generating revenue globally: tapping into markets abroad · 2020. 4. 14. · global private equity...
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Generating Revenue Globally: Tapping into Markets Abroad
Generating Revenue Globally: Opportunities in Latin America
Presenter:
David Frazee
K&L Gates Palo Alto
Copyright © 2010 by K&L Gates LLP. All rights reserved.
GENERATING REVENUE: TAPPING INTO LATIN AMERICAN MARKETS : Overview and Intro
Palo AltoNovember 1, 2011
David FrazeeK&L Gates LLP630 Hansen WayPalo Alto, [email protected]
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Panelists
1. Alejandro Fiuza, K&L Gates
2. Ricardo Berrios, AeroScout
3. Fernando Silis Reyna, Deloitte
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Setting Up and Doing Business
� Investing in the region� Getting money in, getting money out� Syndicates with local investors� Exits
� Partnering with local companies� JVs and partners� Contracts
� Doing business directly � Subsidiaries, regulatory, labor, and other issues
� Business model optimization� Raising capital locally
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Taxes
� Optimization of global structure� When to go direct, when not to� Treaty networks: the good and the ugly� Tax issues in financing subsidiaries� Coming into the U.S. from outside
� Optimization of local taxes� Tax credits and incentives� Tax reform
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Other Concerns
� Intellectual property� Employment� Trade issues� Exits (IPOs and M&A issues)� Political changes� Cultural differences� Differences among countries
Generating Revenue Globally: Generating Revenue in Latin America
Presenter:
Alejandro Fiuza
K&L Gates New York
Copyright © 2010 by K&L Gates LLP. All rights reserved.
GENERATING REVENUE: TAPPING INTO LATIN AMERICAN MARKETS
SAN FRANCISCONovember 1, 2011
BO #3215727v2
Alejandro D. FiuzaK&L Gates LLPOne Lincoln StreetBoston, [email protected]
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FIRST - LET’S GET PAST TWO ISSUES:
Tapping into LATIN AMERICA? Why?
For the same reason many of you arelooking at China: Because there areopportunities.
Where did he say this guy was from?
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Tapping into Latin America
1. Opportunities in Latin America
2. Overview of Private Equity and Venture Capital industries in LATAM
3. Most usual challenges
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1. Opportunities
� Commodities and natural resources (agribusiness, mining, energy related, renewable energy, oil, shale gas)
� Information technology and biotechnology� Raise of middle class: retail, transport and
infrastructure, media and entertainment� Private equity and VC funds
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2. Overview of Private Equity and VC industry
Players:� Global private equity and VC funds� Local private equity and VC funds� Seed investors and entrepreneurs (Endeavor,
Nest)� Family offices� Multilaterals (Multilateral Investment Fund, CAF)� Local Development Institutions (Argentina,
Brazil, Mexico etc. Chilean Economic Development Agency, CORFO, Start up Chile.org)
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2. Overview of Private Equity and VC industry (con’t)
Players:� Trade Associations: LAVCA, ABVCAP,
AMEXCAP, ARCAP – promote investment, regulatory change and transparency
� LPs: Sovereign funds, institutional investors, local pension funds (Chile, Brazil, Peru, Colombia, Argentina: ANSESS, more active role), wealthy individuals and families.
� Strategic investors (LATAM – based and China)
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© ALIZA OLMERT, TIKKUN, DANIEL MAMAN FINE ART
Usual Challenges – Comparable Benchmark?
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MOST USUAL CHALLENGES1. Cultural differences: One size does not fit all.2. Less information available for investors and asymmetry of
information.� Fund level � transparency and governance� Portfolio company level � transparency and governance
(know your partner, industry, competitors)3. Due diligence :
� Early identify and understand rules for making the investment (approvals and licenses), during the investment and for exiting the investment
� Rules and how they are enforced � Usual suspects: Exchange control rules, labor and union
matters, social security, taxes, real estate. Some countries: environmental
� Others: UK Anti bribery Act and FCPA, US Sanctions and Export Controls, Antitrust, International Trade remedies, customs
17
4. Structuring Your Investment.� Adequate tax planning is of the essence (local, US and
international treaties).Double taxation treaties and bilateral investment treaties may lead to the use of European based structures (e.g., Spain, the Netherlands)
� Selecting the appropriate corporate entity , minority rights, # shareholders, local directors etc.
� Exchange control rules � Inflow and outflow of investments, and antitrust analysis.
� Typical structures vary per country . Sometimes Spain is used as gateway (due to the ETVE regime and the BITs)
Greenfield /Acquisition vs. Strategic Alliances. First ones were most common in 90s and this first decade, second decade may be strategic alliance age.
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“A journey of one thousand miles begins with a single
step”
Lao Tzu
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FIRST RIGHT STEP: SELECT ADVISORS WITH EXPERIENCE IN THE REGION
Generating Revenue Globally: Generating Revenue in Latin America
Presenter:
Ricardo Berrios
AeroScout
Generating Revenue Globally: Generating Revenue in Latin America
Presenter:
Fernando Silis Reyna
Deloitte, Mexico Desk
Generating Revenue Globally: Opportunities in Europe
Questions & Answers
Generating Revenue Globally: Opportunities in the Middle East
Presenter:
Rem Kinne
K&L Gates San Francisco
Generating Revenue Globally: Opportunities in the Middle East
Presenter:
Greg Hartker
K&L Gates Orange County
Copyright © 2011 by K&L Gates LLP. All rights reserved.
Generating Revenue Globally:Tapping into Markets Abroad-Middle East
Greg HartkerNovember 1, 2011
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Taxation in the Middle East
� Constantly changing environment especially in Egypt/North Africa
� Need to consider both US and non-US regimes
� Rigid structures may hinder taxpayers down the road
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Taxation in the Middle East
� Key Issues to Consider� Corporate Tax Rate� Withholding Rates
� Interest� Dividends
� Transfer Pricing Regime� Treaty Network
28
Taxation in the Middle East- Dubai/UAE
� Corporate Tax Rate- None (except for Oil/Banking)� Withholding Rates- None� Transfer Pricing Regime- None� Treaty Network- Extensive� Other
� The UAE has been studying the possible introduction of VAT for some time. However, the GCC member states (UAE, Saudi Arabia, Kuwait, Bahrain, Qatar and Oman) want to roll out VAT simultaneously to replace revenues derived from trade taxes, which are due to be phased out as a number of free trade agreements signed by the GCC, including one with the EU, become effective. It is thought that this won't happen until 2012 at the earliest (and probably later than that).
29
Taxation in the Middle East- Egypt
� Corporate Tax Rate- 20% flat rate� Withholding Rates– None on dividends (although
proposal to add) and 20% on interest payments � Transfer Pricing Regime- Yes, most sophisticated in
the region� Tax Treaties- Numerous� Other
� There was some speculation that Egypt might adopt a progressive tax rate scheme. Fundamental changes in the corporate tax scheme occurred in 2005 and given recent activities, the state of the tax system could change dramatically. Has a VAT.
30
Taxation in the Middle East - Qatar
� Corporate Tax Rate-10% flat rate� Withholding- Withholding for certain payments to
persons without a PE (or tax card). No withholding for dividends. Withholding on interest is under a moratorium.
� Transfer Pricing Regime- No� Treaty Network - Growing� Other
� New tax law effective January 1, 2010. Certain aspects remain unclear (see e.g., interest withholding). The Ministry is expected to issue regulations to clarify some of the uncertainty.
31
Taxation in the Middle East – Saudi Arabia
� Corporate Tax Rate- 20% Non Saudi share (Zakat for Saudi shareholders).
� Withholding Rates – 5% rate on dividends and interest.
� Transfer Pricing Regime- None although authorities may make adjustments for non arm’s-length payments.
� Treaty Network- Growing.� Other
� Becoming more aggressive on PE issues.
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Taxation in the Middle East – Treaty Example
� UAE has treaties with at least 47 countries (not including the GCC states) including the following MENA countries: � Algeria� Egypt� Lebanon� Morocco� Syria� Tunisia� Turkey
33
Taxation in the Middle East – Treaty Example
Assume US company plans on doing business in Morocco through a Moroccan subsidiary.
� Morocco normally imposes withholding taxes on dividend and interest payments made to non-residents at a 10% rate.
� US-Morocco Treaty limits dividend withholding taxes to 15%. Thus, no benefit under such Treaty.
� Under the Moroccan-UAE Tax Treaty, Moroccan withholding taxes on dividends distributed by a Morocco corporation to a Dubai corporation holding at least 10% of its capital stock is reduced from the normal rate of 10% to 5% and interest (also normally subject to a 10% withholding tax) "flows free" of any Moroccan withholding tax.
34
Taxation in the Middle East – Treaty Example
Establish FTZ Dubai intermediary company*
US
Dubai/UAE
Morocco
* Need to ensure enough presence in Dubai to qualify for benefits under Morocco Treaty yet not taint FTZ qualification.
5%
0%
Dividend
Generating Revenue Globally: Opportunities in the Middle East
Presenter:
Eric Chan
Embee Mobile
Company Presentation
1
Embee Mobile
Reward users For brand engagement With free mobile airtime and content
Embee Mobile: How It Works
Users
Rewards
Mobile Phone
Brand Engagement
Mobile Operator
3
Company Snapshot
Current Users: 1.5M Service Launched
April 2009 Social Media
Application (web)
90 Countries, 300 Mobile Operators
Focus on the Middle East
Bahrain Cyprus Egypt Iran Iraq Israel Jordan Kuwait Lebanon
5
Traditional Middle East Greater Middle East
Afghanistan Algeria Armenia Azerbaijan Comoros Djibouti Eritrea Georgia Kazakhstan Kyrgyzstan Libya
Mauritania Morocco Pakistan Somalia Sudan Tajikistan Tunisia Turkmenistan Uzbekistan Western Sahara
Oman Palestine* Qatar Saudi Arabia Syria Turkey United Arab Emirates Yemen*
Population: 382M (17) GDP: $4,071 Billion (2008)
Population: 401M (21) GDP: $1,530 Billion (2008)
Source: Wikipedia
Contact: Eric Chan ([email protected]) http://www.embeemobile.com Facebook: http://apps.facebook.com/mobilewallet Twitter: @embeemobile
6
Generating Revenue Globally: Opportunities in the Middle East
Presenter:
Dotan Russo
Deloitte, Israel Desk
Generating Revenue Globally: Opportunities in the Middle East
Presenter:
Richard Juarez
Morgan Joseph TriArtisan
Confidential
K&L Gates SymposiumSan Francisco, CA
Generating Revenue Globally: Tapping into Markets Abroad
“Opportunities in EMEA”
November 1, 2011
Confidential 2
1. Market Opportunities
2. Merger and Acquisitions Activity
3. MJTA Case Study
4. Active Investors
5. Appendix
A. Morgan Joseph TriArtisan Technology Team Overview
B. Senior Management Biographies
C. TMT Investment Banking Biographies
Table of Contents
Confidential 3
1. Market Opportunities
Confidential 4
Public Cloud Services - WorldwideKey Insights
Worldwide market for public cloud services was $74.3 billion in 2010, up from 58.6 billion in 2009 (+26.7%)Business process services makes up 81% of the total cloud services in 2010, however systems infrastructure has the highestprojected growth rate of 47.9%North America and Europe continue to dominate the market for cloud services with 83.5% in 2010, however along with Japan have the lowest growth ratesMiddle East and Africa and Eastern Europe are projected to see strong growth with 55.2% and 10.8% CAGR to 2015 respectively
Cloud Services by Type of Service
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
Business ProcessServices
Application ApplicationInfrastructure
SystemsInfrastructure
2010 2011 2012 2013 2014 2015
17.2%
16.3%
13.0% 47.9%
Source: Gartner
Cloud Services by Major Region, Percentage of Total
Region 2010 2011 2012 2013 2014 2015 CAGR
North America 61.0 60.0 59.0 56.8 54.5 52.1 -3.1%Western Europe 22.5 22.9 23.7 25.0 26.0 27.0 3.7%Eastern Europe 1.5 1.8 1.9 2.1 2.2 2.5 10.8%Middle East and Africa 0.1 0.2 0.3 0.5 0.7 0.9 55.2%Japan 9.8 9.9 9.9 10.0 10.5 11.0 2.3%Asia/Pacific 3.0 3.0 3.0 3.2 3.5 3.7 4.3%Latin America 2.1 2.2 2.2 2.4 2.6 2.8 5.9%Total 100 100 100 100 100 100
Confidential 5
Software as a Service, WorldwideWestern Europe
In the developed regions, SaaS offerings and adoption rates are rapidly increasing17% CAGR for 2010-2015
EMEA
Potential for SaaS is mid to long term, currently limited by infrastructure, localization and go-to-market strategies by the vendorsEastern Europe – 22% CAGRMEA – 24% CAGR
Issues for Deployment
Limited flexibility was ranked 1st for EMEANetwork instability was ranked 2nd for EMEA
SaaS Adoption by Application, EMEA
Software Revenue Forecast for SaaS Delivery within Enterprise Application SoftwareMillions of U.S. Dollars
Region 2008 2009 2010 2011 2012 2013 2014 2015 CAGR
North America 4,584 5,219 6,472 7,684 8,968 10,311 11,545 12,929 15Western Europe 1,395 1,675 2,160 2,663 3,190 3,775 4,290 4,813 17Asia/Pacific 321 421 602 768 975 1,211 1,451 1,694 23Japan 224 268 315 379 435 501 565 629 15Latin America 153 193 266 328 416 513 601 694 21Eastern Europe 64 78 101 131 162 192 232 270 22MEA 55 67 87 120 141 179 212 251 24Total 6,795 7,921 10,003 12,073 14,287 16,682 18,896 21,280 16
Confidential 6
2. Merger and Acquisitions Activity
Confidential 7
Q3 2011 Global M&A Statistics
Source: Bloomberg
• Over 97% of all M&A transactions occurred in the mid-market range (below $500 million in size) while 5 deals soared into the mega-deal category (more than $10 billion in size), which is nearly twice as many compared to the same period last year.
• Cash was the dominant form of payment, accounting for 69.29% of M&A volume this quarter, while 11.06% of all volume was comprised of all-stock payments, a drop of more than 38% compared to the 3rd quarter of 2010. For public deals, median total value to EBITDA multiples increased by 26.94% for 2010.
Confidential 8
Global M&A OverviewQ3 2011 Volume by Industry and Region
Source: Bloomberg
Regional Deal Activity
Global M&A activity in the 3rd quarter dropped by more than 12% compared to the same period last year. U.S. based firms dominated on the buy-side, accounting for 40% of all global M&A volume.
Japanese firms announced acquisitions worth more than $53 million, including Nippon Steel’s $22.5 billion all-stock takeover of Sumitomo Metal Industries. This represents a year-over-year increase in excess of 60% and the highest quarterly volume since the 1st quarter of 2005.
3rd quarter deal-making in Western Europe dropped by more than 26% compared to the same period last year, the sharpest decline since the 1st quarter of 2010, reflecting sovereign debt concern in the region.Industry Sector Deal Activity
Acquisitions by private equity firms this year have exceeded $144 billion in total deal volume, the 4th largest total of all time. The $5.7 billion leveraged buyout of Kinetic Concepts by a consortium led by Apax Partners and two Canadian pension funds is the largest private equity takeover announced since 2008.
Takeovers in the Aerospace/Defense industry this quarter reached an all-time high, with total volume exceeding $20 billion, topped by the largest transaction of all time in this industry: United Technologies’ $18 billion cash bid for Goodrich.
Average premiums in the wireless equipment industry jumped to more than 72%, the highest since the 3rd quarter of 2002. The all-time largest announced deal in this sector, Google’s all-cash buyout of Motorola Mobility Holdings for $9.8 billion, had an announced premium of 73%.
Confidential 9
Deal Location Analysis by Value
$9,910
$622
$5,735
$7,617
$1,071
$12,484
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
Domestic Inbound Outbound
Nu
mb
er i
n M
illi
ons
1H 2010 1H 2011
Deal Location Analysis by Volume
107
3
20
120
2330
0
20
40
60
80
100
120
140
Domestic Inbound Outbound
1H 2010 1H 2011
1H 2011 Value vs. Volume
$4,001
$2,239
$661
$4,729
$3,760
$5,781 3232
2525
30
29
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
January February March April May June
Num
ber
in M
illio
ns
0
5
10
15
20
25
30
35
Value Volume
Source: Zawya
1H 2011 M&A Activity by Value, Volume and Geography1H 2011 M&A Target by Geography
$258.5
$566.3$478.8
$24.4
$2,140.0
$995.4
$10.1<$10.0$127.0$173.1
$743.2
$2,065.0
$1,709.9
32
1
3
6
35 44
10
1414
2124
$0.0
$500.0
$1,000.0
$1,500.0
$2,000.0
$2,500.0
UAE
KSA
Jord
anKuwai
tEgyp
t
Qat
ar
Om
anM
orocc
oTuni
siaBah
rain
Leban
on
Syria
Palesti
ne
Num
ber
in M
illio
ns
0
5
10
15
20
25
30
35
Value Volume
Location Analysis by Value and Volume
Middle East M&A Overview
Confidential 10
Middle East and North Africa
Source: Allen & Overy
MENA Deal Types 2007-2011
Year-over-year M&A has been consistently the dominant transaction type
Confidential 11
1H 2011 Value by Sector
0.0
0.0
2.8
4.9
5.7
6.5
102.1
118.2
130.0
189.8
397.5
873.6
1,020.6
1,201.9
1,695.0
2,570.0
2,969.8
3,861.0
5,959.8
$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000
EducationRetail
TransportationServices
Information TechnologyAgriculture
Mining & MetalsMedia
Food & Beverage
Leisure & TourismConstruction
Real EstateIndustrial Manufacturing
HealthcareConsumer Goods
TelecommunicationPower & Utilities
Financial ServicesOil & Gas
Number in MillionsSource: Bloomberg
1H 2011 Sector by Market Share and Value
Middle East Sector Analysis
M&A deal volume increased 33.1% from 1H2010 to 1H2011
Telecom, Media and Technology (TMT) accounted for 11.9% of deal volume in 1H 2011 behind Financial Services and Industrial Manufacturing with 24.4% and 14.2%, respectively
M&A deal value reached $21.2 billion in 1H2011, an increase of 30.1% compared to 1H 2010
Telecom, Media and Technology (TMT) deal value nearly tripled reaching $2.6 billion compared to $684.5 million in 1H 2010
Confidential 12
2. EMEA Private Placements
Confidential 13
Select Tech Private Placement Transactions Middle East
Source: Capital IQ and 451 Group
($ in millions)
Date Target Country Investors Amount Raised Target Business Description
10/24/2011 SolarEdge Technologies Ltd. Israel
Norwest Venture Partners; Walden International; Genesis Partners Ltd.; Lightspeed Venture Partners; Vertex Venture Capital; GE Energy Financial Services; Opus Capital
$37.0 Provides DC power systems for photovoltaic array.
10/18/2011 Waze Ltd. Israel Kleiner, Perkins, Caufield & Byers; Horizons Ventures Limited; iFund, L.P.; KPCB Digital Growth Fund, L.P. $30.0 Provides a social mobile application that enables drivers to build and use real-time road
intelligence on smart phones.
7/22/2011 Trendyol Turkey Kleiner, Perkins, Caufield & Byers; Tiger Global Management LLC $26.0 Operates private shopping site providing fashion and designer retail items for men, women, kids,
and home.
6/27/2011 N-Trig Ltd. Israel Undisclosed Investors $30.0Manufactures transparent electromagnetic digitizers for original equipment manufacturers/original design manufacturers, LCD manufacturers, and independent software developers.
4/10/2011 Altair Semiconductor Ltd. IsraelBessemer Venture Partners; Jerusalem Venture Partners; BRM Group; Giza Venture Capital; Pacific Technology Partners
$26.0 Develops ultra low power mobile WiMAX silicon solutions for handsets and handheld devices.
3/28/2011 Wixpress Ltd. IsraelBenchmark Capital; Bessemer Venture Partners; Insight Venture Partners; Mangrove Capital Partners; DAG Ventures, LLC
$40.0 Offers an online platform to create flash Websites and layouts.
3/25/2011 Noktacom Medya Internet Hizmetleri Sanayi ve Ticaret A.S. Turkey Intel Capital $50.0 Operates as an online media company connecting users through social media properties.
3/14/2011 KOREK Telecom Ltd. Iraq France Telecom; Agility Public Warehousing Company KSC $295.0 Provides mobile telephony products and services.
1/12/2011 PrimeSense Ltd. Israel Canaan Partners; Gemini Israel Funds; Silver Lake Partners; Genesis Partners Ltd.; Silver Lake Sumeru, L.P. $50.0 Develops 3D machine vision technologies for digital devices.
12/20/2010 Magic Software Enterprises Ltd. Israel Undisclosed Investors $21.2 Develops, markets, and supports software development and deployment technology and applications.
12/7/2010 Waze Ltd. Israel BlueRun Ventures; QUALCOMM Ventures; Vertex Venture Capital; Magma Venture Partners $25.0 Provides a social mobile application that enables drivers to build and use real-time road
intelligence on smart phones.
11/16/2010 Anobit Technologies Ltd. Israel Intel Capital $32.0 Develops solutions for the flash memory market.
Confidential 14
3. MJTA – EMEA/Europe/Asia Case Study
Confidential 15
Company Background
Based in Western Europe, Project Vivid is leading global provider of carrier-grade real-time video communication and collaboration software for the enterprise and small and medium business (SMB) market.
Gartner has ranked the Company as a visionary over the last four years, continuously improving its position each year.
Company's product Suite compares favorably with competitive products from Cisco, Microsoft, IBM, Adobe and Citrix.
Project Vivid has successfully achieved commercial scale by acquiring and retaining leading international corporate clients including Airtel India, Tata Group, Telefonica, Telecom Italia and Vodafone, among others.
Transaction Details
Morgan Joseph TriArtisan’s Technology Investment Banking Group was engaged after the company received several unsolicited acquisition offers.
The Company initiated a process, with Morgan Joseph TriArtisan acting as the exclusive financial advisor, and is reaching out to additional, potential buyers to assess interest.
Morgan Joseph TriArtisan’s Role
Morgan Joseph TriArtisan is acting as the sole financial advisor to Vivid and helping the Company navigate the diligence, negotiation, and definitive agreement process.
Morgan Joseph TriArtisan is intimately involved in all aspects of the transaction including: preparation of all marketing materials including the offering memorandum; financial modeling; the management presentation and due diligence.
A number of well known strategics from industries such as telecommunications, network equipment, service providers, and enterprise software and SaaS have shown strong interest in acquiring the Company.
Pending Transactions Project Vivid: Sell-side M&A (In Process)
Project Vivid: Strategic Acquisition Opportunity(Enterprise-Class Video Platform)
Exclusive Advisor In Process
M&A
Confidential 16
4. Active Investors
Confidential 17
Private Equity Firms in Middle EastPrivate Equity Firms in Middle East
Abraaj Capital Dubai International Capital Levant CapitalAbu Dhabi Investment Company Dubai Islamic Bank MarkazAbu Dhabi Investment House Dubai Ports World Millennium Finance CorporationAl Arabi Investment Group EFG-Hermes Private Equity National Commercial BankAl Futtain Real Estate Emerging Markets Partnership (Bahrain) National Technology Enterprises CompanyAl Madina Financial and Investment Services Evolvence Capital NBK CapitalAl Tawfeek Company for Investment Funds Foursan Group Noor Financial Investment CompanyAmwal Al Khaleej Global Investment House Qatar Capital Partners LLCAthar Al Majd Holdings Gulf Capital RasmalaAtlas Investment Group Gulf Finance House Ryada CapitalAttijari Finances Corporation HBG Holdings Limited Sabre Abraaj Management CompanyBMCE Bank HSBC Private Equity (Middle East) Shuaa Capital / Shuaa PartnersBMG Financial Advisors Injaz Mena Investments Societe Tunisienne d’InvestissementBoubyan Bank Injazat Capital Swicorp Financial Advisory ServicesByblos Bank Instrata Capital BSC The Carlyle GroupConcord International Investments Intel Capital The National InvestorCitadel Capital Investcorp Bank B.S.C. Tuareg CapitalCorecap Ithmaar Bank Unicorn Investment BankCorporate Finance House Ithmar Capital Venture Capital BankDaman Securities Kipco Asset Management Company Malaz GroupDelta Partners Kuwait Finance and Investment CompanyDeutsche Bank Kuwait Finance House (Bahrain)
Confidential 18
Top VC Firms In EuropeGermany United Kingdorm France Other
Active Seed InvestorsIndex Seed, Kima Ventures, Seedcamp, Eden Ventures, Point Nine Capital, Doughty Hanson Technology Ventures, Passion Capital, Nesta, Wellington Partners, 360 Capital, Henq, Earlybird, GIMV, Charlotte Street Capital, Estag Capital, ACT Venture Capital, Notion Capital, Samos Investments, Northzone, ProFounders Capital, and Octopus Ventures
Confidential 19
5. Appendix
Confidential 20
A. Morgan Joseph TriArtisan and Technology Team Overview
Confidential 21
Key ExecutivesJohn A. MorganFounding Chairman
John F. SorteExecutive Chairman
Gerald H. CromackCo-President
Rohit ManochaCo-President
Mary Lou MalanoskiVice ChairHead of Investment Banking
www.mjta.com
More than 130 employees engaged in investment banking, capital markets and merchant banking
Merged with merchant banking firm Tri-Artisan Capital Partners, LLC in December 2010 expanding our client focus to large sponsor-led transactions
Independent and closely held
More Experience: Our more than 35 partners average more than 20 years on Wall Street. We enjoy a collaborative, entrepreneurial environment that benefits our clients with the most informed, objective and high-quality execution available
More Service: Our engagement partners are actively involved throughout each assignment. We attack every challenge with integrity, creativity, passion and responsiveness
Greater Capabilities: We provide capital markets distribution and a wide range of advisory services ―ensuring a balanced approach to problem solving, and making more alternatives available to our clients
Better Perspective: We are investors as well as advisors. With insights from our active portfolio of private equity investments, we bring a principal orientation to our advisory clients
Morgan Joseph TriArtisan Factsheet
Beijing
Morgan Joseph Holdings Location
StamfordSan FranciscoRochester, NY (Pittsford)
MiamiLondonAtlantaNew York (HQ)
Morgan Joseph TriArtisan Office Locations
Defining Principles
Overview
Confidential 22
Current Portfolio Companies
$400+ Million of Unaggregated PE Investments
Successful Track Record
M&A and Advisory Services67 Investment Banking Professionals
Capital Markets12 Equity Analysts / 16 Sales and Traders
Merchant Banking17 Professionals / 60+ Operating Partners
Source proprietary private equity transactions Partner with leading private equity firms and institutional limited partnersDeploy capital in a principal capacity12 portfolio investments to date; 6 realizations
Private Placements & Underwriting– Equity Capital Markets– Debt Capital Markets– Convertible Debt
Sales and TradingEquity Research
Mergers & AcquisitionsExclusive SalesFairness OpinionsRestructuringGeneral Advisory
277 Assignments for $75.0 billion* 122 Raises for $14.3 billion*
*Since June, 2001 and includes transactions completed by Tri-Artisan Capital Partners prior to merger in December 2010; Note: Chart data by number of assignments
Buyside Advisory Sellside AdvisoryRestructuring Fairness OpinionsGeneral Advisory / Other
IPOs Follow-onsDebt Offerings Private Placements
Morgan Joseph TriArtisan Full service, Integrated Merchant Bank
Confidential 23
Firm Introduction Equity Capital Markets
Key Contacts
Tina PappasManaging DirectorHead of Equity Capital Markets
Matthew DiBiaseManaging Director Head of Equity Trading
William S. McDermottManaging Director Head of Equity Division
The role of the Equity Capital Markets group is principally to coordinate all equity-oriented public market transactions between syndicate firms and our own research, trading, institutional sales and investment banking personnel
Our senior professionals have extensive experience in trading and underwriting equity and convertible securities, including having formerly managed U.S. capital markets operations for major wall street firms
ECMSales &Trading
Research
InvestmentBanking
Confidential 24
Research Analysts & Industry Coverage Universe
MediaSatelliteCableBroadcasting
David Kestenbaum
Justin Sebastiano
Gaming/Leisure
Jeffrey Blaeser
Consumer Hardlines
Michael French
Industrial & Defense
Firm Introduction Equity Research
Shiv Kapoor
Biotechnology
Ilya Grozovsky
Technology, FinTech
Director of Equity Research
Bruce D. Jackson
Medical Technology
Steve Share
Food & Food Processing
Confidential 25
Merchant Banking Financial Sponsor Coverage
Morgan Joseph TriArtisan Market and Product Group Expertise
Mergers & Acquisitions Restructuring
Private Placements Debt Capital
Convertible Debt China Practice
IMAP Member – Global Relationships
The Appendix provides detailed descriptions of each of the groups outlined above.
Confidential 26
CorrectionsDefense, AerospaceDurable Consumer GoodsFacilities
Data / Information Mgmt.& Technical ServicesFood & BeverageHealthcare Information Tech
MetalsPersonal Care ProductsOutpatient Services
RetailSpecialty Pharmaceuticals
Security Products & Services& ConstructionHousewaresManaged Care
Tobacco
Supermarkets & Drugstores
Trucking
Printing
Marketing ServicesEducation & Training Services
Commercial ServicesBusiness Process Outsourcing
Water
Environmental
Engineering
& ManufacturingDiversified Industrials
ChemicalsBuilding Products
Pharmaceuticals
Medical Devices
Long-term Care
Life Sciences Products & TechHome Healthcare
Contract Research ServicesBiotechnology
Sports Equipment
Restaurants
Lodging
Household Products
GamingFootwear & Apparel
Direct MarketingAlcoholic Beverages
Consumer & LeisureHealthcare Industrial
Other Sector Expertise
Introduction to Morgan Joseph TriArtisan Industry Expertise
Business Services
Specialty Finance
Shipping & Marine ServicesApplied Clean Technology
Property & REITs
BiofuelsOil & Gas
Agriculture
International
AsiaEurope
Technology, Media &
Telecommunications
Business Services BiometricsClean TechnologyCommunicationsCloud Servicese-CommerceHosting SolutionsEntertainmentInformation ServicesInternet & Digital MediaLocation Based ServicesMobile PaymentsMRM/LBSMusic PublishingOnline GamingPaymentsSecuritySaaSSoftware Telecom Services
Investment banking has five dedicated industry groups. Each works closely with our product specialists to achieve client objectives
In addition, among our 67 bankers, 17 merchant banking professionals and 60+ operating partners, Morgan Joseph TriArtisan has deep and specific experience in a number of other industries
Morgan Joseph TriArtisan’s international efforts are focused on select markets in Asia and Europe. Morgan Joseph Holdings maintains a representative office in Beijing, China
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SectorsServices, Targeted Transaction Profiles
Public Capital Raise
IPOs
Follow-ons
PIPEs / Convertibles
SPACs
ATMs
Registered Directs
Private Capital Raise
Typical Client Profile:
Revenues: $20 million+
Raise Amount: $20 million+
M&A
Typical Client Profile:
Revenues: $20 million+
Enterprise Value: $50 million+
Sub-Sectors
Cloud Services
– Content Delivery
– Hosting Infrastructure
– LBS
– Security
– Storage
– Virtualization
– CRM
– Compliance and GRC
– Mobile Applications
– Payment
– Messaging
Software and Services
– Alternative Energy
– Software Enabled Solutions
– Smart Grid
Applied Clean Technology
– Mobile Gaming
– e-Commerce
– Social Networks
– Search
– Online Advertising
Internet and Digital Media
– Communications Processing Equipment
– Wireless Communications
– Networking Equipment
– Asset Tracking
Communications Equipment
Introduction to Morgan Joseph TriArtisanTechnology Team Services and Sector Focus
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Sandeep BeotraManaging Director
TMT Group212.218.3722
Julian HirstJoint Managing PartnerTMT/M&A Group
(Tri-Artisan Advisors Europe LLP)
Rick JuarezManaging Director
TMT Group650.270.2702
Gene RamirezManaging Director
TMT Group650.270.2703
TMT Investment Banking
Financial Advisory and Capital Markets
Introduction to Morgan Joseph TriArtisan Technology, Media & Telecommunications Group
Zachary FisherPrincipal
TMT Group212.218.3749
Anthony Cresci, CFAAssociate
TMT Group650.270.2704
Matthew McLeodAssociate
TMT Group650.270.2705
Eamon BradyAssociate
TMT Group212.218.3858
Xuan YangAnalyst
TMT Group650.270.2707
Tina PappasManaging Director
Head of Equity Capital Markets
William McDermottManaging DirectorHead of Equities212.218.3721
Jim DeckerManaging Director
Head of Financial Restructuring 212.218.3805
Jonathan LowenbergManaging Director and
Private Placements212.218.3727
Cody WernerAnalyst
TMT Group650.270.2708
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B. Senior Management Biographies
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Mr. Sorte is the Executive Chairman of Morgan Joseph TriArtisan. Mr. Sorte joined the firm as Chief Executive Officer in July 2001. From 1994 until June 2001, Mr. Sorte was President of New Street Advisors LP, a private equity firm which he co-founded. In 1980, Mr. Sorte joined Drexel Burnham Lambert's Corporate Finance Department and subsequently served in various positions until 1989 when he was promoted to Executive Vice President and Co-head of Corporate Finance. Following Drexel's bankruptcy filing in 1990, Mr. Sorte was elected Chief Executive Officer and managed the debtor-in-possession to a successful reorganization in 1992. He then remained as Chief Executive Officer of the reorganized firm, which was renamed New Street Capital Corp. New Street Capital, which was a merchant bank owned by a trust for the benefit of Drexel's creditors and shareholders, was sold in 1994. Mr. Sorte began his career at Shearson, Hammill & Co. in 1972 in the Corporate Finance Department. He is a member of the Board of Directors of Vail Resorts, Inc. and Shorts International Ltd. Mr. Sorte holds B.A. and M.E. degrees in Chemical Engineering from Rice University and an M.B.A. from Harvard Business School.
John F. SorteExecutive Chairman+1 212 218 [email protected]
Mr. Morgan founded the firm’s predecessor in 1982 and has served as Chairman of the firm since July 2001. From 1966 to 1982, Mr. Morgan was with Smith Barney & Co., Inc. and Smith Barney, Harris Upham & Co., Inc., serving from 1977 to 1982 as Vice Chairman in charge of the Corporate Finance Department, M&A activities and international activities. From 1956 to 1966, Mr. Morgan was a Partner in the investment banking firm of Dominick & Dominick. Over the years, Mr. Morgan has been an independent Director of a number of public companies, most of them listed on the NYSE. He currently serves as a Trustee of the Provident Loan Society of New York and as a Director of the Pierpont Morgan Library. Mr. Morgan holds a B.A. from Yale University.
John A. MorganFounding Chairman +1 212 593 [email protected]
Morgan Joseph TriArtisan Senior Management Biographies
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Mr. Cromack co-founded Tri-Artisan. Prior to Tri-Artisan, Mr. Cromack was a principal in the 1994 leveraged buyout of Furman Selz LLC, which was sold in 1997 to ING Group. Mr. Cromack remained with ING Group (and the successor owner, ABN AMRO) until the beginning of 2002, serving as an executive member of the investment bank. Prior thereto, Mr. Cromack worked as a senior member in the Mergers and Acquisitions and Corporate Finance Departments of Lehman Brothers Holdings Inc. Mr. Cromack started his career at the First National Bank of Chicago in its leveraged buyout corporate finance group. Mr. Cromack received a BA, with Distinction, in Economics from Stanford University and an MBA from the University of Chicago Graduate School of Business. Mr. Cromack is currently a member of the board of directors of Hartz Mountain Corporation, a former Tri-Artisan portfolio company.
Gerald H. CromackCo-President+1 212 218 [email protected]
Mr. Manocha co-founded Tri-Artisan. Prior to Tri-Artisan, Mr. Manocha was a founding partner of Thomas Weisel Partners LLC. Prior thereto, he was a principal in the 1994 leveraged buyout of Furman Selz LLC, which was sold in 1997 to ING Group. Mr. Manocha remained with ING Group until the beginning of 1999, where he took responsibility of the North American private equity coverage and consumer, retailing and industrial mergers and acquisitions businesses. Prior thereto, Mr. Manocha worked at Lehman Brothers Holdings Inc. and was a founding member of its private equity coverage effort. Mr. Manocha began his career as a corporate and mergers and acquisitions attorney in New York and California. Mr. Manocha received a BS in Engineering and a JD from Columbia University. Mr. Manocha currently serves on the board of directors of Claire’s Stores, Inc., a Tri-Artisan portfolio company.
Rohit ManochaCo-President+1 212 218 [email protected]
Morgan Joseph TriArtisan Senior Management Biographies (cont’d)
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Ms. Malanoski is Vice Chair and Head of Investment Banking. She joined the firm in July 2001. From 1994 until June 2001, Ms. Malanoski was a Managing Director and the Chief Financial Officer of New Street Advisors LP, a private equity firm which she co-founded. New Street Advisors and its broker-dealer affiliate, New Street Investments, were primarily engaged in making investments in small capitalization companies for their own account and third party investors. Ms. Malanoski began her career at Drexel Burnham Lambert in 1980 in the Corporate Finance Department. She subsequently served in various positions, finally serving as Managing Director in the Mergers and Acquisitions Department and Chair of the Corporate Finance Underwriting Commitment Committee. Following Drexel's bankruptcy filing in 1990, Ms. Malanoski wasresponsible for formulating the firm's plan of reorganization, which was successfully consummated in 1992. She remained at the reorganized firm, which was renamed New Street Capital Corp., as a Managing Director responsible for many of the firm's merchant banking investments. Ms. Malanoski is a member of the Board of Directors of Phibro Animal Health Corp. Ms. Malanoski holds a B.A. degree in Mathematics from Rosemont College, and an M.B.A. from the Johnson School of Cornell University.
Mary Lou MalanoskiVice Chair Head of Investment Banking+1 212 218 [email protected]
Morgan Joseph TriArtisan Senior Management Biographies (cont’d)
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C. TMT Investment Banking Biographies
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Technology Investment Banking Team BiographiesMr. Juarez is a Managing Director in the firm’s Technology Investment Banking Group based in San Francisco. Mr. Juarez has more than 20 years of combined investment banking, strategy, and operations experience. He has advised on more than 50 public and private financings and merger and acquisitions representing more than $8 billion in transaction value capital for growth companies in the Internet and digital media, software, hosting and cloud services, and telecommunication sectors. Mr. Juarez was previously the Head of Investment Banking at Nollenberger Capital Partners, a boutique technology investment bank in San Francisco. Prior to Nollenberger, Mr. Juarez was the Managing Partner at AlphaCap, a merchant banking and advisory firm. Prior to AlphaCap, Mr. Juarez was a Managing Director at Robertson Stephens and Fleet BancBostson. At Robertson Stephens, he built the infrastructure software and services practice. In addition, he was a founding team member of two software companies and has been awarded multiple U.S. Patent Office software patents. Mr. Juarez has served on the Boards of private companies and was the author of the industry defining report titled “ Virtual Bricks”.Mr. Juarez received his B.S. in Finance, Magna Cum Laude, from California State University, Hayward and his M.B.A. from the Harvard Business School.
Rick Juarez
Managing Director+1 650 270 2702 [email protected]
Mr. Ramirez is a Managing Director at Morgan Joseph TriArtisan, bringing a strong combination of investment banking, operational, and strategic expertise to the firm, having advised a broad spectrum of emerging growth companies over the last 15 years. Before joining MJ , Mr. Ramirez held various management positions at Robertson Stephens & Co. in San Francisco, CA, and Southwest Securities in Dallas, TX. In addition, he has founded two enterprise software companies based in Austin, TX of which one was sold to Oracle in 2002. Mr. Ramirez has advised technology clients on approximately 40 public and private financings, mergers and acquisitions representing over $2.5 billion in transaction value. Mr. Ramirez has a deep background in the technology industry, primarily focused on emerging growth, middle-market companies.Mr. Ramirez holds a Bachelor of Arts degree in Economics with a specialization in Finance from the University of Texas at Austin.
Gene Ramirez
Managing Director+1 650 270 2703 [email protected]
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Mr. Beotra is a Director in the firm's Investment Banking group. Previously, Mr. Beotra was a Member of the Telecommunications Investment Banking group at ING Barings. He has worked on a number of advisory and financing assignments (both public and private) across a broad spectrum of industries. Mr. Beotra holds an MBA from the University of Maryland and a Bachelors Degree in Electronics and Communication Engineering from the Indian Institute of Technology (IIT).
Sandeep BeotraManaging Director+1 212 218 [email protected]
Mr. Fisher joined Morgan Joseph in December 2001. Prior to joining the firm, Mr. Fisher was a member of the Mergers and Acquisitions group at ABN AMRO. He began his career in investment banking as an Analyst in the Media & Entertainment group of ING Barings. Mr. Fisher received a B.S. in Finance with high honors from Lehigh University.
Zachary B. FisherPrincipal+1 212 218 [email protected]
Matthew McLeod is an Associate in the Investment Banking division at Morgan Joseph TriArtisan. Previously, Mr. McLeod worked at a boutique investment firm focused on the technology sector, and as an Associate at Lazard in the Technology, Media & Telecommunications group. Mr. McLeod began his career as a management consultant at Deloitte Consulting and Accenture.Mr. McLeod holds an M.B.A. from the University of Chicago, Booth School of Business and an undergraduate degree in Mechanical Engineering (Hons) and Computer Science from McGill University. He also completed post-graduate studies at the London School of Economics.
Matthew McLeod
Associate+1 650 270 [email protected]
Technology Investment Banking Team Biographies
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Technology Investment Banking Team Biographies
Anthony Cresci is an Associate in the Investment Banking division at Morgan Joseph TriArtisan. Previously, Mr. Cresci was an Investment Associate at UBS where he helped manage over 1b in assets. More recently Mr. Cresci was an Associate with Platinum Equity and Fortress Investment Group. He received his MBA with honors from USC Marshall School of Business and his BS with distinction from San Diego State University. Mr. Cresci is a CFA Charterholder.
Anthony J. Cresci, CFA
Associate+1 650 270 2704 [email protected]
Cody Werner is an Analyst in the Investment Banking division at Morgan Joseph TriArtisan. Previously, Mr. Werner was a financial analyst at FMV Opinions, where he worked on company valuations for fairness opinions, M&A advisory, and gift and estate tax. Mr. Werner graduated with a B.A. with distinction from the University of California, Berkeley.
Xuan Yang is an Analyst in the Investment Banking division at Morgan Joseph TriArtisan. Previously, Mr. Yang was an equity research associate at Broadpoint Capital and Canaccord Adams covering Advanced Materials companies. More recently, Mr. Yang was an equity research associate at Collins Stewart covering Digital Media and Semiconductor companies. Mr. Yang graduated with a B.A. with distinction from Vanderbilt University.
Cody Werner
Analyst+1 650 270 2708 [email protected]
Xuan Yang
Analyst+1 650 270 2707 [email protected]
Generating Revenue Globally: Opportunities in Europe
Questions & Answers
Generating Revenue Globally: Tapping into Markets Abroad