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December 11, 2012 Private Company Financial Intelligence Copyright © 2012 PrivCo Media LLC. All Rights Reserved. U.S. Private Market M&A Overview (<$500M)

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Presentation on theme: "December 11, 2012 Private Company Financial Intelligence Copyright © 2012 PrivCo Media LLC. All Rights Reserved. U.S. Private Market M&A Overview (<$500M)"— Presentation transcript:

1 December 11, 2012 Private Company Financial Intelligence Copyright © 2012 PrivCo Media LLC. All Rights Reserved. U.S. Private Market M&A Overview (<$500M)

2 Speaker Background Sam Hamadeh  PrivCo’s Founder and CEO  Founded and sold the online job and career information leader Vault.com  MBA in Finance from Wharton and a JD from the University of Pennsylvania Law School  Extensive background in finance and private company research with experience at Morgan Stanley and Goldman Sachs Copyright © 2012 PrivCo Media LLC. All Rights Reserved.

3 PrivCo: The Leader in Private Company Financial Intelligence  PrivCo is the first and only provider of financial and business data on major privately held companies.  PrivCo provides detailed financial and business data on over 128,000 major private companies – and over 43,000 private market deals - in a single searchable source.  Data on private company investors, M&A deals, VC funding, and more.  PrivCo acts as a Bloomberg for major private companies. Copyright © 2012 PrivCo Media LLC. All Rights Reserved.

4 M&A Activity Declines In 2012 According to PrivCo data, U.S. private company middle market M&A totaled $37.5 Billion in Q3 2012, down 21% from Q Similarly, deal volume fell 16% from 3,290 in Q3 2011, to 2,764 in Q For the Q3 last twelve months (LTM), private middle market M&A totaled $144 Billion, down 16% from $167 billion for LTM Q3 2011

5 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. M&A Activity Declines In 2012 (Cont.) After what seemed to be recovery in 2010 & 2011, 2012 has proven to be a fragile marketplace given the drop in deal volume and transaction value

6 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Top Corporate Buyers (Deal Value <$500M)

7 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. TargetAcquirorDeal PriceEV/Rev Hyper Marketing Inc.Alliance Data Systems$460,000,0001.5x Fleet One, LLCWright Express Corp.$369,000,0006.6x BytemobileCitrix Systems$435,000, PowerReviews, Inc.Bazaarvoice, Inc.$151,900, x Airborne Health, Inc Schiff Nutrition International, Inc $150,000,0001.3x Demandforce, Inc.Intuit, Inc.$423,500, x ID AnalyticsLifelock$185,970,0006.5x Select Strategic Buyer Transactions (2012)

8 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Middle Market private equity activity as a percentage of total volume has steadily increased over the past 3 years, with a greater percentage of 2012’s deals being sponsor backed, despite the slow down in transaction value Financial Buyer (Deal Value <$500M)

9 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Top Financial Buyers (Deal Value <$500M)

10 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. TargetAcquirorDeal PriceEV/Rev Young Innovations, Inc. Linden Capital Partners$314,000,0003.0x Oriental Trading Company, Inc. Berkshire Hathaway Inc$500,000,0001.0x Dick Clark Productions Guggenheim Partners Mandalay Sports Ent. Mosaic Media Group $370,000,000N/A Intelligrated, Inc.Permira Advisors$500,000,0001.3x* Fogo de Chao Holdings LLC Thomas H. Lee Partners$400,000,000N/A Sundance HoldingsBrentwood Associates$125,000,0000.8x Benihana Inc.Angelo, Gordon & Co.$296,000,0000.9x Select Financial Buyer Transactions (2012) * Estimated

11 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Average Enterprise Values in 2012 have increased year over year, up over 10% in Q The drop off in value in Q3 reflects global M&A declines, due to macroeconomic uncertainty and market chill ahead of the pending US Elections, in addition to an increase in deals under the $66 million anti-trust threshold Average Enterprise Value of Transactions (Deal Value <$500M)

12 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Top 10 Industries For Private Market Deals RankIndustry 1Software 2Insurance 3Services 4Banking 5Health Care & Related Medical 6Internet Services 7Information Technology 8Social Media 9Advertising & Marketing 10Mobile Applications

13 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Top 10 Geographies For Private Market Deals RankCity 1New York 2San Francisco 3Houston 4Chicago 5Austin 6Atlanta 7Dallas 8Los Angeles 9Seattle 10San Diego

14 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. The Magic $66 Million Threshold In 2012, PrivCo data shows that an increased percentage of private companies are being sold for deal values between $55 and $66 million No HSR Act notification is required if the value of voting securities and assets held as a result of the transaction is below this $66 million threshold PrivCo data also indicates that companies (especially those owned by individuals and families), have been looking to sell by the end of 2012, even at haircut valuations, to avoid the $66 million HSR FTC review and close before 2013’s tax reform

15 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Conclusions Middle market private company transaction value and volume is down in 2012 Private equity funds continue to focus on the middle market, with 2012 showing an increase in transaction value attributed to private equity sales and acquisitions Strategic Buyers will look for lower middle market add-ons, to avoid $66 million HSR FTC review Cautious outlook for 2013 given fiscal cliff negotiations, tax rate increase, European debt crisis and macro instability

16 Copyright © 2012 PrivCo Media LLC. All Rights Reserved. AM&AA 2013 Winter Conference The Middle Market Our World of Opportunity in Winter Conference January , 2013 Hilton Miami Downtown Contact AM&AA for more information MandAconnection.org

17 For a demonstration of the PrivCo private company and deals platform, please contact M&A Client Manager or Copyright © 2012 PrivCo Media LLC. All Rights Reserved. Private Company Financial Intelligence For access to PrivCo’s weekly M&A and Venture Capital newsletter, register for free at To contact Sam Hamadeh directly, For information on the AM&AA, please contact or call


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