG INVESTMENTS Nabil Triki, Managing Director, ● ALTERNATIVE Jonathan Nelson Private Equity, SWICORP GREENPARK CAPITAL INVESTMENTS Secondaries funds have continued to ● GROWTHGATE CAPITAL ● STANFORD UNIVERSITY Ambassador Ford Fraker CEO & Founder ● Ivan Vercoutere, Managing Partner GULF CAPITAL ● STRATEGIC VALUE Senior Advisor PROVIDENCE EQUITY PARTNERS draw signiﬁ cant investor interest. 14% ● GVCA PARTNERS KOHLBERG KRAVIS ROBERTS LGT CAPITAL PARTNERS ● HAMILTON LANE ● SWICORP of LPs found other areas of the market ● HARVARD BUSINESS ● TERRA FIRMA Principal Sponsors: SCHOOL ● THARWA Co-Sponsors: ● HBG HOLDINGS MANAGEMENT attractive, including cleantech funds and CONSULTANCY ● HELLMAN & FRIEDMAN ● ● THE BLACKSTONE HSBC PRIVATE EQUITY GROUP vehicles targeting emerging markets. ● IFC ● THE CARLYLE GROUP ● INVEST AD ● THE NATIONAL ● IS PRIVATE EQUITY INVESTOR Principal Legal Sponsor: Media Partners: ● ITHMAR CAPITAL ● THE WELLCOME TRUST With many investors currently ● JADWA INVESTMENT ● TSING CAPITAL ● JARIR GROUP ● UAT & CO NEXIA INTERNATIONAL Principal Advisory Services Sponsor: Endorsed by: approaching private equity investments ● KOHLBERG KRAVIS ROBERTS ● VINSON & ELKINS Official Arabic Investment Community Broadcaster Partner: ● KULCZYK INVESTMENT ● WELSH, CARSON, with a greater degree of caution than HOUSE ANDERSON & STOWE ● Z CAPITAL they have in the past, what are the

Feature Article: Current Investor Attitudes to Private Equity

prospects for managers seeking to establish new relationships with LPs? Fig. 5: We asked investors whether they would consider investing with GPs with which they do not already have a relationship Proportion of Investors Intending to Invest in Next 12 Months That Will Consider Forging in the next 12 months. As Fig. 5 shows, New Relationships With GPs For These Investments 64% of investors will consider forming new relationships with GPs, compared to just 25% that will only be looking to re-up with existing managers in their portfolios. Although this is encouraging evidence for GPs, many investors stated that a GP they had not invested with before would have to present them with an especially compelling opportunity for them to consider investing.

The Challenge for Fund Managers

Although investor appetite for private equity has taken a knock following the market downturn, most investors recognise the long-term nature of the asset class and intend to remain in it over the longer term. For fund managers seeking fresh commitments in the year Hear from the Following ahead, however, the evidence is clear: Industry Leaders: investors will be returning to the market is pleased to announce NEW ORLEANS EMPLOYEES RETIREMENT SYSTEM but will be more cautious and invest at CITY OF RICHMOND RETIREMENT SYSTEM a slower rate than they have in the past. WORLD BANK PENSION FUND THE ROTTER FAMILY TRUST At the same time, more than 1,600 funds MASMASSACHUSETTS INSTITUTE OF TECHNOLOGY are on the road seeking capital, close to ANNUAL HERHERMES REAL ESTATE INVESTMENT MANAGEMENT record-breaking levels. The challenge, INTEINTERNATIONAL FINANCE CORPORATION INSTITUTIONAL AAMERICAME 2050 therefore, for fund managers seeking to THE PHILADELPHIA FOUNDATION raise capital in the coming year will be to INVESTOR SUMMIT VERVERIS WEALTH PARTNERS stand out from all their competitors and EDWEDWARD HAZEN FOUNDATION Benchmark the Latest Industry Trends and to effectively promote their vehicles to the CHANNEL CAPITAL GROUP Network with Top-Qualiﬁed Institutional Investors KENMAR GLOBAL INVESTMENT most appropriate audience. CFA INSTITUTE BP AMERICA TRUST INVESTMENTS There are many ways in which fund MERRYL LYNCH CONSULTING INSTITUTE FOR ELECTRICAL & ELECTRONIC ENGINEERING managers can improve their chances September 15th, 2009 NEW YORK CITY COMPTROLLER’S OFFICE of a successful fundraise. Many LPs ALEXANDER DAWSON FOUNDATION have informed us that they expect to see New York PARADIGM CONSULTING SERVICES, LLC greater transparency from prospective ROPES & GRAY LLP AND MANY MORE! GPs and therefore it is essential that managers make sure that all fund documentation is prepared prior to hitting the road. GPs should also be prepared Visit us at www.iglobalforum.com for the fundraising process to take longer than in previous years, with funds that

Feature Article: Current Investor Attitudes to Private Equity

reached a ﬁ nal close so far in 2009 taking ToT see the full 10-page report on current investor attitudes, please visit: a record-breaking average of 18.3 months to raise their capital. www.preqin.com/investorsurvey Managers that expect to enter the fundraising market in 2010 with their next Preqin’s Investor Intelligence database is a vital tool for all professionals vehicles should make sure to remain involved in the capital raising process for private equity funds. It contains in regular contact with their existing up-to-date profi les for more than 4,000 investors in private equity, investors this year to put them in the best including key information on investment preferences, investment plans position when approaching them about both for the next 12 months and over the longer term, and key contact fresh commitments next year. information for appropriate personnel at each institution.

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The Preqin Performance Benchmarks module off ers comprehensive benchmarking tools for the private equity industry. The benchmarks are calculated using performance returns for over 4,500 funds from our Performance Analyst database, the world's most extensive and transparent database of private equity and venture capital fund performance. In terms of aggregate value, this represents around 70% of all capital ever raised.

This high level of coverage enables us to produce the most meaningful benchmarking and comparative tools available in the industry. Key features of the Preqin Performance Benchmarks module include:

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Performance Spotlight: The Eff ect of Private Equity Performance on the Current Fundraising Environment

After ﬁ ve years of consistent growth, total fundraising fell slightly in 2008, before Fig. 1: falling back to 2005 levels in the ﬁ rst half of 2009. In this month’s Performance Spotlight we examine the impact of fund Aggregate Capital Raised by Year performance on the fundraising market.

The primary cause of the slowdown is the denominator effect. Investors have found that their private equity allocations have increased as a result of other areas of their portfolios reducing in value disproportionately to private equity. Although it has been affected by the current economic crisis, private equity has suffered to a lesser extent than listed equity. As a result, compared to public indices, private equity is generating better Aggregate Capital Raised ($bn) returns. As of December 31st, 2008, the one-year returns for the Standard & Poor’s 500, MSCI Europe and MSCI Emerging Markets were -37.0%, -46.4% and -53.2% respectively, compared Year with -27.6% for private equity. Horizon IRRs for private equity are also beating ﬁ ve-year periods. As a result, many Public Employees’ Retirement System, the public indices over the three- and institutional investors, including California Florida State Board of Administration and Montana Board of Investments, had to amend their asset allocation policies to Fig. 2: accommodate their existing exposure to private equity partnerships. Already being overallocated to private equity Amount Called and Distributed Annually for Buyout Funds has therefore kept these investors from investing in new partnerships.

Another important factor is that investors are not receiving much in the way of distributions from funds in their portfolios. This becomes evident when analysing the cash ﬂ ow of buyout funds. As Fig. 2 shows, between 2004 and 2006, the buyout industry was distributing much more capital than it was investing, despite the fact that fundraising and deal activity were both growing rapidly at the time. 2007 saw Yearly Called / Distributed ($ bn) Yearly the largest amount of capital ever was distributed.

Year The current crisis has seen both distributions and investments slow and

Performance Spotlight: The Eff ect of Private Equity Performance on the Current Fundraising Environment

in 2008, the buyout industry called up of funds on the road has fallen, but not less than $150 billion and distributed $63 signiﬁ cantly, and so competition amongst Much of the data used in this billion back to investors. This meant that these funds is more intense than ever research has been taken from LPs were putting 2.35 times more into before and GPs will need to use the best Preqin’s Performance Analyst buyout funds than they were receiving intelligence available to attract LPs. database. Please contact us if you back from them. This imbalance between would like further information on contributions and distributions left LPs Preqin can help with fundraising, providing this, or to arrange a trial access with little or no cash to reinvest back into comprehensive performance benchmarks, to see how you can benefi t from the asset class. detailed proﬁ les of potential investors and the database. In addition, Preqin’s in-depth data on fundraising competition. Performance Benchmarks are now As a result, the level of capital available available free of charge. to invest in new private equity funds has Etienne Paresys fallen, and many investors are currently not able to invest at all. Those that are investing will be committing less capital than in previous years in order to meet revised target allocations.

With less capital available to invest in new vehicles, investors are paying especially close attention to both the individual track record of managers with funds in market and the historical performance and risk/ return statistics of fund types. The number

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Fund Manager Spotlight: New York Buyout Firms

New York is both a global and US focused centre of ﬁ nance and Fig. 1: business. Subsequently it should come as no surprise that many of the world’s largest buyout players were set-up and Buyout Funds Raised/Raising by New York Buyout Firms are headquartered in New York.

Fundraising by New York-Based Firms

Fundraising by buyout ﬁ rms based in New York has been very strong in recent years, boosted by a number of mega-sized funds from managers including Blackstone, KKR, Apollo, Carlyle and Goldman Sachs. 2007 represented the peak for fundraising by ﬁ rms in New York City, with in Yearly Called / Distributed ($ bn) Yearly excess of $75bn being raised.

Things have slowed down considerably since then, with 2008 seeing $46bn in aggregate commitments, and $21bn in 2009 (as of July). Please see Fig. 1 to Blackstone’s Capital Partners V fund is Industry Focus the right for more details. the largest, achieving a fi nal close on over $21bn. Apollo is the only fi rm to Buyout fi rms have always invested in Largest Funds Raised have raised two funds exceeding $10bn what are known as “traditional” industries in committed capital. Goldman Sachs, where, with the right management Fig. 2 below shows the largest funds to Apollo and Carlyle all have two funds in place, operational improvements be raised by fi rms headquartered in New appearing in the top 10. can be achieved. Preqin supports this York. argument given that from our analysis,

Fig. 2:

Biggest Funds Raised by NYC Headquartered Buyout Firms (Non US focused funds excluded) Fund Manager Size (mn) Year Raised Blackstone Capital Partners V Blackstone Group 21,700.0 USD 2006 GS Capital Partners VI Goldman Sachs 20,300.0 USD 2007 KKR Fund 2006 Kohlberg Kravis Roberts 17,642.0 USD 2007 Apollo Investment Fund VII Apollo Management 14,800.0 USD 2008 Carlyle Partners V Carlyle Group 13,700.0 USD 2008 Apollo Investment Fund VI Apollo Management 10,160.0 USD 2006 Silver Lake Partners III Silver Lake 9,300.0 USD 2007 GS Capital Partners V Goldman Sachs 8,500.0 USD 2005 Carlyle Partners IV Carlyle Group 7,850.0 USD 2005 JC Flowers II JC Flowers & Co 7,000.0 USD 2007

comprehensive, detailed source of Fig. 3: information on private equity fund managers available today. Preqin’s team of dedicated analysts are Industry Preferences for New York Buyout Firms continually monitoring, researching and contacting managers of all different types from around the globe in order to ensure that the data we hold is up to date, reliable and complete.

This powerful database includes

Percentage of Firms detailed proﬁ les for over 4,600 managers including 15,000 individual contacts with direct contact info. For more information on the many features of this vital product, please visit:

www.preqin.com/fmp

Manuel Carvalho

59% of the New York City-based interest in while 1% prefer a minority buyout fi rms will invest in the industrials shareholding position. (Fig. 4) sector. This includes sub-sectors such as manufacturing, engineering and Data Source: Fund Manager Profi les transportation. Similarly 58% of New York City buyout fi rms will invest in business Fund Manager Profi les is the most services and 56% will invest in consumer discretionary sub-sectors such as retail and consumer products. (Fig.3) Fig. 4:

Board Representation Shareholding Preferences for New York Buyout Firms When acquiring a company, 83% of the New York City-based buyout ﬁ rms require a board seat on that company, while 16% only would prefer to have a board seat on that company. Only 1% of New York City-based buyout ﬁ rms do not require a board seat.

Shareholding

When it comes to shareholding, 41% of New York City-based fi rms require a controlling interest in the company, while 33% prefer a controlling interest in the company. 20% of the fi rms have no preference on the shareholding of the companies they acquire. Only 5% require a minority position in a fi rm they have

New to Fund Manager Profi les - Dry Powder. View historical dry powder across the private equity industry for all private equity fund types and geographic regions. This feature includes in-depth analysis and a comprehensive breakdown of dry powder available historically across buyout, venture, mezzanine, distressed private equity and other fund types.

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Fundraising Spotlight: Buyout

Buyout Funds on the Road Final Close Barometer

Funds on the Road US Europe ROW Total No. of Funds 122 59 76 257 Aggregate Target 126 37 44 207 Size ($bn) Average Size 1,032 627 579 746 ($mn)

Buyout Funds on the Road

Fund Manager Size (mn) GP Location Blackstone Capital Partners VI Blackstone Group 15,000.0 USD US Hellman & Friedman VII Hellman & Friedman 10,000.0 USD US KKR Fund 2009 Kohlberg Kravis Roberts 8,000.0 USD US Candover 2008 Candover Partners 5,000.0 EUR UK Madison Dearborn Capital Partners VI Madison Dearborn Partners 7,500.0 USD US Morgan Stanley Capital Partners V Morgan Stanley Private Equity 6,000.0 USD US Clayton Dubilier & Rice VIII Clayton Dubilier & Rice 6,000.0 USD US FourWinds Capital II FourWinds Capital 3,000.0 EUR UK Abraaj Buyout Fund IV Abraaj Capital 4,000.0 USD United Arab Emirates Onex Partners III Onex Corporation 4,000.0 USD Canada

Recently Closed Buyout Funds

TA XI Industry Focus: Any Manager: TA Associates Lawyer: Cleary Gottlieb Target Size (mn): 3,500 USD Placement Agent: Citi Alternatives Distribution Group Closings (mn): First Close: 2,830 USD (Apr-2009), Final Close: 4,000 Sample Investors: Asia Alternatives Management, Indiana Public USD (Jul-2009) Employees’ Retirement Fund, Ontario Teachers’ Pension Plan Geographic Focus: U S Industry Focus: Any Huntsman Gay Capital Partners Placement Agent: UBS Investment Bank Private Funds Group Manager: H&G Capital Partners Sample Investors: Abbott Capital Management, Florida PRIME, Los Target Size (mn): 1,000 USD Angeles City Employees’ Retirement System, Los Angeles County Closings (mn): Final Close: 1,100 USD (Jul-2009) Employees’ Retirement Association, Massachusetts Pension Reserves Geographic Focus: US Investment Management Board, Montana Board of Investments, San Industry Focus: Technology, Healthcare, Consumer Products, Francisco City & County Employees’ Retirement System, State of Industrial, Manufacturing, Financial Services, Chemicals, Education / Connecticut Retirement Plans and Trust Funds, Virginia Retirement Training, Infrastructure, Business Services System, Washington State Investment Board Sample Investors: AlpInvest Partners, C.V. Starr & Co, California Public Employees’ Retirement System (CalPERS), California State Teachers’ MBK Partners II Retirement System, New York State Common Retirement Fund Manager: MBK Partners Target Size (mn): 2,500 USD Closings (mn): Final Close: 1,600 USD (Jul-2009) Geographic Focus: China, Hong Kong, Japan, South Korea, Taiwan, North Korea

Fundraising Spotlight: Venture

Venture Funds on the Road Final Close Barometer

Funds on the Road US Europe ROW Total

No. of Funds 202 91 181 474

Aggregate Target 41 18 33 92 Size ($bn) Average Size ($mn) 203 198 182 194

Venture Funds on the Road

Fund Manager Size (mn) GP Location Cyrte Investments TMT Fund Cyrte Investments 3,000.0 EUR Netherlands New Enterprise Associates XIII New Enterprise Associates 2,500.0 USD US Invention Investment Fund II Intellectual Ventures 2,500.0 USD US China-Singapore Hi-tech Industrial China-Singapore Suzhou Industrial Park 1,330.0 USD China Investment Fund Riverwood Capital I Riverwood Capital 1,250.0 USD US Millennium Private Equity Media & Millennium Private Equity 1,000.0 USD United Arab Emirates Telecommunication Hudson Clean Energy Partners Hudson Clean Energy Partners 1,000.0 USD US Khosla Ventures Expansion Fund Khosla Ventures 1,000.0 USD US New Horizon Capital Fund III New Horizon Capital 1,000.0 USD China ECP Africa Fund III Emerging Capital Partners 1,000.0 USD US

Recently Closed Venture Funds

Evolution One Fund Industry Focus: Technology, Retail, Distribution, Consumer Services, Manager: Inspired Evolution Investment Management Financial Services, Software, Internet, Business Services, Digital Media, Fund Type: Venture (General) Wireless, IT Security Target Size (mn): 1000 ZAR Sample Investors: Fort Washington Capital Partners, Hartford Closings (mn): First Close: 400 ZAR (Jul-2008); Final Close: 800 USD Investment Management, NB Alternatives, Partners Group, TIAA-CREF (Jun-2009) Geographic Focus: Namibia, South Africa, Botswana, Zambia, Excel Medical Fund Mozambique Manager: Excel Venture Management Industry Focus: Clean Technology, Renewable Energy Fund Type: Venture (General) Lawyer: Edward Nathan Sonnenbergs Target Size (mn): 200 USD Sample Investors: African Development Bank, Castleway, Consensus Closings (mn): First Close: 100 USD (Feb-2008); Final Close: 125 Business Group, Finnfund, IFCI, International Finance Corporation USD (Jul-2009) (IFC), Swiss Investment Fund for Emerging Markets (SIFEM), Geographic Focus: US Industry Focus: Pharmaceuticals, Healthcare, Life Sciences, GRP III Biotechnology, Agriculture, Chemicals, Energy, Medical Instruments, Manager: GRP Partners Defence, Medical Devices, Medical Technologies, Healthcare IT Fund Type: Venture (General) Placement Agents: Ariane Capital Partners Target Size (mn): 300 USD Closings (mn): Final Close: 192 USD (Jun-2009) Geographic Focus: Europe, North America Benjamin Formela-Osborne

Fundraising Spotlight: Funds of Funds

Funds of Funds on the Road Final Close Barometer

Funds on the Road US Europe ROW Total

No.of Funds 82 72 11 165 Aggregate Target 29 19 3 52 Size ($bn) Average Size ($mn) 356 270 290 314

Funds of Funds on the Road

Fund Manager Size (mn) GP Location Fund Focus HarbourVest International VI Partnership HarbourVest Partners 3,000.0 USD US US AXA Capital Europe AXA Private Equity 1,500.0 EUR Europe Europe Fortune US Fund of Funds Fortune Management 2,000.0 USD Europe US GS Distressed Opportunities Fund IV Goldman Sachs Private Equity Group 1,750.0 USD US US JP Morgan US Corporate Finance IV JPMorgan Asset Management 1,500.0 USD Europe US JPMorgan Venture Capital Investors IV JPMorgan Asset Management 1,500.0 USD Europe US GS Private Equity Partners IX Goldman Sachs Private Equity Group 1,500.0 USD US US Adams Street US Partnership 2009 Adams Street Partners 1,260.0 USD US US AXA Capital America AXA Private Equity 1,000.0 USD Europe US Horsley Bridge International IV Horsley Bridge Partners 1,000.0 USD US US

Recently Closed Funds of Funds

Fort Washington Private Equity Investors VI BlackRock Diversiﬁ ed Private Equity Program IV Manager: Fort Washington Capital Partners Manager: BlackRock Alternative Advisors Target Size (mn): 250.0 USD Target Size (mn): 1,000.0 USD Final Close (mn): 170 USD Final Close (mn): 790 USD Geographic Focus: North America, Europe, Asia Geographic Focus: US, North America, Europe Industry Focus: Technology, Healthcare, Industrial, Media, Business Industry Focus: Any Services Macquarie Alternative Investment Trust V Danske-Private Equity IV Manager: Macquarie Funds Group Manager: Danske Private Equity Target Size (mn): 400.0 AUD Target Size (mn): 600.0 EUR Final Close (mn): 167 AUD Final Close (mn): 605 EUR Geographic Focus: Australia, New Zealand Geographic Focus: North America, Europe Industry Focus: Any Industry Focus: Any Hanna Ohlsson

Preqin’s Secondary Market Monitor

For a free and confi dential indicative valuation of all or part of your private equity holdings visit:

www.preqin.com/secondarymonitor

London: +44 (0)20 7065 5100 New York: +1 212 808 3008 Email: [email protected] Web: www.preqin.com 18 ◄ Conferences Spotlight August 2009

Conferences Spotlight: Forthcoming Events

Featured Conferences:

Annual Institutional Investor Global Distressed Debt Summit Investing

Date: September 15th, 2009 Date: September 22nd-23rd, 2009 Location: Embassy Suites Hotel, New York Location: Park Central Hotel, New York Organiser: iGlobal Forum Organiser: iGlobal Forum

Global economic crisis hasn’t spared anyone. Available funding Global economic crisis hasn’t spared anyone. Available funding is drying up and companies in virtually all sectors are struggling is drying up and companies in virtually all sectors are struggling to remain afl oat. List of businesses in distress is growing to remain afl oat. List of businesses in distress is growing longer by the minute. Even the most successful companies fi nd longer by the minute. Even the most successful companies fi nd themselves facing distressed situations, opening another window of themselves facing distressed situations, opening another window of opportunities for investing in distressed debt across the globe. opportunities for investing in distressed debt across the globe. The event will unite Distressed Fund Managers, Private Equity Fund The event will unite Distressed Fund Managers, Private Equity Fund Managers, Hedge Fund Managers, M&A and Turnaround Advisors, Managers, Hedge Fund Managers, M&A and Turnaround Advisors, Investment Bankers, Bankruptcy Advisors, Loan Originators, Debt Investment Bankers, Bankruptcy Advisors, Loan Originators, Debt Providers, and Rating Agencies. Providers, and Rating Agencies.

Information: www.iglobalforum.com/iisummitg Information: www.iglobalforum.com

Private Equity Tax Practices New Do’s & Don’ts of Fundraising

Date: October 1st, 2009 Date: October 7th, 2009 Location: Le Meridien Piccadilly Hotel, London Location: University Club, New York City Organiser: IBC Organiser: The Capital Roundtable

This conference will once again provide a platform for the leading Designed to Meet the Needs of GPs, LPs, & Managers of Buyout, experts on private equity taxation to discuss the latest tax schemes, Growth Equity, & Mezzanine Funds, As Well as Ofﬁ cers & structures and options for minimising excessive tax exposure. Directors of Their Portfolio Companies, Independent Sponsors, The programme will cover the full range of private equity tax and Investment Bankers, Lenders, Industry Executives, lawyers, & practices from structuring your fund, management set-up, to your investments themselves. Other Advisors Who Work With Them. QUOTE VIP CODE: KW5072PQWB Information: http://www.capitalroundtable.com/masterclass/ Information: http://www.iir-events.com/IIR-Conf/page. mc_2009-10-07.html aspx?id=21221

Conferences Spotlight: Forthcoming Events

SuperReturn Middle East Private Equity World Africa

Date: 11th-14th October, 2009 Date: 26th-29th October, 2009 Location: Grand Hyatt, Dubai Location: Sandton Convention Centre, Johannesburg Organiser: ICBI Organiser: Terrapinn

Given unprecedented global uncertainty, the international and MENA region private equity market is facing challenges. The time has never been better for industry leaders across the The most widely-praised private equity event brings you supreme continent to get together and discuss the changes and challenges insights to clarify the road ahead. You will beneﬁ t from the brain facing this asset class. Private Equity World Africa 2009 brings you power of the cream of global industry heavyweights and share this insight at the Sandton Convention Centre, Johannesburg from insights from regional leading companies. 26 - 29 October 2009. Don’t miss the greatest opportunity to learn and implement industry best practice. Information: www.superreturnme.com Information: www.terrapinn.com/2009/peza

Other Conferences:

CONFERENCE/EVENT DATES LOCATION ORGANISER 2009 Investment Forum for Endowments, Foundations and Pension September 2009 (tbc) New York Argyle Executive Forum Funds Capital Creation 2009 15 - 17 September Monte Carlo Worldwide Business 2009 Research FundForum Latin America 15 - 17 September Sao Paulo ICBI 2009 Annual Institutional Investor Summit 15 September 2009 New York iGlobal Succeeding at Fundraising 16 September 2009 New York Capital Roundtable SuperReturn Asia 21 - 24 September Hong Kong ICBI 2009 9th MedTech Investing Europe Conference 28 - 29 September London Campden Conferences 2009 SuperReturn Middle East 11 - 14 October 2009 Dubai ICBI EVCA Venture Capital Forum 14 - 16 October 2009 Berlin EVCA Emerging Managers Summit South 15 - 16 October 2009 San Antonio Opal Financial Group European Alternative & Institutional Investing Summit 19 - 21 October 2009 Monte Carlo Opal Financial Group FundForum Middle East 19 - 22 October 2009 Bahrain ICBI European Leveraged Finance Conference 21 October 2009 London SIFMA Private Equity World Africa 2009 26 - 29 October 2009 Johannesburg Terrapinn The Emerging Markets Private Equity Forum 2009 3 - 4 November 2009 London PEI Media 14th CEE Private Equity Forum 5 - 6 November 2009 London C5 9th Annual Super Investor 17 - 20 November Paris ICBI 2009

Investor Spotlight: LP News

Secondaries News:

Korea Investment Corporation (KIC) has awarded a private AMG National Trust Bank plans on committing USD 10-20 equity secondary mandate to Partners Group. million to private equity over the next 12-18 months. The secondary market is currently offering substantial discounts to The USD 2.5 billion asset manager plans on committing this capital net asset value and attractive return potential, something which the to between three and fi ve private equity vehicles. AMG National USD 30 billion sovereign wealth fund hopes to profi t from. Partners Trust Bank is a relatively active investor in private equity. It invests Group expects the mandate to further strengthen its position within in a number of fund types, including buyout and venture vehicles. the Asian private equity market. Geographically, it predominantly invests in funds focusing on North America, Europe and Latin America. Adams Street Global Opportunities Secondary Fund II has reached a fi rst close on USD 235 million. Chuo Mitsui Trust and Banking Company plans to commit to The dedicated secondaries fund has a fundraising target of USD three or four private equity funds over the next 12 months. 600 million and will focus on purchasing fund interests on a global The Japanese investor plans on committing between USD 50 basis. Investors in the fund include Chicago Firemen’s Annuity & million and USD 100 million to these funds. Chuo Mitsui Trust and Benefi t Fund, which pledged USD 7.5 million. Banking Company is an active investor in private equity and has been investing in the asset class for a number of years. It has Paul Capital Partners has made further appointments to its a preference for committing to mezzanine, buyout and fund of secondary market investment team. funds vehicles. It predominantly looks to invest in funds focusing The secondary fund of funds manager has made the appointments on Japan, the US, Europe and Asia. However, it will not consider in response to the increased global demand for secondary market investing in Russia, the Middle East or Africa. exposure. Among those hired include: San Francisco-based analyst, Jennifer Chang; New York-based analyst, Josh Platek; Ecolab Pension Plan has set its maiden allocation to private Paris-based analyst, Marion Peiridier. equity. The USD 650 million pension plan will allocate 5% of its total assets to private equity over the next year in order to gain its initial exposure to the asset class. The pension plan, based in St. Paul, Private Equity News: Missouri, is aiming to split its USD 32.5 million allocation equally between three funds. The pension plan has already earmarked the School Employees’ Retirement System of Ohio (Ohio specifi c funds, all of which are managed by JPMorgan. The portfolio SERS) plans to commit up to USD 250 million in the next 12 will include venture capital and secondary market investments. months. The USD 8.1 billion retirement system intends to make commitments ERA Foundation is intending to treble its allocation to private to private equity funds of USD 150–250 million before the end of equity. June 2010. While its primary focus will be on domestic buyout The foundation currently has 25% of its GBP 20 million in total funds, Ohio SERS is also seeking special situations, distressed assets invested in private equity. It is looking to raise this fi gure debt and energy funds, as well as international and co-investment to 75% over the longer term. It will be making two or three opportunities. The system, which aims to commit 10% of total commitments over the next 12 months, and will allocate GBP 1-3 assets to private equity, pledged nearly USD 200 million to the million to each investment. asset class between July 2008 and June 2009. Oppenheimer Alternative Investment Management plans on Jade Invest was an investor in the recently-closed, Keytone making 5-10 fund investments over the coming 12 months. Ventures China Fund. The fund of funds manager is currently fundraising for its latest The private equity fund of funds manager has committed to vehicle, Oppenheimer Global Resource Private Equity Fund I, Keytone Ventures’ fi rst vehicle, Keytone Ventures China Fund. In which it hopes will reach a fi nal close by the end of 2009. The fund June 2009 Jade Invest announced that it was looking to invest in hopes to close with USD 300 million in commitments and will invest four or fi ve new private equity vehicles over the subsequent 12 in private equity funds targeting natural resources and energy months. Keytone Ventures China Fund is targeting growth-stage sectors globally. The fund of funds will look to invest between USD investments in the technology, media, consumer product and 7 million and USD 15 million in each fund. cleantech sectors and closed recently on USD 200 million. Kerry Pogue

Each month Spotlight provides a selection of the recent news on institutional investors in private equity. More news and updates are available online for Investor Intelligence and Secondary Market Monitor subscribers. Contact us for more information - [email protected]