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PE-backed exits break quarterly record… again

Preqin’s exit data shows that there have been 201 PE-backed exits valued at USD85bn in Q2 2011 to date. This is 5% higher than the record level reached in Q4 2010 when 325 exits with an aggregate value of USD81.3bn were announced. Deals have been particularly prevalent in Europe, with 82 exits valued at USD57.9bn taking place so far this quarter, double the USD28.6bn seen in the previous quarter.


The largest PE buyout-backed exit announced in Q2 2011 to date is the acquisition of Nycomed by Takeda Pharmaceutical Company in a EUR9.6bn deal; sellers include Nordic Capital, DLJ Merchant Banking Partners (Credit Suisse) and Avista Capital Partners.

The USD85bn in aggregate exit value already announced in Q2 2011 is 10% higher than the total USD77.3bn in exits completed in Q1 2011.  Half of the 10 largest exits announced so far in Q2 2011 are realizations of deals made during the buyout boom-era of 2005-2007, and three deals represent realizations of deals made within the last two years.  European exit value has reached USD57.9bn, double that of Q1 2011 and almost five times the USD12.7bn in exits seen during the same quarter in 2010.

North American exits currently stand at USD23.7bn, and look set to remain at similar levels to previous quarters; there were over USD43bn in exits in both Q4 2010 and Q1 2011.  Asia and Rest of World exit value is likely to match the USD5.2bn of Q1 2011; there have been USD3.4bn worth in Q2 2011 to date.  Asia and Rest of World exits have declined since they reached a record USD14.1bn in Q4 2010. Almost half of the exit value in Q2 2011 to date has been in the industrials (23%) and healthcare sectors (22%).  The technology sector accounts for one fifth of exits and 15% of exit value. The consumer and retail sector represents 17% of the number and 12% of the value of exits in Q2 2011 to date.  The materials sector accounts for 4% of the number of exits, but 14% of total exit value, largely due to Glencore’s £6.8bn IPO.

There have been 380 buyouts announced globally in Q2 2011 to date, valued at USD43.3bn, indicating that the current value of deal flow is likely to near the post-Lehman high of USD67.3bn announced in Q4 2010, while remaining well below the all-time peak of USD369.5bn from the boom-era in Q2 2007.

‘In recent quarters we have witnessed a surge in exit activity. Exit values are at record levels as fund managers take advantage of current market conditions to exit investments made both during the buyout boom-era and post-financial crisis," says Manuel Carvalho, Manager – Private Equity Deals. "While buyout deal flow as a whole has rebounded from the lows seen in 2009, entry deal flow is still a long way from the highs seen in 2006 and 2007, with exits accounting for the largest proportion of fund manager activity. However, the increase in exit activity looks set to ease the difficult fundraising conditions; capital is increasingly being returned to investors, and this will be committed to new funds if investors intend to maintain their current allocation levels."

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