The number exits U.S.-based buyout shops completed through mergers or acquisitions fell during the third quarter from a year earlier, but disclosed valuation more than doubled. In fact, the largest exit in the third quarter (through Sept. 23, 2009) has a higher value than all of those with reported financial terms a year earlier.
Overall, there were 49 M&A exits by U.S. LBO firms from July 1 through September 23, 2009. The transactions with reported terms had a combined valuation of $1.99 billion. Last October, Buyouts reported 54 exits during the comparable period through Sept. 15, 2008, and the dozen with disclosed financial terms combined for only $953.5 million.
American Capital said on Sept. 16, that the total inception-to-date gain and income from its equity investment in Axygen Biosciences totaled $102 million. It received $182 million in proceeds and realized a gain of $35 million from the exit alone, subject to post-closing adjustments. The firm bought 80 percent of the biotechnology concern back in 2006.
Seven firms rung up at least two M&A exits during the latest period—see accompanying.
Meantime, three portfolio companies went public during the latest quarter through Sept. 25, compared to one a year earlier.
Avago Technologies Ltd. (AVGO) went public on Aug. 6, 2009, when it sold 43.2 million shares on Nasdaq for $15 a share. The chip designer and supplier has buyout backers in
Emdeon Inc., which is partly owned by
Select Medical Corp. held its IPO on Sept. 25, selling 30 million shares for $10 each. The IPO price came in below the estimated range of $11 to $13 and the hospital operator sold less than the 33.3 million shares it planned to offer. Its largest shareholder is
Besides the completed IPOs of the third quarter, buyout shops have been busy preparing to put other portfolio companies on track to go public. One of these is Education Management Corp. The university operator expects to price the offering between $18 and $20 a share on Oct. 1, with trading on Nasdaq to start the following day. The Pittsburgh, Pa.-based company intends to use proceeds to reduce its debt. Education Management’s private equity backers are