VENTURE-BACKED IPO VOLUME CONTINUES TO INCREASE IN Q2 2010 WHILE ACQUISITIONS HOLD STEADY
(Thomson Reuters ONE) -
Strongest Quarter for Venture-Backed IPO Volume Since Fourth Quarter 2007;
Post-IPO Performance Improvement Sought
New York, New York, July 1, 2010 - Venture-backed company exit activity showed
continued momentum during the second quarter of 2010, with the best quarterly
total for venture-backed Initial Public Offerings (IPOs) since the fourth
quarter of 2007, according to the Exit Poll report by Thomson Reuters and the
National Venture Capital Association (NVCA). The quarter ended with 17
venture-backed IPOs, marking the third consecutive quarter for increased
offerings, by number and by dollar amount. There were also 92 M&A transactions
completed in the quarter, demonstrating continued strength of venture-backed
acquisitions as an exit alternative.
"From a pure volume perspective, the venture-backed exit market is on the right
trajectory with an increased number of IPO's and a stable and strong number of
acquisitions. The second quarter activity supports the notion that an initial
public offering is a viable exit alternative once again," said Mark Heesen,
president of the NVCA. "However, volumes paint only half the picture. While
the quality of acquisitions has held up, post-IPO performance must improve
overall if we want to move towards a sustainable recovery."
Venture-Backed Liquidity Events by Year/Quarter, 2004-2010
+------------+-------+----------+----------+---------+--------+--------+-------+
| | | | | | | |Average|
| | |M&A Deals | *Total |*Average | | Total | IPO |
| |Total | with |Disclosed |M&A Deal | | Offer | Offer |
| | M&A |Disclosed |M&A Value | Size |**Number| Amount |Amount |
|Quarter/Year| Deals | Values | ($M) | ($M) |of IPO's| ($M) | ($M) |
+------------+-------+----------+----------+---------+--------+--------+-------+
|2004 | 349 | 188 | 16,043.8| 85.3| 94 |10,481.6| 111.5|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2005 | 350 | 163 | 17,324.7| 106.3| 57 | 4,482.4| 78.6|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2006 | 377 | 164 | 19,034.8| 116.1| 57 | 5,117.1| 89.8|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2007-1 | 88 | 31 | 4,640.3| 149.7| 18 | 2,190.6| 121.7|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2007-2 | 90 | 37 | 3,912.1| 105.7| 25 | 4,146.8| 165.9|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2007-3 | 108 | 55 | 11,261.7| 204.8| 12 | 945.2| 78.8|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2007-4 | 93 | 45 | 9,645.8| 214.4| 31 | 3,043.8| 98.2|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2007 | 379 | 168 | 29,460.0| 175.4| 86 |10,326.3| 120.1|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2008-1 | 109 | 42 | 4,983.2| 118.7| 5 | 282.7| 56.6|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2008-2 | 87 | 27 | 3,321.2| 123.0| 0 | 0.0| 0.0|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2008-3 | 89 | 32 | 3,080.2| 96.3| 1 | 187.5| 187.5|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2008-4 | 66 | 18 | 2,390.9| 132.8| 0 | 0.0| 0.0|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2008 | 351 | 119 | 13,775.4| 115.8| 6 | 470.2| 78.4|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2009-1 | 64 | 15 | 666.0| 44.4| 0 | 0.0| 0.0|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2009-2 | 65 | 13 | 2,570.1| 197.7| 5 | 720.7| 144.1|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2009-3 | 69 | 23 | 1,392.4| 60.5| 3 | 572.1| 190.7|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2009-4 | 73 | 40 | 8,902.5| 222.6| 4 | 349.3| 87.3|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2009 | 271 | 91 | 13,531.1| 148.7| 12 | 1,642.1| 136.8|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2010-1 | 119 | 31 | 5,586.6| 180.2| 9 | 936.2| 104.0|
+------------+-------+----------+----------+---------+--------+--------+-------+
|2010-2 | 92 | 22 | 2,932.2| 133.3| 17 |1,274.91| 75.0|
+------------+-------+----------+----------+---------+--------+--------+-------+
Source: Thomson Reuters & National Venture Capital Association
*Only accounts for deals with disclosed values
**Includes all companies with at least one U.S. VC investor that trade on U.S.
exchanges, regardless of domicile.
IPO Activity Overview
There were 17 venture-backed IPOs valued at $1.3 billion in the second quarter
of 2010, the strongest quarter, by number of deals and dollar volume, since the
fourth quarter of 2007. The offerings spanned a diverse set of industries.
Four of the 17 IPO exits for the quarter were in the Internet Specific sector,
accounting for a total of $181.8 million. Within this sector, Gaithersberg,
Maryland-based Broadsoft, Inc (BSFT), a developer of voice-over information
technology, raised $67.5 million.
Tesla Motors, Inc. (TSLA), a manufacturer of electric vehicles based in San
Carlos, California, began trading on June 29th and raised $226 million, marking
the largest venture-backed IPO of the quarter. Tesla falls into both the
Transportation sector and the larger Clean Tech sector which crosses a number of
industries.
Venture-Backed IPO Industry Breakdown
+---------------------------------------+--------------------------------------+
| | Q2 2010 |
+---------------------------------------+-------------------+------------------+
| | *Number of | Total |
| | Venture-Backed | Venture-Backed |
| Industry | IPO's in the U.S. |Offering Size ($M)|
+----------------+----------------------+-------------------+------------------+
| |Internet Specific | 4 | 181.8|
| +----------------------+-------------------+------------------+
| |Semiconductors | 1 | 91.6|
| +----------------------+-------------------+------------------+
| |Communications and | | |
| |Media | 1 | 60.0|
| +----------------------+-------------------+------------------+
| |Computer Hardware | 1 | 56.0|
| +----------------------+-------------------+------------------+
| |Computer Software | 2 | 120.2|
| Information +----------------------+-------------------+------------------+
| Technology |TOTAL | 9 | 509.6|
+----------------+----------------------+-------------------+------------------+
| |Medical/Health | 3 | 222.1|
| +----------------------+-------------------+------------------+
| |Biotechnology | 1 | 78.0|
| +----------------------+-------------------+------------------+
| Life Sciences |TOTAL | 4 | 300.1|
+----------------+----------------------+-------------------+------------------+
| |Transportation | 1 | 226.0|
| +----------------------+-------------------+------------------+
| |Industrial/Energy | 2 | 154.2|
| +----------------------+-------------------+------------------+
| |Manufacturing | 1 | 85.0|
| +----------------------+-------------------+------------------+
| Other |TOTAL | 4 | 465.2|
+----------------+----------------------+-------------------+------------------+
| TOTAL| 17 | 1,274.9|
+---------------------------------------+-------------------+------------------+
*Includes all companies with at least one U.S. VC investor that trade on U.S.
exchanges, regardless of domicile
Integrated Memory Logic, a Campbell, California-based semiconductor company,
raised $45.8 million on the Taiwan Stock Exchange on May 11(th )- the only US
venture-backed company to go public on a non-US exchange in the second quarter.
Of the 17 IPOs in the second quarter, five were trading at or above their
offering prices as of 6/30/2010. Forty-four venture-backed companies are
currently filed for an initial public offering with the SEC.
Mergers and Acquisitions Overview
As of June 30, 2010, 92 venture-backed M&A deals were reported for the second
quarter, 22 of which had an aggregate deal value of $2.9 billion. The average
disclosed deal value was $133.3 million. This volume marks a decline from the
record-breaking first quarter of 2010, but a 42% increase by number of deals
compared to second quarter 2009. Average disclosed transaction value of $133.3
million is down 26% from Q1 2010 and 33% from Q2 2009.
The information technology sector led the venture-backed M&A landscape, with 78
deals and a disclosed total dollar value of $2.4 billion. Within this sector,
internet specific and computer software companies accounted for the bulk of the
targets with 35 and 29 transactions, respectively, across these sector subsets.
Venture-Backed M&A Industry Breakdown
+----------------------------------------+-------------------------------------+
| | Q2 2010 |
+----------------------------------------+-----------+------------+------------+
| | | Number of | |
| | | Venture- | Total |
| | Number of |Backed M&A | Disclosed |
| | Venture- |deals with a| Venture- |
| |Backed M&A | disclosed |Backed Deal|
| Industry | deals | value | Value ($M) |
+---------------+------------------------+-----------+------------+------------+
| |Internet Specific | 35 | 12 | 1,736.5|
| +------------------------+-----------+------------+------------+
| |Computer Software | 29 | 4 | 651.7|
| +------------------------+-----------+------------+------------+
| |Semiconductors/Other | | | |
| |Elect. | 4 | 1 | 15.0|
| +------------------------+-----------+------------+------------+
| |Communications and Media| 8 | 1 | 2.5|
| +------------------------+-----------+------------+------------+
| |Computer Hardware | 2 | - | -|
| Information +------------------------+-----------+------------+------------+
| Technology | 78 | 18 | 2,405.7|
+---------------+------------------------+-----------+------------+------------+
| |Medical/Health | 6 | 1 | 225.0|
| +------------------------+-----------+------------+------------+
| |Biotechnology | 2 | - | -|
| +------------------------+-----------+------------+------------+
| Life Sciences | | 8 | 1 | 225.0|
+---------------+------------------------+-----------+------------+------------+
| |Manufacturing | 1 | 1 | 200.0|
| +------------------------+-----------+------------+------------+
| |Industrial/Energy | 2 | 1 | 61.5|
| +------------------------+-----------+------------+------------+
| |Business Services | 3 | 1 | 40.0|
| Non-High +------------------------+-----------+------------+------------+
| Technology | | 6 | 3 | 301.5|
+---------------+------------------------+-----------+------------+------------+
| TOTAL| 92 | 22 | 2,932.2|
+----------------------------------------+-----------+------------+------------+
Source: Thomson Reuters & National Venture Capital Association
In the biggest venture-backed deal of the quarter, Google Inc acquired AdMob,
Inc, a San Jose, California-based operator of a mobile advertising marketplace
for $750 million. In the next largest transactions of the quarter, Symantec
acquired PGP Corporation and Jack Henry & Associates acquired iPay Technologies
LLC, each for $300 million.
Deals bringing in the top returns, those with disclosed values greater than four
times the venture investment, accounted for 65 percent of the total in the
second quarter of 2010, Venture-backed M&A deals returning less than the amount
invested accounted for 15 percent of the quarter's total, compared to 31 percent
last quarter.
Analysis of Transaction Values versus Amount Invested
+----------------------------------------------------+------------+------------+
|Relationship between transaction value and | | |
|investment |Q1 10 M&A **|Q2 10 M&A **|
+----------------------------------------------------+------------+------------+
|Deals where transaction value is less than total | | |
|venture investment | 9 | 3 |
+----------------------------------------------------+------------+------------+
|Deals where transaction value is 1-4x total venture | | |
|investment | 7 | 4 |
+----------------------------------------------------+------------+------------+
|Deals where transaction value is 4x-10x total | | |
|venture investment | 9 | 9 |
+----------------------------------------------------+------------+------------+
|Deals where transaction value is greater than 10x | | |
|venture investment | 4 | 4 |
+----------------------------------------------------+------------+------------+
|Total Disclosed Deals | 29 | 20 |
+----------------------------------------------------+------------+------------+
Source: Thomson Reuters & National Venture Capital Association
** Disclosed deals that do not have a disclosed total investment amount are
not included.
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About National Venture Capital Association
The National Venture Capital Association (NVCA) represents more than 425 venture
capital firms in the United States. NVCA's mission is to foster greater
understanding of the importance of venture capital to the U.S. economy and
support entrepreneurial activity and innovation. According to a 2008 Global
Insight study, venture-backed companies accounted for 12.1 million jobs and $2.9
trillion in revenue in the United States in 2008. The NVCA represents the public
policy interests of the venture capital community, strives to maintain high
professional standards, provides reliable industry data, sponsors professional
development, and facilitates interaction among its members. For more information
about the NVCA, please visitwww.nvca.org.
CONTACTS
Emily Mendell
NVCA
1.610.565.3904
emendell(at)nvca.org
Jeanette Volpi
Public Relations Director, Investment & Advisory
Thomson Reuters
1.646.223.5517
jeanette.volpi(at)thomsonreuters.com
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Datum: 01.07.2010 - 17:27 Uhr
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