28. alpbacher finanzsymposium 2014 - finance trainer. alpbacher finanzsymposium 2014 ... combination...

Strictly private and confidential

® 2009 EQT – All Rights ReservedStrictly Private and Confidential® 2012 EQT – All Rights ReservedStrictly Private and Confidential

28. Alpbacher Finanzsymposium 2014 A4_Wachstum sichern in Partnerschaft mit Finanzinvestoren

Case Study: EQT & Automic Software

2 October 2014


Founded 1994 Part of the Wallenberg network Entrepreneurs with an industrial orientation Around 300 employees – 16 offices Approximately EUR 22 billion capital raised in 17

funds with four investment strategies– Equity– Mid Market– Infrastructure– Credit

~120 investments and ~60 exits Top quartile performance over time

EQT Overview

1

“To be the most successful investment organization

by combining entrepreneurship, industrial approach and

financial discipline in the markets where we operate”

EQT’s Strategic Vision


Influenced by industrial background Develop companies to become sustainable market leaders by

– Providing access to large proprietary network of industrial advisors and companies– Utilizing senior industrialists to manage corporate governance– Investing significantly in growth and margin improvements

This allowed EQT to create market leaders and become highly successful investor

What Distinguishes EQT?

ConventionalPrivate Equity Fund

Industrial Families / Industrial Corporate

Industrial Financial Investor

EQT Positioning

2


Focus of the Funds Vintage Year / Current Size

3

Multiple Business Lines

Equity 2011 € 4.75bn

Expansion Capital

2007 € 474m

Greater China

2006 US$ 535m

Infrastructure 2012 € 1.93bn

Control or co-control equity investments High-quality, market-leading companies Potential for top line growth and margin improvements Investments in Nordics, Eastern Europe and German-

speaking countries

Equity oriented expansion capital Mid-market companies Enable expansion while leaving control with owner Investments in Nordics and German-speaking countries Mid-market buyouts in Greater China and Southeast

Asia

Essential service providers, long-term reliable and protected cash flows

Global operations with focus on Nordics, parts of Continental Europe and North America

Credit 2010 € 350m Stressed and Distressed European credit investments

Using industrial network to gain better understanding of targets and their industries

Strictly private and confidential 4

Equity Deals by Volume 2001- Q2 2014 D/A/CH Equity Transactions

Market Leader in D/A/CH – 28 EQT Transactions since 2001

* Fund closed in 2010 **Deals include club deals with other PE and thus effects some double counting, deal value of club deals split evenly between club membersNote: LBO transactions in Germany > EUR 160m EV. Sources: Mergermarket, , Capital IQ, EQT Team

12 Equity transactions, 13 Mid Market transactions, 2 Opportunity* transactions,1 Infrastructure transaction in German-speaking Europe (DACH region) since 2001

Equity Deals by Value 2001- Q2 2014 (in EUR bn)

444444

55555

6

6777

89

91010

1212

KKR**

Permira**

Cinven**

PAI**3i**

Carlyle**

CVC

Hg Capital**

InvestcorpIK

BC Partners

Apax**

Blackstone**

Advent**

Triton**EQT

ACP**Bain Capital**

Capvis**

Rhone Capital**

Bridgepoint

MontaguOEP

Triton** 4.3

1.9

Rhone Capital**1.8

Montagu

1.5

Carlyle**

1.1

1.93i**

Investcorp

Capvis**

1.81.8

IK

Bridgepoint**

Hg Capital**

2.0

5.8

9.7

Cinven**PAI**

KKR**

8.8

11.0EQT

Apax**

OEP

13.5

4.9

Advent**4.9

ACP** 3.7

3.33.3

2.1Bain Capital**

CVCBC Partners

8.7Permira**7.7Blackstone**

6.3


Value Creation through GrowthConsistent high returns through sales and earnings growth

Annual EQT Portfolio Company Growth* EQT Value Creation**

*In all companies owned for more than one year in the EQT Equity funds**In exited companies in the EQT Equity funds – does not include Duni and Orrefors Kosta BodaNote: Percentages calculated as a simple average based on each individual portfolio company’s figures

EBITDA 12%

Sales

Number ofemployees 10%

8%

Sales growth

Margin expansion

Strategicre-positioning

Debt pay-down

Share of Value Creation

52%

26%

16%6%

94% of value creation from operationalimprovements and strategic re-positioning


Profile and History Leading independent vendor of business process automation

software

~680 FTEs**, with HQs in Vienna (Austria) and Bellevue (US), other significant presence in Paris (France) post Orsypacquisition

Founded in 1985 by Franz Beranek. Capexit and Pontis(Austrian VCs) took minority stake in 2004. Founder/VCs sold to Carlyle in 2006 (mgmt/founder still hold minority stake), EQT acquired in 2012

Business Model Revenue model based on licenses, recurring maintenance

revenues and services

Product offering is based on automation engine, “ONE Automation”, focuses on three key areas:

– Application Release Automation

– Application Workload Automation

– Application Service Orchestration

Loyal and diversified customer base with ~3,400** existing customers, across a broad variety of end-customer sectors locked into maintenance agreements

Description Sales Development (€m)*

6* FY ends 30 April** Post Orsyp acquisitionSource: Company information

Leading independent software vendor for business process automation with stable and consistent growth trajectory. Global footprint with more than 3,400 existing customers

Automic Software

60%

EuropeAmericas

Asia

35%

3%Other

3% 16%

Services

37%

MaintenanceLicense

47%

By region By category

118

78736255514643

13

+10%

1411 12100908 14PF

Revenue

Sales Split 2014PF

Automic Stand-Alone Incl. Orsyp


• Several Chairman roles at EQT portfolio companies (e.g. KMD, Scandic, SSP, BTX)

• Previously: Austrian Airlines (CEO), SAS (Deputy CEO)

Vagn Sørensen (Chairman)

Jonas Persson

• BJB Consulting (CEO), CGI (Board member)• Previously: Atos Origin (CEO & Chairman), Tibco (Board member)Bernard

Bourigeaud

• BMW (Board member), Deutsche Bank (Board member), Munich Re (Board member), Nokia (Board member), WIPRO (Board member)

• Previously: SAP (CEO)

Board Member Relevant Background

• Microsoft (CEO Scandinavia)

HenningKagermann

PerFranzen

• EQT Partners

How EQT Supports Automic: Industrial BoardBoard assembled with highly relevant Industrial Advisors to support the strategic development and growth ambitions of Automic going forward

JohannesReichel (Deputy)

• EQT Partners


Management participation Typical shareholder structure following LBO

A co-investment by the management in the deal ensures a high commitment of the team during the investment horizon of the PE firm

Usually the management’s investment is levered which dilutes the sponsor’s return

In general the management team participates in a LBO transaction with a holding of up to 10% in the company

How EQT Supports Automic: Co-Ownership of Management

Management2% – 10%

PE firm90% – 98%

Management becomes co-owner in the company aside of EQT to drive entrepreneurship, commitment and aligned interests across all shareholders

8


Approximately EUR 22 billion of capital raised since inceptionHow EQT Supports Automic: Capital Always Available…

9

1995EQT I€349m

1998EQT II€676m

EQT DK€135m

2011EQT VI

€4,815m

2010Credit I€321m

1999EQT FI€138m

2001EQT III

€2,000m

2003EC I

€189m

2004EQT IV

€2,500m

2005Opp

€372m

2006EQT V

€4,250mGC II

$535m

2007EC II

€474m

2008Infra I

€1,167m

2013Infra II

€1,938mMid Market

€1,054Credit II€ 845

Source: EQT information

-

5.000

10.000

15.000

20.000

25.000

1995 1998 1999 2001 2003 2004 2005 2006 2007 2008 2010 2011 2013 Capital raised (acc.)

EUR million

1994Stockholm

1998Copenhagen

2008Warsaw

2008London

1999Helsinki

1999Munich

2005Frankfurt

2005Hong Kong

2008New York

2007Oslo

2007Shanghai

2001Zurich

2010Singapore

Strictly private and confidential 10Source: EQT & Automic information

Combination of Automic and Orsyp creates a market leader to rival the ITOM players…for Sound Entrepreneurial Ideas

Cloud automation capabilities

“Com-binedCo”

$200m

$100m

IT A

utom

atio

n re

venu

e


• Troika (EQT Partner, Chairman, CEO) allows for swift decision making

• High quality Board of Directors provides invaluable insights for Management –usually only available to much larger corporations

• “Full transparency”: data driven decision making

Operational Support

• Open for “big thinking”, i.e. calculated risk taking to go beyond organic growth aspirations. M&A is and has been a clear and true option in the strategic arsenal

• Compared to previous (American) PE owner more “European” i.e. better geared to Automic’sDACH heritage while fully supporting and understanding global perspective

Strategic Support

Putting the money where the mouth isCFO Perspective

11

You are a CXO.You are in charge.But are you in control?

The Art of the Possible: By making everyday business operations automatic, you get more time on your side. Automation means low cost and enables you to take the overview, as well as seeing the details. Move from being in charge, to being in control. Believe in the art of the possible. We do.

The Art of the Possible: By making everyday business operations automatic, you get more time on your side. Automation means low cost and enables you to take the overview, as well as seeing the details. Move from being in charge, to being in control. Believe in the art of the possible. We do.

TheArtOfThePossible.comTheArtOfThePossible.com

AutomicAutomic™

Let’s Automate BusinessLet’s Automate Business

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