Private Equity Resources

APER 2006 Year End Review

Courtesy of Private Equity Asia Pacific

APER 2006 Year-End Review

• A 19% increase in incoming funds, to US$25.2 billion
• China ranked first for largest fresh funds pool for a single country, raising US$4.6 billion
• US$50.68 billion in deal value aggregate, a 206.10% increase from 2005
• Average deal size has increased 2.4 times
• A total of 182 exits were known to have been initiated
• US$10 billion has been realised from US$4.39 billion of invested capital

In all its dimensions, 2006 was another banner year for private equity in Asia, further reinforcing the > trends established in 2005. The arrival of each calendar month brought news of either record fresh funds or deals. Read in-depth analysis, plus extensive charts and data from the APER Year-End Review 2006.

Funds

• US$25.2 billion of fresh capital has come into the market in the 12 months ending December, representing an increase of 19% compared to the US$21.2 billion for 2005.
• The number of funds contributing to the fresh funds pool in 2006 was 111, a modest 6% increase over the 105 recorded for 2005.
• The average fund size has increased by 12.5% to US$226.8 million, from US$201.5 million in the preceding 12 months.
• Buyout funds dominated the 2006 fund pool profile, accounting for US$11.0 billion, or 44%, and was a 27.6% increase compared to US$8.64 billion for 2005.

Growth of Asian Private Equity Fund Pool (2001 – 2006)
Investments

• US$50.68 billion in transaction aggregate recorded, a 206.10% increase from the US$16.56
  billion of 2005.
• Transaction sum soared to a record high, with the number of deals consummated in the 12
  months ending December 2006 recording a 26.3% increase, to 403, compared to 319 in 2005. The
  relatively modest growth in the number of deals underscores investors shifting their focus to larger
  deals.
• Average deal size has increased 2.4 times to US$125.77 million compared to that for 2005

The Billion Dollar Deals (2006)
Divestments

• A total of 182 exits were known to have been initiated in 2006, a slight decline compared to the
  200 for 2005.
• Initial public offerings (‘IPOs’) continued to dominate the exit route, with 62.6% of the liquidation
  of stakes achieved through such means, with the residual being taken by trade sales.
• US$10 billion has been realised in 2006 from US$4.39 billion of invested capital.
• Returns on realised portfolio companies maintained a stable trend, recording a median internal
  rate of return (‘IRR’) of 51% in 2006, compared to 56% in the preceding 12 months.