Impact of the Financial Crisis Evolution of Private Equity ... · Evolution of New Investments and Exits in EBRD region (by number of transactions) Note: EBRD tracked portfolio only

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© EBRD 2009, all rights reserved

Impact of the Financial CrisisImpact of the Financial Crisis

Evolution of Private Equity Activity Evolution of Private Equity Activity in EBRD Regionin EBRD Region

January 2007 January 2007 -- June 2009June 2009

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Methodology

• This presentation focuses on the impact of the global financial crisis on private equity activity in the EBRD region

• The time horizon spans from January 2007 through June 2009 (30 months)

• Dynamics of key private equity indicators is calculated as an index (assuming 1H 2007 as 100%); percentage changes accompanying graphs reflect period-on-period evolution of an indicator

• Where actual numbers are used for representation, EUR is the base currency

• Calculations are based on fund closing dates, rather than vintage year

• For absolute figures of private equity activity in 2007-2008, please refer to our earlier performance presentations

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EBRD in Private Equity

EBRD’s portfolio of funds: over 15 years of investing in the asset class

119 funds

79 fund managers

EUR 2.52 billion in commitments (USD 3.03 billion) to funds with capital of EUR 12.98 billion (USD 16.22 billion )

Over 1,000 underlying investments, up to 70% exited

Largest PE Fund investment program dedicated to the region*

* EBRD tracked portfolio only, data to June 2009

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EBRD Database

Best available sample of PE performance in central and south east Europe (CSE) and Russia and CIS

Tracks all “gross” investments made by a basket of EBRD invested funds as well as “net” returns to EBRD (“tracked portfolio”)

Measured in EUR Obligatory reporting by fund managers, scrutinised by EBRD

– Reflects comprehensive performance– No “survivor bias” resulting from only best fund managers

reporting

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Fundraising and Investment Trendsfor EBRD tracked portfolio

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Fundraising vs Investments: EBRD Region

Note: EBRD tracked portfolio only

16.3%

5.49%

22.7%

22.4%

11.4%

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

EUR

Mill

ions

0%

5%

10%

15%

20%

25%

30%

Commitments raised by period

Investments in a given period

EBRD commitments as % of total commitments

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Fundraising vs Investments in CSE

24.4%

20%

22.7%

4.6%

16.8%

-

200

400

600

800

1,000

1,200

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

EUR

Mill

ions

0%

5%

10%

15%

20%

25%

30%Commitments raised by period Investments in a given periodEBRD commitments as % of total commitments


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Fundraising vs Investments in Russia/CIS


5.2%

24.5%22.7%

14.2%15.5%

-

200

400

600

800

1,000

1,200

1,400

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

EUR

Mill

ions

0%

5%

10%

15%

20%

25%

30%Commitments raised by period

Investments in a given period

EBRD commitments as % of totalcommitments

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Fundraising by Fund Investment Stage, EBRD Region

Note: based on EUR amount of commitments, EBRD tracked portfolio only

9.0%

84.5%

83.9%

73.5%

15.5%

100.0% 100.0%

7.1%

26.5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

Buyout Growth / Expansion Other

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Fundraising by Fund Investment Type, EBRD Region

Note: based on EUR amount of commitments; EBRD tracked portfolio only

7.5%14.5%

6.0%

4.5%

14.4%

86.8%

71.1%

94.0%88.1%

11.9%2.6%

1.2%

97.4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

Mezzanine Other Venture Capital Private Equity

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New EBRD Commitments by Fund Investment Stage: Regional Perspective, 2007 – 1H 2009


100%

19.5%

53.7%

26.8%

89.5%

10.5%

SEE

Russia/CISCEE

Buyout

Other

Growth / Expansion

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Evolution of New Investments and Exits in EBRD region (by number of transactions)


60

25

45

17

10

239

42

20

0

10

20

30

40

50

60

70

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

Num

ber o

f Tra

nsac

tions

New Investments Exits

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Evolution of New Investments vs Exits(by variation over previous period)

Note: based on EUR amounts; EBRD tracked portfolio only

-72.17%

-28.35%

-64.92%

61.31%

30.97%

-35.48%

0.19%

-64.89%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

Exits New Investments

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Evolution of New Investments: Regional Breakdown (by variation over previous period)


-69.9%

-61.34%

-13.85%

133.32%

-10.31%

-36.79%9.18%

-49.71%

53.45%

-63.03%

608.78%

0%

50%

100%

150%

200%

250%

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

Russia/CIS CEE SEE

-80.72%

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Evolution of Exits: Regional Breakdown(by variation over previous period)


-71.43%

86.3%

-94.54% 37.5%

-72.66%

-95.65%

1392.51%

8.21%

-99.13%

16.06%

0%

50%

100%

150%

200%

250%

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

Russia/CIS CEE SEE

195.52%

-77.42%

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New Investments by Stage (by investment cost)

OtherExpansion Buyout Seed/Start-up/Other early stage

41.18% 50.24%

81.03%

55.28%47.01%

15.64%

0.41%0.69%

3.33%2.34%2.85%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 1H 2009


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New Investments by Sector (by investment cost)

19.73%Services

21.14%TIM

9.94%Consumer,

Wholesale/ Retail

12.62%15.52%17.1%Pharma &Medical

2.33%10.23%4.5%Other

13.83%7.32%Construction

1H 200920082007

41.41%

30.47% 43.89%

20.02%10.27%

19.68%

Note: other sectors include agriculture & forestry, primary & energy, and manufacturing; EBRD tracked portfolio only

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New Investments by Sector(by number of companies)

19.35%Services

17.14%TIM

Consumer,

Wholesale/ Retail

12.9%10.0%9.76%Pharma &Medical

18.57%13.41%Other

7.14%8.54%Construction

1H 200920082007

30.47%

Note: other sectors include agriculture & forestry, primary & energy, and manufacturing; EBRD tracked portfolio only

26.83%

25.61%

32.86%

15.85% 14.29%

25.81%

12.9%

29.03%

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Investment Profitability by Exit Type

Note: investment profitability is the difference between exit proceeds and investment cost; EBRD tracked portfolio only.

-100

0

100

200

300

400

500

1H 2007 2H 2007 1H 2008 2H 2008 1H 2009

EUR

Mill

ions

Public Market Trade Sale Write-offs Other MBO

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Returns Data & Trends

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Gross Snapshot: All Funds (since inception to 1H 2009)

EUR 3,405m EUR 3,116m

EUR 395m EUR 951m

EUR 2,842m

EUR 6,331m

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

11,000

12,000

EUR

Mill

ions

Fully Realised (Including WO)

Partially RealisedUnrealised

Overall 1.57x 17.19%

FR 2.23x 20.46%

PR 2.41x 23.9%

UR 0.92x -4.3%

Investments at CostEUR 6,641m

Total ValueEUR 10,398m


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Summary of Returns, 2007 – 1H 2009

1.5717.19%1.6418.15%2.021.5%Overall0.92-4.3%0.95-2.89%1.5622.94%Unrealised

2.4123.9%2.4627.15%3.7732.29%Partially realised

2.2320.46%2.2820.87%2.1920.29%Fully realised

TVPIIRRTVPIIRRTVPIIRR

1H 200920082007

Note: in EUR, EBRD tracked portfolio only

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Evolution of Returns

Carrying Value of Portfolio Gross IRR

Note: Number of investees reflect unrealised investments including partially realised; EBRD tracked portfolio only

Number of active funds

4

330 Investees329

Investees307Investees291

Investees

18.15% 17.19%

21.50% 20.93%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Dec-07 Jun-08 Dec-08 Jun-09

EUR

Mill

ions

0%

5%

10%

15%

20%

25%

83 Funds81 Funds81 Funds

79 Funds

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Geographical Origin of LPs


23.70%

22.04%

19.44%

45.52%

49.94%

19.71%

12.91%

9.29%

24.40%

17.88%

18.73%

36.44%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

2007

2008

1H 2009

USA Europe EBRD Other regions

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Evolution of Funds Raised by Investor Type, 2007-1H 2009

27.92% 34.87%

11.57%

41.06% 33.26%

22.14%

19.18% 15.29%

61.64%

11.84% 16.58%4.64%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 1H 2009

Others Funds-of-funds and Pension Funds IFIs and Governments Banks and insurance companies


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Definitions

• Fund Investment Stage: seed/start-up, growth/expansion, buyout, and other.

• Fund Investment Type: venture capital, private equity, mezzanine, distressed/special situations, and other.

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EBRD Region

• CEE Countries – Estonia, Czech Republic, Hungary, Latvia, Lithuania, Poland, Slovak Republic, Slovenia

• SEE Countries – Albania, Bosnia & Herzegovina, Bulgaria, Croatia, FYR Macedonia, Kosovo, Montenegro, Romania, Serbia, Turkey

• CIS Countries – Armenia*, Azerbaijan, Belarus*, Georgia, Kazakhstan, Kyrgyz Republic, Moldova, Russian Federation, Tajikistan*, Turkmenistan, Uzbekistan*, and Ukraine

• CSE Countries – countries included in CEE & SEE lists as shown above

* There are no fund sub-investments in these countries as of end June 2009

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Copyright 2010 EBRD. All rights reserved

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Development. All rights reserved.

Documents

Impact of the Financial Crisis Evolution of Private Equity ... · Evolution of New Investments and Exits in EBRD region (by number of transactions) Note: EBRD tracked portfolio only