News Articles en-us /avcalnews Copyright 2014 AVCAL SB4: 60 16th Apr 14 April 2014 PE fact sheet now online <p><a href="" target="_blank">Read our latest fact sheet</a> which summarises the state of play in the Australian PE industry and current opportunities for investors.</p> 15th Apr 14 Read our latest policy and research update 10th Apr 14 PE-backed IPOs outperform the broader market: study 20th Mar 14 Financial System Inquiry is right to focus on venture capital funding 13th Mar 14 Submission: Review of the thin capitalisation arm's length debt test <p>Thursday 13 March 2014</p> <p>AVCAL today lodged a submission to the Board of Taxation commenting on its discussion paper titled &#39;Review of the thin capitalisation arm&#39;s length debt test&#39;.</p> <p><a href="" target="_blank">View the submission</a>.</p> 10th Mar 14 Review should recommend an expanded significant investor visa program 7th Mar 14 Significant investor visa reform announced <p>The Government announced a review will be undertaken to reboot the significant investor visa (SIV) programme to send a clear message that Australia is open for business and attract international investment to Australia in the competitive global market.</p> <p>Assistant Minister for Immigration and Border Protection, Senator the Hon Michaelia Cash said &#39;there will be particular emphasis on examining ways of enhancing greater flexibility and investment choices to significant investor visa applicants, as well as faster processing of applications for this visa. The review will also examine the possibility of introducing a new permanent visa stream for investment migrants.&rsquo;</p> <p>The internal review will be conducted in close consultation with the financial services industry and stakeholders.</p> <p><a href="" target="_blank">Read the Ministers announcement</a></p> <p><a href="" target="_blank">Read AVCAL&rsquo;s media release</a></p> 17th Feb 14 New AVCAL Working Group - WAVCAL <p>AVCAL is pleased to announce a new working group called &lsquo;Women in AVCAL&rsquo; (WAVCAL), established by the AVCAL Council. The focus of the working group will be to:</p> <ol><li>Increase participation of women in the industry at all seniority levels</li> <li>Increase identification and promote profiles of female participants in the industry</li> <li>Increase external awareness of of VC and PE as a career path for women</li> <li>Exploring programs that will achieve the above.</li> </ol> <p>AVCAL&#39;s Stakeholder Committees and Working Groups exist to examine industry issues and provide specific strategic advice and recommendations to the AVCAL Council and AVCAL CEO on matters pertaining to private equity and venture capital in Australia.</p> <p><a href="" target="_blank">View a list of AVCAL&#39;s committees and working groups.</a></p> 17th Feb 14 Future Direction Network names AVCAL Scholarship recipient <p>&nbsp;</p> <p>AVCAL&rsquo;s philanthropy partner, Future Direction Network (FDN) has announced its 2014 scholarship recipients. AVCAL is humbled to have one of the scholarships named the &lsquo;AVCAL Scholarship&rsquo; and another named after CHAMP. This recognises the contribution our industry has made to allow these scholarships to be awarded to assist young people go to university.</p> <p><a href="" target="_blank">Learn more about FDN</a>.</p> <p><a href="" target="_blank">Read more about FDN scholarship recipients</a>.</p> <p>Through AVCAL&#39;s partnership with FDN, we have assisted in contributing to the first FDN scholarship fund that resulted in $54,000 being committed to&nbsp;three&nbsp;young&nbsp;people in 2013 to help them reach their academic potential at university.&nbsp;AVCAL&rsquo;s&nbsp;aim is to&nbsp;continue to&nbsp;assist FDN to help them maintain a scholarship fund that will perpetually see nine students benefit each year from financial support. We are committed to helping change the lives of young people through FDN.</p> <p><a href="" target="_blank">Make a donation</a>.</p> 12th Feb 14 Thought leadership for Private Equity - Privcap interviews <p>A number of AVCAL members participated in an interview series organised by Privcap &ndash; a digital media channel for thought leadership in Private Equity. This was a key opportunity to educate a global audience of approximately 10,000 industry representatives about current trends and issues. Our Chief Executive, Yasser El-Ansary also participated in this interview series speaking on behalf of AVCAL as a voice for the industry as a whole, especially in relation to government policy. Videos of these interviews will be made available in the next few months.</p> 12th Feb 14 AVCAL submission: superannuation regulation and governance 11th Feb 14 AVCAL submission: APRA discussion paper 10th Feb 14 AVCAL submission to Treasury: ESS and Startups 30th Jan 14 Investment and innovation must take centre-stage in budget 20th Dec 13 Financial system inquiry is an opportunity to build a stronger future 17th Dec 13 Rebuilding consumer and business confidence starts today 16th Dec 13 Investing in innovation must be higher on the Government's agenda 13th Dec 13 Increased confidence in deal outlook for FY14: Deal Metrics Survey 5th Dec 13 AVCAL submission: Financial System Inquiry <p>AVCAL has lodged a submission to Treasury in response to the draft terms of reference for the proposed Financial System Inquiry that will be chaired by David Murray AO during 2014. The inquiry is an important platform for our industry to contribute to the public policy debate about how we can best position our economy for long-term prosperity, through key issues such as investment in non-listed entities and innovation.</p> <p><a href="" target="_blank">View the submission here</a>.</p> 3rd Dec 13 Private equity shows resilience: AVCAL 2013 Yearbook 28th Nov 13 We must invest more in innovation: AVCAL <p>AVCAL has lodged a submission to the National Commission of Audit. The submission presents the case for maintaining support for the Innovation Investment Fund (IIF) programme and the implementation of the 2013 McKeon Review recommendation for the establishment of a Translational Biotech Fund (TBF).</p> <p><a href="" target="_blank">View the submission</a></p> <p><a href="" target="_blank">View the media release</a></p> 26th Nov 13 AVCAL calls for urgent action on start-up investment tax issues <p>StartupSmart reports on AVCAL&#39;s recent meeting with the Office of the Assistant Treasurer this week which focused on two policy changes it views as critical for a robust investment sector to support start-ups. AVCAL Chief Executive Yasser El-Ansary told StartupSmart that Australia needs urgent action on these two policies.</p> <p><a href="" target="_blank">Read more</a></p> 25th Nov 13 Consultation on announced but un-enacted tax measures 21st Nov 13 AVCAL welcomes scope of financial system inquiry 25th Oct 13 Winners announced at Australian Growth Company Awards <p>As a proud partner of the second annual Australian Growth Company Awards, AVCAL congratulates the winners and finalists who were announced on 24 October in Sydney:</p> <ul><li>OzForex Pty Ltd for winning the Growth Company of the Year category</li> <li>Christopher Ride from Interactive Pty Limited for winning the Growth Company CEO of the Year category</li> <li>Five Am Life Pty Ltd for winning the Growth Company to Watch category, and</li> <li>Rafferty&rsquo;s Garden Pty Ltd for winning the Exit of the Year category.</li> </ul> <p>Congratulations to the finalists for each category who included: Appliances Online, Five D Holdings Pty Limited, Open Colleges Australia Pty Ltd, Rhino Rack Australia Pty Ltd, Wise Tech Global Pty Limited, Australian Portable Buildings Pty Ltd, Evolution Road Maintenance Group Pty Ltd,, NextGen Distribution Pty Ltd, Smart Business Telecom Pty Ltd, Nintex Group Pty Ltd and Virtus Health Limited.</p> <p>Nick Humphrey, Head of the Corporate Group at Sparke Helmore, said the 2013 award program &quot;really exceeded expectations&quot; this year and that it&#39;s &quot;a wonderful way to celebrate the successes of Australia&rsquo;s mid-market business leaders and innovators&quot;. The judging panel also commented that the quality of the nominations &quot;highlighted the breadth and strength of the Australian mid-market&quot;.&nbsp;</p> <p><a href="" target="_blank">View the media release here.</a></p> 24th Oct 13 Future Fund looks to private equity, alternatives <p>Investor Daily reports on recent figures released by Future Fund which shows a shift toward listed equity, infrastructure and private equity during the 12 months to 30 September. Future Fund currently manages $91.7 billion. The biggest mover in the portfolio is developed market equities, which rose to 23.9 compared to 17.7 per cent on 30 September 2012.</p> <p>Future Fund Chief Investment Officer David Neal said the fund&rsquo;s private equity investment in distressed or undercapitalised businesses coming out of the global financial crisis has been particularly successful: &ldquo;By employing very strong, bottom-up skills a number of [our] managers were able to identify those strong organisations &hellip; and build up exposures to very good companies at very cheap prices&rdquo;. But when it comes to the private equity and alternatives section of the portfolio, the Future Fund does not have a &quot;bucket&quot; to fill.</p> <p><a href="" target="_blank">Read the full article</a>.</p> 10th Oct 13 AVCAL appoints Chief Executive Officer 23rd Sep 13 Australia returns trump emerging Asia <p>In this article, Clare Burrows from Private Equity International shares key findings presented at AVCAL&#39;s 20th annual alpha conference last week, in particular that Australian private equity firms have generated better long term returns for LPs than emerging Asian managers. Data presented at the conference showed that over a 15-year period, Australian private equity has returned a rate of 14.3 percent to investors net of fees, while emerging Asia has only returned 8.8 percent. Over a three-year period the two returned 11.9 percent and 11.8 percent respectively.&nbsp;<br /> <br /> Managing Director and Global Head of Macquarie Investment Management Group, Michael Lukin said at the conference that &ldquo;What [the data] doesn&rsquo;t show is also [the volume of] exits. A lot of the returns that have been generated out of places like China and India are actually unrealised.&rdquo;</p> <p>Industry sources say that Australia&rsquo;s exit environment is good at the moment, with a buoyant IPO market and trade buyers coming in from abroad, however some say that investing in places like China is still attractive. A domestic LP who attended the alpha conference said: &ldquo;I think there is value provided you can find the right group. That group has to have certain connections at a political level, but they&rsquo;ve also got to have genuine investment and operating expertise. But then you also have to stop and [mix] that country exposure to a more regional strategy as well.&rdquo;</p> <p><a href="" target="_blank">View the relevant presentation slides from the alpha conference here.</a></p> <p><a href="" target="_blank">Read the full article.</a></p> 11th Sep 13 AVCAL/S&P Capital IQ Market Observations 2013 <p>AVCAL in association with data partner S&amp;P Capital IQ has released the 2013 Market Observations report today. The report looks at trends and developments in M&amp;A and private placements completed in Australia and New Zealand between FY2009 and FY2013, including the contribution of private equity to this activity.</p> <p>The report can be accessed <a href="" target="_blank">here</a>.</p> <p>For further discussion of the deal environment in the region, please see <a href="" target="_blank">Dealmaking activity in Australia and New Zealand - Financier Worldwide</a> (subscription required).</p> 22nd Aug 13 PE drives superfund outperformance <p>An article by Private Equity International reports on recent figures released by the Industry Super Network which show industry superannuation funds in Australia outperformed retail superannuation funds consistently over a ten-year period. Superannuation funds in Australia are private equity&rsquo;s biggest domestic source of capital. David Whiteley, Chief Executive of Industry Super Network, told&nbsp;Private Equity International&nbsp;that its exposure to the asset class &ldquo;certainly was a factor in our outperformance.&rdquo;&nbsp;&ldquo;Private equity has outperformed both international and domestic listed equities by between 50-100 basis points over the long term,&rdquo; he explained.&nbsp;</p> <p><a href="" target="_blank">Read the full article.</a></p> 14th Aug 13 Steady private equity still a long-term performer <p><strong>Investor Daily</strong></p> <p>AVCAL Chief Executive Katherine Woodthorpe talks to Investor Daily about the latest findings in the AVCAL/Cambridge Associates Q1 2013 performance benchmarks report that was released yesterday, that saw the Cambridge Associates LLC Australia Private Equity and Venture Capital Index (C|A Australia Index) post gains of 2.36%.</p> <p>&ldquo;Despite the challenging environment for exits, it is encouraging to note that private equity is generally delivering good returns to investors, particularly with realisations being top of mind for many limited partners at the moment,&rdquo; Ms Woodthorpe said.</p> <p><a href="" target="_blank">Read the full article here</a>.</p> 13th Aug 13 A solid start for Australian private equity in 2013 <p>The first quarter of 2013 saw the Cambridge Associates LLC Australia Private Equity and Venture Capital Index (C|A Australia Index) post gains of 2.36%, according to the latest quarterly report released by The Australian Private Equity and Venture Capital Association Ltd (AVCAL) today.</p> <p>The Q1 2013 Benchmark Statistics can be accessed <a href="" target="_blank">here</a>.</p> 2nd Aug 13 Government discussion paper on Employee Share Schemes & Start-up Co.s 12th Jul 13 Submission on Thin Capitalisation worldwide gearing test 9th Jul 13 Super funds look to alternatives to cut costs <p>Andrew Tsanadis, Super Review</p> <p>Based on a survey of the top 100 alternative asset managers globally over the year to December 2012, Towers Watson found that pension fund assets represent over a third (36 per cent) of total global assets under management for the asset managers surveyed, which reached $3.1 trillion in 2012.</p> <p><a href=";utm_medium=email&amp;utm_campaign=Super%20Review%20Newsletter%20MREC%20-%20send%20-%3E%209/07/2013%2012:43:00%20PM&amp;utm_content=" target="_blank">Read more</a>.</p> 8th Jul 13 Nominations open - Australian Growth Company Awards 2013 <p>AVCAL is a proud partner of the Australian Growth Company Awards. The awards are focused on celebrating excellence in the mid-market. They recognise companies that evidence high rates of growth as well as innovation, integrity, contribution to community and sustainable growth.</p> <p>We would like to invite you to consider nominating your company for an award in one of the award categories:</p> <ul><li>Growth Company of the Year</li> <li>Growth Company CEO of the Year</li> <li>Exit of the Year</li> <li>Growth Company to Watch (selected from the Growth Company of the Year nominations).</li> </ul> <p>Nominations close on 30 August 2013 and winners will be announced on 24 October 2013. To find out more and to nominate, <a href="" target="_blank">visit the Australian Growth Company Awards website.</a></p> 12th Jun 13 Government announces review of Employee Share Schemes for startups 11th Jun 13 York University academics win 2012-13 AVCAL VC research prize <p>Submissions open for 2013-14 prizes.</p> <p>AVCAL is pleased to announce the winners of the 2012-13 AVCAL VC Research Prize, Professor Douglas Cumming and Dr Sofia Johan of York University&rsquo;s Schulich School of Business, for their paper <a href="" target="_blank">&ldquo;Venture&rsquo;s Economic Impact in Australia&rdquo;</a>. The <a href="" target="_blank">2012-13 AVCAL PE and VC Research Prizes</a> are also now open for submissions. &nbsp;</p> 28th May 13 Venture capital carries a huge amount of the R&D spending in Australia <p>Venture Capital-backed firms spend more on research and development than industry peers, and while they only make up 0.01% of GDP they are responsible for around 10% of business R&amp;D spending in Australia.</p> <p>That&rsquo;s according to a new report released today by the Australian Private Equity &amp; Venture Capital Association, which said the research proves the VC industry was vital for true innovation in Australia.</p> <p>Read the full article <a href="" target="_blank">here.</a></p> 28th May 13 Venture capital vital for R&D and growth of Australian economy <p>Mercedes Ruehl, Australian Financial Review</p> <p>AVCAL chief executive Dr Katherine Woodthorpe says figures in a new report show the contribution the $2&thinsp;billion venture capital industry makes to the domestic economy.&nbsp;</p> <p>Venture capital-backed companies spend 200 times more on research and development than other companies and are ready to list on the stock exchange in half the time it takes those not backed by venture capital a new report shows.</p> <p>The report, commissioned by the Australian Private Equity and Venture Capital Association, also shows venture-capital backed companies make up 10 per cent of all business R&amp;D spending in Australia despite accounting for 0.01 per cent of gross domestic product. AVCAL chief executive Katherine Woodthorpe says the figures demonstrate the contribution the $2&thinsp;billion venture capital industry makes to the domestic economy.</p> <p>The report includes VC companies that failed.</p> <p>The 10 largest venture capital-backed companies, including ResMed, Cochlear and Seek, spent $1.4&thinsp;billion in R&amp;D between 2005 and 2011. But Australia&rsquo;s venture capital sector is contracting which will affect R&amp;D expenditure, future innovation and productivity.</p> <p>&ldquo;The Australian sector is shrinking in line with the global venture capital sector. The key problem is capital, there is not enough to go around,&rdquo; Dr Woodthorpe said. &ldquo;This was always hard but it was exacerbated by the global financial crisis.&rdquo;</p> <p>She said one of the issues is people don&rsquo;t necessarily understand the concept and its importance to the economy.</p> <p>&ldquo;There&rsquo;s been bits of narrative and case studies, but never a single comprehensive place to show the stories and the human face of what venture capital means,&rdquo; Dr Woodthorpe said.</p> <p>She said research proves venture &shy;capital-backed products and businesses have produced high economic and social returns per dollar invested. She argues that Australia &ldquo;can&rsquo;t rely on digging hills of iron ore and shipping lumps of black fuel over the world forever. We all know that&rsquo;s not a long-term sustainable future&rdquo;.</p> <p>The new economy will be formed from new industries and technologies.</p> <p>&ldquo;Venture capital plays a critical role in that innovation to grow our next economy. Without it there would be huge gaps in the innovation pipeline and the huge risk that we actually wouldn&rsquo;t achieve a sustainable future.&rdquo;</p> <p><strong>Global expansion attractive</strong></p> <p>There are around 500 venture capital-backed companies in Australia, compared with 24,000 in the United States.</p> <p>Brandon Capital Partners managing director Stephen Thompson said: &ldquo;The US has comparable statistics and it&rsquo;s nice to show that although we are a smaller market on a per capita size we [now] have similar stats to show that contribution of venture capital.&rdquo;</p> <p>The majority are from the life sciences and technology sectors. But online jobs site Seek is one of the best success stories of the domestic VC sector. In 1999, &shy;backers invested $2.5&thinsp;million as part of the company&rsquo;s first institutional capital raising. Today, Seek is worth more than $3&thinsp;billion and employs 500 staff.</p> <p>The trouble, said Southern Cross Venture Partners managing director Bob Christiansen, is that it&rsquo;s very hard for a company to win backing. Venture capital firms typically take on about 1&thinsp;per cent of the companies that make them a proposal, he said. &ldquo;We&rsquo;ve had 400 proposals in the past year and made four investments,&rdquo; Mr Christiansen said.</p> <p>Dr Woodthorpe conceded that another reason available funds have shrunk is because since the financial crisis, VC firms have been unable to exit prior investments in the five to seven-year time frame they&rsquo;d prefer.</p> <p>With capital hard to come by, investors will be even more selective about investments, and will look to back companies with a global reach.</p> <p>That means start-up companies have to be smart about explaining how they will sell to the wider market, even if they&rsquo;ve proved there is a need for their product.</p> <p>&ldquo;Ultimately we want to invest in companies that can be globally competitive, said Starfish Ventures founder Michael Panaccio.</p> <p>A product that can scale is essential, agrees Mr &shy;Christiansen.</p> <p>&ldquo;We want to know &lsquo;can it grow beyond being an interesting little company&rsquo; and that there are no inherent structural barriers to becoming a large company.&rdquo;</p> <p>Read the article <a href="" target="_blank">here.</a></p> 28th May 13 Australian VC punching above its weight <p>A report released today by the Australian Private Equity &amp; Venture Capital Association (AVCAL) shows that the Australian venture capital (VC) is pivotal to innovation in Australia, and VC-backed firms spend much more on research and development than their industry peers.</p> 24th May 13 StartupSmart discusses Australian PE investment returns <p>Private equity and venture capital investment in Australian businesses provides better returns than shares over the long term, according to the index by AVCAL and investment advisors Cambridge Associates. The index shows private equity provided returns of 6.88% and 2.83% over three and five years, while the S&amp;P/ASX 300 share market index produced returns of 2.8% and -1.81% respectively.</p> <p>In the year to December 31, however, shares outperformed private equity returns, with the S&amp;P/ASX 300 jumping by 19.74%, while private equity gained 5.78%.</p> <p>AVCAL chief executive Katherine Woodthorpe tells&nbsp;StartupSmart&nbsp;that private equity and business made good partners because both were focused on long term outcomes.</p> <p><a href="" target="_blank">Read more</a></p> 23rd May 13 Australian PE posts steady gains in 2012 <p>The Cambridge Associates LLC Australia Private Equity and Venture Capital Index (C|A Australia Index) showed steady gains in 2012, increasing by 5.78%, according to the latest quarterly report released by The Australian Private Equity and Venture Capital Association Ltd (AVCAL) today.</p> <p>The Q4 2012 Benchmark Statistics can be accessed <a href="" target="_blank">here</a>.</p> 15th May 13 PE leads listed markets over ten years - APEVCJ <p>Research from Cambridge Associates in partnership with AVCAL shows that private equity has outperformed public markets in Australia over a ten year period.</p> <p>Read the full article from the The Australian Private Equity and Venture Capital Journal <a href="" target="_blank">here</a>.</p> 15th May 13 Submission on Portfolio Holdings Disclosure by Superannuation Funds 7th May 13 Grant Thornton's Dealtracker 2013 report <p>Grant Thornton released a Dealtracker report which showed that Mergers and Acquisition (M&amp;A) valuation multiples have declined in the last 18 months reflecting a cautious approach to investment in difficult market conditions. However, despite lower transaction multiples overall, high multiples are being paid for companies with strong growth prospects.</p> <p><a href="/documents/item/589" target="_blank">View media release</a></p> <p><a href="" target="_blank">View the Dealtracker report</a></p> 26th Apr 13 Implications of AIFMD on GPs and LPs based outside Europe <p>This paper by the European Private Equity and Venture Capital Association (EVCA) provides an overview of the AIFMD&rsquo;s impact on both non-European GPs and LPs.</p> <p><a href="" style="font-size: 1em; line-height: 18px;" target="_blank">Read the EVCA AIFMD Third Country Paper</a></p> 5th Apr 13 NSW start-ups get $6.7 million innovation boost <p>By Oliver Milman</p> <p>This article reports on the NSW governments launch of &lsquo;Innovate NSW&rsquo;, a $6.7 million scheme aimed at backing start-ups in areas such as e-health, energy technology and services, online and interactive education, advanced manufacturing, transport, infrastructure and logistics.</p> <p>The article quotes Andrew Stoner, the state Deputy Premier and Minister for Trade and Investment, who says the initiative will provide local businesses with &nbsp;access to world-leading knowledge and capabilities and a low cost, low risk opportunity to trial and fine tune their solutions with major companies and government partners: &nbsp;&ldquo;the NSW government, NSW companies and researchers are working together to lead the way in identifying barriers to innovative growth, to generate new solutions, improve productivity and create new opportunities for NSW and Australian enterprises to compete in global markets.&rdquo;</p> <p>Applications are now open for Innovate NSW which comprises of four different funding components.</p> <p><a href="" target="_blank">Read more&nbsp;</a></p> 5th Apr 13 McKeon Review final report released <p>The Minister for Health has today released the final report of the <a href="" target="_blank">McKeon Strategic Review of Health and Medical Research</a>. The report includes a recommendation for the creation of a $250m Translational Biotech Fund, which was strongly endorsed by AVCAL in its <a href="" target="_blank">submission </a>to the McKeon Review in Oct 2012.</p> 4th Apr 13 Anchorage Capital Partners closes $250m fund <p>Sydney based private equity firm&nbsp;Anchorage Capital Partners today announced a A$250 million first and final closing of&nbsp;Anchorage Capital Partners II (the &ldquo;Fund&rdquo; or &ldquo;Fund II&rdquo;). The firm focuses on special situations and turnaround investment in the Australian, New Zealand and Southeast Asian markets. Significant interest from both existing and new investors meant that the Fund was oversubscribed and capped at A$250 million. Strong local market support was maintained with over 50% of Fund commitments sourced from Australian institutions.</p> <p><a href="" target="_blank">Read more</a></p> 2nd Apr 13 Make private equity a partner to give your business its best footing <p>Katherine Woodthorpe</p> <p>Small businesses face many challenges, not least of which is having the finance to achieve their potential and realise their founders&#39; vision.</p> <p>The banks are not renowned for their enthusiasm for small, relatively high-risk businesses. The founders&#39; capital (and ability to mortgage their home) has its limits, so where do they turn? Well, for many small businesses with strong growth potential, the answer may well be to turn to private equity funds.</p> <p>PE fund managers in Australia regularly invest in high-growth-potential smaller businesses. Indeed, despite the media&#39;s obsession with the big brand name PE deals, in Australia more than half of PE investments are into small and medium enterprises valued at under $50 million. A subset of these are owners wanting to expand their companies without giving up all their equity. PE investment can allow businesses to expand more rapidly than their working capital would otherwise allow and to take advantages of opportunities such as acquisitions to enable growth.</p> <p>Growth or &quot;expansion&quot; PE funds make up more than 60 per cent of the local PE industry and represent a valuable source of capital for SMEs looking to further expand. As well as enabling this growth, PE managers bring many other benefits to the partnership with entrepreneurs. In this growth segment, the founders usually retain a substantial and sometimes majority shareholding. The PE investors bring expertise, networks and transaction experience to strengthen the company. They are there to help grow the company. If agreed progress is made, then additional tranches of finance to enable the ongoing growth will be made available. And with a sizeable portfolio of investee companies, when additional finance is needed, they have the clout to negotiate better deals with the banks. PE managers make money for their investors (generally super funds and other pension funds) by increasing the underlying value in their investments. Again, contrary to the myths about PE, you don&#39;t make money by slashing and burning an investee company. You make it by increasing the underlying value so that an acquirer will see real value in the company. During the three years to June 2011, even in the immediate aftermath of the global financial crisis, PE exits as a whole generated $5.7 billion in proceeds for their investors from the original $3.7bn invested. In the same period, the S&amp;P/ASX 300 Accumulation Index showed an annualised return of just 0.26 per cent. The areas in which the PE fund is involved in assisting management fall into three broad categories: strategic thinking, financial aspects and operational management. They bring an experienced board of directors who can help with setting, critiquing and monitoring strategy as well as the relationships needed to achieve the company&#39;s goals. They bring financial expertise, structure and capital. And they bring operational expertise, access to additional executives, public company standards of reporting and good governance practices to give a company the best foundation to execute its strategy.</p> <p>One of the most powerful roles the fund manager fills, from what chief executives in PE portfolio have said, is a sounding board for someone whose interests are aligned with management&#39;s but who isn&#39;t working in the business directly. Many CEOs relate stories of speaking at least weekly or more often with their PE colleagues to sound them out about ideas and generally feel less alone at the helm. So PE investment can be a boon to rapidly growing SMEs to help the founders realise their vision.</p> <p><a href="" target="_blank">View the article</a></p> 27th Mar 13 Australia's venture capital scene ready to bloom: Ernst & Young <p>Harrison Polites</p> <p>Ernst &amp; Young&rsquo;s US technology sector leader Jeffrey Liu has said Australia&rsquo;s venture capital scene is on the cusp of a boom.</p> <p>Mr Liu said the problem of Australian entrepreneurs moving overseas due to better investment opportunities may solve itself as many Australian entrepreneurs in the US are currently looking at ways to bring their innovations back home.</p> <p><a href="" target="_blank">Read more</a></p> 27th Mar 13 $200 million funding to boost Aussie start-ups <p>At least $200 million will be invested into early stage, high growth Australian companies by three new venture capital funds supported by the Gillard Government&rsquo;s Innovation Investment Fund (IIF).</p> <p>The Minister for Climate Change, Industry and Innovation, Greg Combet, today announced three new funds selected under the latest tranche of the IIF, a key Government vehicle for providing small and medium sized enterprises with access to venture capital. He said $100 million of Government funding would be matched dollar for dollar by private sector investors in Carnegie Venture Capital Pty Ltd ($40 million), and GBS Venture Partners Pty Ltd and Innovation Capital Associates Pty Ltd ($30 million each). This is a huge boost for Australian start-ups, Mr Combet said. These funds will invest at least $200 million of new capital in start-up businesses.</p> <p><a href=";utm_medium=Website&amp;utm_campaign=Govt%2Binitiative" target="_blank">Read more</a></p> 21st Mar 13 Blue Sky backing for burrito chain <p>Gillian Tan</p> <p>Blue Sky Private Equity has invested more than $3 million in Australia-based Mexican restaurant chain Beach Burrito Company to help the company expand to up to 20-30 company owned restaurants in the next three to five years. Blue Sky Private Equity, which seeks to invest in rapidly expanding Australian companies, commended Beach Burrito&#39;s Managing Director Blake Read for building a profitable business in a time when many restaurants were closing down.</p> <p><a href="" target="_blank">Read more</a></p> 18th Mar 13 How to nurture our entrepreneurs <p>Tony Boyd discusses the launch of new venture capital fund, Blackbird Ventures, and evidence that in recent years, backing the technology and biotech entrepreneurs has delivered gains as large as those from the resources sector.</p> <p>The article also looks at the experience of Melbourne-based Starfish Ventures which shows that location is no barrier to international success in the digital space, citing examples from the Starfish Ventures portfolio such as Tmail and ICIX.</p> <p>The article notes it has been pleasing to see the Australian government provide strong support to the venture capital sector&rsquo;s three umbrella programs, the Innovation Investment Fund, Commercialisation Australia and the R&amp;D tax incentives. It is possible these will combine to help&thinsp;nurture the next digital entrepreneur in an age when technology is the country&rsquo;s biggest export, rather than coal and iron&thinsp;ore.</p> <p><a href="" target="_blank">Read more</a></p> 11th Mar 13 Australian private equity-backed firms bigger employers than banks <p>By Gillian Tan</p> <p>Australian banks may have a combined market value that dwarfs Germany&rsquo;s financial system, but an unsuspecting cohort trumps them as one of the nation&rsquo;s largest employers.</p> <p>Australian private equity-backed companies, such as Hoyts Entertainment Group and The Healthscope Group, together employ around 262,000 staff, according to a Deloitte Access Economics report.<br /> <br /> That&rsquo;s a larger employment figure than Australia&rsquo;s banking or automotive sectors, which respectively employed an average of 196,000 and 260,000 over the fiscal 2007-to-2011 period, according to the report commissioned by the Australian Private Equity and Venture Capital Association Ltd, or AVCAL.</p> <p><a href="" target="_blank">Read more...</a></p> <p>&nbsp;</p> 8th Mar 13 Private equity investment in Australia supports half a million jobs 7th Mar 13 Benefits of private capital under-estimated: Mercer <p>Superannuation funds should make a meaningful allocation to private capital to reap the rewards of a sophisticated private capital strategy, according to Mercer partner Ray King.</p> <p>King said that institutional investors had allocated quite a bit of money to private capital up until 2008, when the trend changed and allocations shrank.</p> <p>But opportunities abounded in market inefficiencies between private capital&#39;s sub-asset classes, he said.<br /> Mercer recommended a private capital allocation of 25 per cent concentrated in four sub-asset classes, King said.&nbsp;</p> <p><a href="" target="_blank">Read more</a></p> 21st Feb 13 Brandon Capital, Yuuwa Capital lead funding round for PolyActiva <p>Early stage company PolyActiva has received A$9.2m in funding thanks to a Series B fundraising round led by a consortium of investors including Brandon Capital and Yuuwa Capital. The Australian biotech firm said the funds will help further the preclinical and clinical development programs of its products under development. Funding came from angel investors, Yuuwa and Brandon&#39;s Medical Research Commercialisation Fund and Brandon Biosciences Fund 1.</p> <p><a href=";utm_campaign=362bb0dd27-AltAssets_Newsletter_2_20_2013&amp;utm_medium=email" target="_blank">Read more</a></p> 18th Feb 13 Business Today discusses venture capital with AVCAL CEO <p>Business Today host Whitney Fitzsimmons spoke with AVCAL CEO Katherine Woodthorpe about venture capital and how it can boost the Australian economy.</p> <p><a href="" target="_blank">Watch the interview</a></p> 18th Feb 13 Board of Taxation report into VCLPs released <p>Assistant Treasurer David Bradbury has released the Board of Taxation&#39;s <em>Review of taxation arrangements under the venture capital limited partnerships regime</em>.</p> <p>The Government agrees with all of the Board of Taxation&#39;s recommendations of these reviews in full or in principle. Changes requiring legislative amendments will take effect on Royal Assent.</p> <p><a href="" target="_blank">Board of Taxation&rsquo;s Review of taxation arrangements under the VCLP regime</a></p> <p><a href=";pageID=003&amp;min=djba&amp;Year=&amp;DocType" target="_blank">Read the Government&rsquo;s response</a></p> 18th Feb 13 AVCAL welcomes Government's Venture Australia initiative <p>AVCAL welcomes the Government&#39;s Innovation Statement announced on 17 February 2013 and its focus on developing the jobs of the future for Australia.</p> <p>We are particularly pleased to see the recognition of the importance of the Venture Capital industry to enable Australia&rsquo;s innovations turn into products, processes and services that add to the economy and provide jobs in the future.</p> <p><a href="">Read more</a></p> 7th Feb 13 Australian PE continues to post steady returns in Q3 2012 7th Feb 13 Valmont Industries to acquire Locker Group from Advent Capital - WSJ <p><em>By Gillian Tan</em></p> <p>Mid-market PE firm Advent Private Capital has announced the sale of Locker Group Holdings to US-based Valmont Industries. Exit from the construction and architectual product manufacturer is expected to generate a return of over 2.5 times for Advent&#39;s investors. Since Advent purchased Locker Group in 2006, it completed a number of manufacturing, warehousing, procurement and IT operations improvements to successfully grow the business.</p> <p><a href="" target="_blank">Read article</a></p> 1st Feb 13 Venture capital scheme to back tech start-ups - SMH <p><em>By Mahesh Sharma</em></p> <p>AVCAL member Starfish Ventures&rsquo; partner Tony Glenning speaks to Fairfax Media&#39;s <em>IT Pro</em> about launching Techfund III later in 2013, which will be used to invest between $3 and $15 million in established tech start-ups. The $100 million fund will succeed Starfish&rsquo;s $185 million Techfund II and will provide capital to several web and mobile companies. Last year Starfish invested around $30 million in 10 companies including Scriptrock, Atmail and MetaCDN.</p> <p><a href="" target="_blank">Read the article</a><br /> &nbsp;</p> 17th Jan 13 NBC Capital invests in Degani Bakery Cafe chain - Startup Smart <p><em>By Michelle Hammond</em></p> <p>Brisbane-based private firm NBC Capital has invested in the Victorian-based Degani Bakery Caf&eacute; chain. The chain, which sells cakes, muffins, pies and coffees, started in 2000 as one store and has since grown to almost 60 stores. NBC Capital will use its expertise, including that gained from owning and operating Eagle Boys, to help grow the company and identify new opportunities.</p> <p><a href=" " target="_blank">Read the Startup Smart article</a><br /> &nbsp;</p> 16th Jan 13 PE and the efficient DC portfolio - Pensions & Investments <p><em>By Kevin K. Albert</em></p> <p>A portfolio that includes private equity among the asset mix can benefit from a greater number of risk-adjusted returns compared with those made mostly of bonds and public equities. Private equity can help reduce a portfolio&rsquo;s systematic risk, while still maintaining expected returns. This shows, the author states, how the inclusion of private equity in a defined contribution plan can create a more efficient portfolio and generate sustainable alpha.</p> <p><a href=" " target="_blank">Read the article</a><br /> &nbsp;</p> 16th Jan 13 The Riverside Company invests in Bohemia Interactive Simulations <p>AVCAL member The Riverside Company has invested in Bohemia Interactive Simulations, a provider of simulation technologies and integrated training solutions for military and civilian organizations. Founded in Australia in 2001, Bohemia supplies the Australian Defence Force, U.S. Department of Defence, UK Ministry of Defence and a range of international clients. Riverside will use its global footprint and knowledge of the software industry to help Bohemia expand and better meet clients&rsquo; needs.</p> <p><a href=" " target="_blank">Read media release</a></p> 12th Dec 12 Harbert acquires majority stake in Cardioscan <p>AVCAL member Harbert Australia Private Equity has acquired a substantial majority interest in Cardioscan Services, a provider of cardiac testing services to large Australian pathology and hospital groups. Harbert&rsquo;s experience and financial capacity will help Cardioscan bolster its operational capabilities, expand its management team, execute newly won contracts and meet service levels for key customers. Harbert, a private equity firm targeting lower-middle market investments, will also support the company&rsquo;s aspirations for medium term expansion.</p> <p><a href="/documents/item/462" target="_blank">Read media release</a></p> 5th Dec 12 AVCAL submission on taxing trust income 27th Nov 12 FDN Chairman Corey Payne takes top award <p>AVCAL congratulates Corey Payne, the Chairman of AVCAL&rsquo;s philanthropy partner <a href=" " target="_blank">Future Direction Network</a> (FDN), for last name being named the <a href=" " target="_blank">NSW Young Australian of the Year 2013</a>.</p> <p>Corey, a 28 year old footballer with the Canterbury Bulldogs, helped found FDN in 2009 with the aim of encouraging students from low socio-economic backgrounds to attend university.</p> <p>AVCAL is supporting FDN to help raise a $500k scholarship fund to provide three students six thousand dollars annually to complete their studies. Since the September 2012 <strong>alpha</strong> conference, FDN has raised more than $120k from a number of individuals and corporates including CHAMP Ventures, CHAMP Private Equity, Archer Capital, Greenstone Partners and AVCAL. You can donate to FDN using this <a href=" " target="_blank">secure, online link</a>.</p> <p>Corey holds an undergraduate commerce degree with the University of Sydney and is currently completing his Master of Commerce. He is a graduate of the Australian Institute of Company Directors and was awarded the prestigious Churchill Fellowship in 2012.</p> <p>Corey&rsquo;s achievements both on and off the field have been remarkable and AVCAL is pleased to see Corey receive this accolade.</p> <p><a href=" " target="_blank">Donate to FDN</a></p> <p><a href=" " target="_blank">Read media release</a><br /> &nbsp;</p> 20th Nov 12 Anacacia Fund II reaches $125m <p>AVCAL member Anacacia Capital has raised $125m for its Anacacia Fund II, after its $80m first close in July. Investors in the fund, which has not called for a final close yet, include Australian superannuation and pension funds, and international fund-of-funds. Anacacia intends to make up to 12 investments over a 10-year period with the funds.</p> <p><a href="" target="_blank">Read more</a></p> 20th Nov 12 Starfish Ventures invests in email company Atmail <p>AVCAL member Starfish Ventures has today announced it will invest $2m into the Australian-based email and web communication company Atmail. The capital will help drive product development, expand the technical team, and increase its US, Asia and European focus. Atmail&rsquo;s proprietary email product is currently used by over 40 million paid mailboxes, and 4,500 customers.</p> <p><a href="/documents/item/456" target="_blank">Read media release</a><br /> &nbsp;</p> 19th Nov 12 BRW â How you can fund future growth <p>This BRW article by Matthew Smith investigates how private equity can help fund growth in Australian SMEs. It looks at how private equity investment in Australian businesses such as personal care brand Aesop and local sportswear line Lorna Jane has significantly helped to drive growth in stores and revenues, and enabled them to expand overseas.</p> <p><a href="" target="_blank">Read article</a></p> 9th Nov 12 KKR and Allegro acquire portfolio of loans from BOS International <p>Global investment firm Kohlberg Kravis Roberts &amp; Co L.P. (KKR) and independently-owned Australian fund manager Allegro Funds have signed an agreement to acquire a portfolio of commercial loans from BOS International. The acquisition for an undisclosed amount follows a competitive process run by BOS International, a subsidiary of Lloyds International Pty Limited, following a review of its Australian and New Zealand commercial loan portfolio.</p> <p><a href="/documents/item/452" target="_blank">Read media release</a></p> 9th Nov 12 The Riverside Company acquires eLearning company Learning Seat <p>Global private equity firm The Riverside Company has acquired Learning Seat, a Melbourne, Australia-based developer and provider of eLearning courses. The company, previously a division of News Limited, has offices in Melbourne, Sydney, Brisbane and Adelaide. Riverside plan to work closely with Learning Seat on new product development, expanding sales and market, and leveraging Riverside&rsquo;s global connections and talent. This is Riverside&rsquo;s third investment in Australia.</p> <p><a href=";c=34&amp;l=2&amp;ctl=19B:A67FEBDAC00B0813AE39EFE447DC20AA&amp;" target="_blank">Read media release</a></p> 9th Nov 12 PE News - Buyout industry feels lure of Australia <p>Australia&rsquo;s reputation as an attractive place for private equity deals, has been reinforced by research showing that Australia&rsquo;s private equity industry outperformed the public market in the 12 months to June 2012. The Cambridge Associates Australian Private Equity and Venture Capital Index, released in partnership with AVCAL, found that private equity numbers were better than the public market over five years. The research coincides with an announcement by Denham Capital, a US private equity firm focused on energy and resources, that it will open an office in Australia.</p> <p><a href="" target="_blank">Read article</a></p> <p><a href="" target="_blank">Read Cambridge Associates Q2 2012 report</a></p> 7th Nov 12 Australian private equity outperformed S&P/ASX 300 by 10% in Q2 2012 1st Nov 12 Private equity fundraising rebounds with foreign investor support <p><br /> &nbsp;</p> 31st Oct 12 Public-to-private transactions: Public equity at your door <p>Read about industry experts&rsquo; views on the key challenges and opportunities relating to public-to-private (P2P) transactions in this transcript from a recent King &amp; Wood Mallesons event. Attended by representatives from listed companies, private equity firms, institutional investors and managers, the group discussed how the current market conditions make P2Ps an attractive option.</p> <p><a href="" target="_blank">Read more</a></p> 31st Oct 12 New IPEV Investor Reporting Guidelines <p>The International Private Equity and Venture Capital Investor Reporting Guidelines (October 2012 edition) have been released. These supplement the AVCAL Reporting Guidelines.</p> <p><a href="" target="_blank">View guidelines</a></p> 31st Oct 12 AVCAL submission on health and medical research in Australia <p>&nbsp;</p> 24th Oct 12 Asst Treasurer releases "Taxing Trust Income" policy options paper <p><br /> &nbsp;</p> 18th Oct 12 StartupSmart â MetaCDN snags $2.3M investment <p>AVCAL member Starfish Ventures have led an investment round to secure $US2.3million for MetaCDN, a cloud-based content delivery service. The start-up, which began in Melbourne University, will use Starfish&rsquo;s support to expand their sales and development teams and grow their international customer base. The investment is Starfish&rsquo;s most recent backing for an Australian start-up.</p> <p><a href="$2.3-million-investment/201210177903.html" target="_blank">Read more </a><br /> &nbsp;</p> 15th Oct 12 Silicon Valley support for NSW companies <p>NSW Trade &amp; Investment&rsquo;s new <a href="" target="_blank">Business Office in San Francisco</a> recently marked its official opening with a pitching event showcasing a range of NSW startup companies to California businesspeople and investors.</p> <p>Director, NSW Trade &amp; Investment, North America Jason Seed and the new office are focussed on driving investment and promoting exports and the research and development capabilities of NSW&rsquo;s key sectors, including digital, ICT and financial services.</p> <p>The office has already worked with numerous NSW technology startup companies trying to get a foothold in Silicon Valley, providing advice on the local market and networks as well as access to its fully equiped office space in the San Francisco Bay Area.</p> <p>For more information please contact <a href="" target="_blank">NSW Trade &amp; Investment, North America</a>.</p> 8th Oct 12 AFR â Now is the time to invest in private capital <p><em>By Paulina Duran</em></p> <p>In this AFR article, Rene Biner from Partners Group talks about the benefits of investing in private equity in the current economic climate. He says that investors faced with rising inflation rates in the medium term can protect themselves by investing in private capital markets. The best Australian PE firms, the article cites, have been successful with their fund-raising and sourcing good opportunities. This strong deal-flow is also expected to increase the demand for local debt.</p> <p><a href="" target="_blank">Read more</a> (Note: an AFR subscription is required to view the full article)<br /> &nbsp;</p> 8th Oct 12 Treasury consultation on ASIC takeover proposals 5th Oct 12 Sale of Hastie Services group of businesses completed <p>Industrial services group Hastie Services, formerly part of the Hastie Group, was sold this week to a management buyout team led by the current CEO Roger Jowett. Sydney-based private equity group Allegro Funds also supported the sale. Chester Moynihan, Allegro Fund&#39;s Managing Director, has been appointed chair of the new entity, TSC Group Holdings, and says they look forward to working closely with the management team to add further value.</p> <p><a href="/documents/item/432" target="_blank">Read the media release</a></p> <p>&nbsp;</p> 26th Sep 12 First investment by Southern Cross Renewable Energy Fund <p>The Southern Cross Renewable Energy Fund is making its first investment to a QLD company with novel technology that increases the efficiency of solar panels. Brisbane Materials will use the $1.5 million investment, along with $2.5 million from USA-based New Ventures Partners, to commercialise its high-performance, anti-reflective coatings. Southern Cross Venture Partners secured the additional investment and will provide investment management assistance to the company during the commercialisation process.</p> <p><a href="" target="_blank">Read more</a></p> 25th Sep 12 AVCAL submission to Business Tax Working Group discussion paper 24th Sep 12 StartupSmart - Australia second only to US in start-up stakes <p>New research by the Australia Centre for Entrepreneurship has found that one in ten Australians was involved in starting and running new businesses in 2011. This start-up rate was higher than other developed countries apart from the United States, painting a healthy image of Australia&rsquo;s economy. This entrepreneurship is expected to create jobs in the consumer-oriented or business services sectors, with a third of the early stage entrepreneurs expecting to create over five new jobs within the coming five years.</p> <p><a href=";utm_campaign=30b363a690-Monday_24_+September_2012&amp;utm_medium=email" target="_blank">Read more </a><br /> &nbsp;</p> 24th Sep 12 AVCAL 2012 award winners announced 17th Sep 12 AVCAL submission on fixed trusts 12th Sep 12 Oil Industry Catering scores a $3m investment from Blue Sky <p>Blue Sky Alternative Investment has acquired a stake in Oil Industry Catering and Services, a company that provides catering and support services to the mining industry. The $3m capital investment will be used to purchase infrastructure to offer turnkey solutions to clients. Oil Industry Catering currently has 145 staff across Australia, serving clients across 20 to 30 sites.</p> <p><a href="" target="_blank">Read more</a><br /> &nbsp;</p> 7th Sep 12 Wolseleyâs Guardian acquires Jigsaw Corporate Childcare <p>Wolseley&#39;s Guardian Childcare Alliance has expanded by acquiring Jigsaw Corporate Childcare, Australia&rsquo;s leading provider of corporate childcare solutions. The Jigsaw Corporate Childcare group (Jigsaw) owns and operates 10 high quality early learning centres for the staff of a number of blue chip corporate clients. The acquisition is the latest step in Guardian&rsquo;s growth strategy, which has resulted in the business doubling in size since Wolseley invested in the business 18 months ago.</p> <p>Guardian operates 74 high quality centres providing daily care for more than 11,000 families, with about 6,200 licensed childcare places and 1,500 early learning educators. Group turnover now exceeds $100 million a year.</p> <p>Michael Murphy, Director at Wolseley, said: &ldquo;We are excited about the opportunity to support Guardian in its plans to expand into the corporate childcare market. There is significant demand from Australian companies for high quality early childhood education for their employee&rsquo;s children and many businesses now see onsite childcare as a key tool in attracting and retaining staff.&rdquo;</p> <p>&ldquo;We expect corporate childcare to be a focus of significant growth for Guardian and we will continue to support the business to capitalise on these opportunities. Guardian intends to expand the Jigsaw business by seeking further opportunities in Sydney, as well as expanding into the Canberra, Melbourne and Brisbane markets as appropriate sites become available.</p> 31st Aug 12 AVCAL submission on R&D quarterly tax credits 24th Aug 12 BRW - Why Australian start-ups don't need to go to Silicon Valley <p><em>By Jessica Gardner</em></p> <p>This Business Review Weekly article talks about how Australia entrepreneurs can benefit from lower operating costs by remaining locally-based. The experience of the Australian software company Atlassian shows how technology start-ups can successfully start global operations in Australia. Other advantages cited include easy access to engineering talent, cheaper developers and government support for start-ups.</p> <p><a href="" target="_blank">Read more</a></p> 24th Aug 12 McGrathNicol - Thin cap rule potential changes and solutions <p>In response to the possible changes identified by the Federal Government&rsquo;s Business Tax Working Group on the thin capitalisation regime, McGrathNicol has published a <a href="/documents/item/412">paper</a> describing tax-saving solutions for companies potentially facing reduced tax deductibility of interest.</p> <p>For more details, go to our Members Policy Portal (you will need to be <a href="">logged in</a> to access this).</p> 14th Aug 12 Business Tax Working Group discussion paper released 8th Aug 12 Financier Worldwide - Expansion PE in Australia <p><em>By Katherine Woodthorpe</em></p> <p>AVCAL CEO Katherine Woodthorpe&rsquo;s article in this Private Equity Special Report outlines the growth opportunities present in the Australian market. Despite difficult economic times, Australian expansion funds still present a strong opportunity for investors seeking alpha. The Australian market provides similar opportunities to neighbouring emerging markets, while providing the mature and stable regulatory climate of a developed economy.</p> <p><a href="/documents/item/401" target="_blank">Read more</a><br /> &nbsp;</p> 7th Aug 12 Leading Company - The anatomy of a private equity deal <p><em>By Kath Walters</em></p> <p><em>Leading Company</em> talks to AVCAL CEO Dr Katherine Woodthorpe on how private equity helps companies grow. Mark Youens, the joint head of Gresham Private Equity, also talks about the recent trade sale of clothing retailer Witchery Group to Country Road and how, since buying Witchery in 2006, Gresham Private Equity has engaged in value-adding activities to triple its number of stores and grow net profit.</p> <p><a href="" target="_blank">Read more</a></p> 31st Jul 12 Government releases discussion paper on fixed trusts 25th Jul 12 Privcap - How MLCOA and Riverside partnered for growth <p>This video case study on the Privcap website explains how AVCAL member Riverside worked with Australian healthcare services company MLCOA to transform the business and culture from a previously founder-driven organisation, and to take the company to the next level. In this interview, Robyn Walsh, the CEO of MLCOA and Simon Feiglin, a partner at The Riverside Company discuss how Riverside worked with the company CEO to professionalise the operations at MLCOA, and how they supported a key add-on acquisition to the company.</p> <p><a href="" target="_blank">View the video</a> (note: you must complete a free online registration with Privcap to watch this)<br /> &nbsp;</p> 16th Jul 12 AVCAL Submission to Senate Inquiry on Cross Border Transfer Pricing <p>16 July 2012</p> <p>Read AVCAL&#39;s submission to the Senate Standing Committee on Economics&#39; inquiry into the Tax Laws Amendment (Cross Border Transfer Pricing) Bill (No. 1) 2012.</p> 13th Jul 12 WSJ - Archer Capital raises $300 million <p><em>By Gillian Tan</em></p> <p>Archer Capital Growth Funds has closed its Archer Growth Fund 2 at $300 million, 12 months after starting the raising. The fund, raised without the use of a placement agency, exceeds its original $250 million target by $50 million.</p> <p><a href="" target="_blank">Read more</a> (note: The Australian subscription is required to view the full article)<br /> &nbsp;</p> 13th Jul 12 Merkle acquires mobile solutions provider 5th Finger <p>Starfish Ventures&rsquo; mobile technology company 5th International Group, known as 5th Finger in the US, has been acquired by Merkle, a customer relationship marketing agency. Merkle will use the acquisition to expand its capabilities in mobile to drive better customer engagement and value.</p> <p><a href="" target="_blank">Read the media release</a></p> 11th Jul 12 AVCJ - Q&A with Pacific Equity Partnersâ Tim Sims <p><em>By Tim Burroughs</em></p> <p>In this Asian Venture Capital Journal article, the co-founder and managing director of Pacific Equity Partners, Tim Sims, talks about the value opportunities present in the Australian market. He also talks about the incorrect perception that the Australian economy relies too much on Chinese growth.</p> <p><a href="" target="_blank">Read more</a><br /> &nbsp;</p> 11th Jul 12 Harbert acquires stake in FastTrack <p>Harbert Australia Private Equity has acquired a majority equity stake in FastTrack, the largest provider of recruitment software to the Australasian recruitment industry. The capital injection will be used to drive growth by establishing offices overseas, strengthening product development and innovation, and providing more training opportunities for staff.</p> <p><a href="" target="_blank">Read the media release</a><br /> &nbsp;</p> 11th Jul 12 Clean Technology Innovation Program launched <p>The Minister for Industry and Innovation, the Hon Greg Combet AM MP, has launched the Clean Technology Innovation Program. The $200 million program consists of merit-based grants that support innovative clean technology projects and associated services.</p> 10th Jul 12 Charities investing more in private equity <p><em>By Joanna Glasner</em></p> <p>A survey of 147 institutions by investment manager Commonfund has found that private equity holdings in foundations rose significantly in the last year. This follows a long-term pattern of foundations increasingly investing in alternative strategies. The survey shows that in 2011, private equity accounted for around 25% of alternative investments, while venture capital represented 8% of alternatives.</p> <p><a href="" target="_blank">Read more</a><a href="" target="_blank"><br /> Read the Commonfund report</a><br /> &nbsp;</p> 5th Jul 12 AVCJ - Anacacia Fund II reaches $75m first close <p><em>By Alvina Yuen</em></p> <p>AVCAL member Anacacia Capital has raised $75 million in the first close of its Anacacia Fund II. This was achieved within weeks of opening and represents 50% more than its initial target. Contributing investors include superannuation funds, fund of funds and family offices in Australia.</p> <p><a href="" target="_blank">Read more</a> (note: AVCJ subscription is required to view the full article)<br /> &nbsp;</p> 3rd Jul 12 CHAMP Ventures closes fund at A$475M <p>AVCAL member CHAMP Ventures has announced the closing of its seventh fund at A$475 million, which surpasses its targeted &lsquo;hard cap&rsquo; by A$25 million. This equates to a 58% fund increase compared with CHAMP Ventures&rsquo; sixth fund, which closed in April 2006 at A$300 million. The fund has a balanced and diversified investor base, and will be used to invest in the Australasian lower mid-market.</p> <p><a href="/documents/item/379" target="_blank">Read more</a><br /> &nbsp;</p> 26th Jun 12 With pension fund investments, private equity pays off <p>In this article, Keith Larson and Ted Wheeler of the Oregon Public Employees Retirement Fund talk about the fund&rsquo;s strategy to deliver value to its members by investing in private equity.</p> <p>Since 1981, private equity has been the fund&rsquo;s top performer: if Oregon had not invested in private equity over the past decade and instead put the money in the stock market, it would have had $4 billion less in earnings, or $400 million less every year &ndash; the equivalent of losing 4,000 teachers per year.</p> <p>Over the past decade, about 71% of the money needed to pay for benefits came from investment-generated income: a large part of which was attributable to Oregon&#39;s decision to invest in private equity.</p> <p>&ldquo;We are unanimous in our belief that the trade-offs of private equity are worth it for Oregon and are key to the sustainability of PERS,&rdquo; say the authors.</p> <p>&ldquo;The performance of these investments strengthens our ability to fund schools, public safety and other critical services, with less money coming out of taxpayers&#39; pockets.&rdquo;</p> <p><a class="external" href="" target="_blank">Read more</a><br /> &nbsp;</p> 18th Jun 12 OneVentures leads $1.5M series-A financing for Paloma Mobile <p>AVCAL member OneVentures has invested in Sydney-based startup Paloma Mobile to help grow its smartphone services in Southeast Asia, Latin America and other markets. Paloma Mobile is targeting the expected 1 billion users of smartphones by 2014 with its data-efficient services. OneVentures partner Anne-Marie Birkill said the firm is excited to support Paloma with its excellent track record of creating and exiting companies.</p> <p><a class="external" href="" target="_blank">Read more</a></p> 18th Jun 12 The Australian discusses private equity <p><em>By Michael Bennet</em></p> <p>This article in The Australian discusses the finding of PriceWaterhouseCoopers&rsquo; first report on private equity, that this funding source provides opportunities for businesses to grow and gain competitive advantages. Jonathan Kelly, a director of Champ Ventures, encourages small and medium businesses to consider the advantages of private equity such as an alternative funding source and succession planning. Harbert Australia Private Equity senior managing director Jeremy Steele also talks about the extra rigour and discipline that private equity can offer.</p> <p><a class="external" href="" target="_blank">Read more</a> <a class="external" href="" target="_blank"><br /> PwC/AVCAL report: How can fresh insights add greater value?</a><br /> &nbsp;</p> 6th Jun 12 AFR â Get to know growth private equity <p><em>By Paulina Duran</em></p> <p>A PwC study of 1,000 private businesses has found that a large number of middle-sized businesses require expertise and additional capital to drive growth. In this Australian Financial Review article, PwC Private Clients Partner Alan Elliott talks about the value of private equity as a source of capital and in succession planning. Managing Partner of Wolseley Partners, Andrew Petering, also speaks about the value of private equity in driving small and medium-sized businesses&rsquo; growth.&nbsp;</p> <p><a class="external" href="">Read more</a> (note: an AFR subscription is required to view this article)<a class="external" href=""><br /> PwC/AVCAL report: How can fresh insights add greater value?</a><br /> &nbsp;</p> 1st Jun 12 Hawkesbridge acquires Colemans Group <p>AVCAL member Hawkesbridge Capital have acquired a significant equity interest in&nbsp;Colemans Group, the largest perimeter security and commercial fencing infrastructure business in NSW. Hawkesbridge Capital will work with Colemans to create a national operational footprint and capitalise on major infrastructure opportunities.</p> <p><a href="">Media release</a></p> 30th May 12 AFR - In defense of private equity <p><em>By Jonathan Shapiro </em></p> <p>Urs Wietlisbach, the executive vice-chairman of Swiss-listed investment house Partners Group, talks to the Australian Financial Review on the common misconceptions about private equity and provides a robust, research-backed response on the role of private equity within an economy and its outperformance compared to the public market.</p> <p><a href="">Read more</a></p> 29th May 12 Direct Capital completes its sale of GoBus <p>AVCAL member Direct Capital has sold their shareholding in GoBus Holdings Limited to AVCAL member Next Capital as part of a recapitalisation plan to continue the company&rsquo;s growth. Direct Capital acquired GoBus in 2007, and since has more than doubled its fleet of vehicles. GoBus now employs more than 950 staff.</p> <p><a href="" target="_blank">Media release</a></p> 29th May 12 New visa for VC-backed entrepreneurs introduced <p>25 May 2012<br /> Minister Bowen announced reforms today to the Business Skills program - now named the Business Innovation and Investment program. These reforms start from 1 July 2012. They include the introduction of a new Business Talent visa to facilitate the entry of migrant entrepreneurs with a high-potential business idea. Migrant entrepreneurs must have sourced at least AUD1 million in venture capital funding through an AVCAL member. The funding should be provided for early phase start-up, product commercialisation, or business development and expansion.<br /> <br /> &nbsp;</p> 21st May 12 Who will win the super fight? <p>Industry super funds AustralianSuper and SunSuper manage super mandates for some large organisations such as Boeing, Toshiba, Elders, and IBM. Today, over 30% of the S&amp;P/ASX 200 is owned by superannuation funds, and these funds are facing increasing pressure to diversify. AVCAL CEO Dr. Katherine Woodthorpe reaffirms the strong performance of the Australian private equity industry relative to public equities, and that private equity&rsquo;s underperformance fears are not justified.</p> <p><a href="">Read more</a>.<br /> &nbsp;</p> 14th May 12 Post-Budget update on tax issues (members only) 7th May 12 Starfish Ventures invests $2M in Scalify <p>AVCAL member Starfish Ventures has invested $2m in Australian technology start-up, Scalify. Scalify, which provides networking technology designed for fast and efficient creation of multi-user applications, comes as a results of years of research and development at Australia&rsquo;s ICT centre of excellence, NICTA. Scalify&rsquo;s core technology product, Badumna, was launched last year and is now used to power games across the US, Europe, and Asia.</p> <p><a href="" target="_blank">Media release</a><br /> &nbsp;</p> 2nd May 12 PwC report on Private Equity Growth Funds 1st May 12 2012 BRW Fast Starters - A meeting of minds <p>Three companies backed by AVCAL member, Anacacia Capital, are among the 2012 BRW Fast Starters companies. They include premium baby food manufacturer <em>Rafferty&rsquo;s Garden</em>, global supplier of languages services to technology companies and government agencies <em>Appen Butler Hill</em>, and supplier of affordable high quality appliances <em>Home Appliances</em>.</p> <p><a href="">Read more</a>.</p> 27th Apr 12 Push for more private equity in Super <p><em>By Damon Kitney, The Australian</em></p> <p>AVCAL&rsquo;s chair David Brown highlights the importance of a larger and more appropriate allocation to private equity by local super funds in his most recent interview with The Australian. David talks about the MySuper legislation, the increase in superannuation guarantee, and programme implementation issues among superannuation funds and their negative effect on the local private equity industry. David also stressed on the solid performance the local private equity has demonstrated compared to their public market benchmarks.</p> <p><a href="">Read more</a>.</p> 18th Apr 12 AVCAL VC members win global award <p>By Michelle Hammond at startupsmart</p> <p>AVCAL member and Australian venture capital firm OneVenture received the Best Venture Investment at the 2012 Vaccine Industry Excellence Awards in Washington for their investment in Vaxxas. Developed by Dr. Mark Kendall, Vaxxas developed a needle-free system to deliver vaccine directly into the patients&rsquo; skin. The investment syndicate also included AVCAL member Brandon Capital Partners.</p> <p><a href="$15-million-investment-in-biotech-start-up-wins-global-award/201204176024.html" target="_blank">More</a><br /> &nbsp;</p> 16th Apr 12 Private equity: attractive growth option <p><strong>Story by Leon Gettler of <em>Leading Company</em></strong></p> <p>This article in the Leading Company website contrasts the negative press private equity often receives to the perspective of an Australian private equity manager and AVCAL members, Wolseley Private Equity. Speaking to Angus Stuart, a director at Wolseley, the article documents the relationship between a private equity manager and the businesses they invest in. The article also looks at some of the operational aspects observed by the PE manager in growing/expanding their portfolio companies and some facets of the private equity management style that are often not openly discussed in the mainstream press.</p> <p><a href=";utm_campaign=8987166859-Tuesday_March_133_13_2012&amp;utm_medium=email" target="_blank">More</a><br /> <br /> <br /> &nbsp;</p> 16th Apr 12 AVCAL Newsletter - April 2012 5th Apr 12 AVCAL submission to Government's venture capital review 22nd Mar 12 Private equity buoys pension fund returns <p><em>By Bronwyn Bailey, vice president of research at the Private Equity Growth Capital Council, Washington</em><br /> <br /> The California Public Employees&rsquo; Retirement System decision on March 19 to reduce its assumed rate of return by a quarter point &mdash; to 7.5% from 7.75% &mdash; has rippled across the pension community.The downward revision can be seen as a bellwether for pension funds around the country, bringing into focus the factors challenging public pension plans&rsquo; ability to meet their obligations to retirees, including rising and unfunded liabilities, tighter state and municipal finances, and volatile capital markets.But the most glaring problem is the simplest to understand: Pension plans are not able to consistently generate adequate returns from public markets to meet their needed return targets.<br /> <br /> When pension investments yield lower returns, employers &mdash; in this case the State of California and participating municipalities &mdash; must pay higher pension contributions to ensure the fund has the needed resources to pay retirement obligations. A target reduction of a mere one quarter of 1% is expected to cost California more than $300 million per year as well as increasing obligations of local municipalities and school districts. This could put even more pressure on cash-strapped state and municipal budgets and force taxpayers to ultimately foot the bill. The results could mean fewer schools, police officers and firefighters in California communities. But this is not an issue for California alone. Pensions &amp; Investments data show that four of the nine largest public pension funds maintain assumed rates of return of more than 7.5%.</p> <p>With U.S. public markets underperforming over the past decade, large pension funds have increasingly turned to alternative asset classes, including private equity, for their proven track record of generating superior investment returns. Given the challenges facing pension funds, this would seem like an easy decision.</p> <p>More - <a href="" target="_blank">PEGCC site</a> and as published by <a href="" target="_blank">Penions and Investment magzine</a></p> 16th Mar 12 AVCAL Newsletter - March 2012 15th Mar 12 Private equity trends in Australia â the facts <p><em>AVCAL has had published in UK-based Financier Worldwide&#39;s &quot;Global Reference Guide: Private Equity &amp; Venture Capital 2012&rdquo; commentary about the Australian PE industry.</em></p> <p>&quot;They say any press is good press, and Mitt Romney&rsquo;s US Republican presidential nomination campaign has certainly brought private equity back into the headlines around the world. Suddenly commentators are expressing opinions and debating an asset class that has been ignored &ndash; or dismissed as being a train wreck for the last few years.</p> <p>&quot;What has the debate taught us? Well the perceptions were wrong. Instead of being a train wreck, private equity (PE) actually delivered some of the best returns of any asset class during the turbulent period of the global financial crisis. This has been true of Australian private equity as well as elsewhere in the world.&quot;</p> <p><a href="" target="_blank">More</a> (go to page 16)<br /> &nbsp;</p> 13th Mar 12 AVCAL chair clarifies news story <p>AVCAL Chair David Brown clarifies a <a href="" target="_blank">story</a> in Investment and Technology News (I&amp;T News) about a session at the Asian Venture Capital Journal PE conference in Sydney last week.<br /> &nbsp;</p> 12th Mar 12 Helmsman Capital takes off with aviation deal <p>Special situations private equity firm, Helmsman Capital, has funded a major restructure of Curry Kenny Aviation, a high growth regional aviation business.</p> <p>The transaction involved a circa $50m balance sheet restructure of the business, with Helmsman taking a majority economic stake in the business. Helmsman partnered with the founders of the business, Australian sporting icons Grant Kenny and Lisa Curry, as well as other members of the management team.</p> <p>The broader Curry Kenny investment group, which has significant investments in property development, was adversely impacted by the rapid GFC driven decline of the property market on the Gold and Sunshine coasts and the impact of the Queensland floods in 2011.</p> <p>Helmsman overcame numerous challenges in the transaction. Helmsman Managing Director, Douglas Potter, said &ldquo;It was certainly one of the more complex transactions we have undertaken and played to Helmsman restructuring strengths, involving a large number of key stakeholders including five banks, and six non-bank financial institutions holding discrete bilateral positions. We were very pleased to achieve an outcome satisfactory to all of these parties.&rdquo;</p> <p>Helmsman was attracted to the growth potential of the regional and remote aviation sectors, noting the strong positioning of Curry Kenny Aviation operations across central QLD and north western WA. The business provides fixed wing and helicopter services to the expanding mining, energy, tourism, and community sectors for private, corporate and Government customers. Key operating hubs in the Gladstone/Mackay region in QLD and across the Kimberly region of WA will be the focus of expansion activities. The business strategy will result in a more streamlined operating model centred around the operations that can demonstrate high growth profiles.</p> <p>Grant Kenny, founder and CEO, advised &ldquo;that partnering with Helmsman will enable a number of exciting growth opportunities to be pursued by our business across its existing bases, as well as broadening the geographic footprint with growth into larger aircraft types&rdquo;.</p> <p>The investment represents the 3rd by Helmsman in the last half of 2011 and the 7th investment from the 2008 vintage Helmsman Capital Fund II.</p> <p>Helmsman was advised by Minter Ellison and Blake Dawson (Legal), KPMG (Financial) and RSM Bird Cameron (Tax) with Kardos Scanlan (Legal), KPMG (Corporate Finance) and Crowe Horwath (Tax) advising Curry Kenny.</p> <p><a href="/documents/item/314" target="_blank">PDF of media release</a></p> 27th Feb 12 AVCAL members pick up awards <p>Congratulation to the AVCAL members who won awards at the just-announced PE Asia 2011 Awards.</p> <ul> <li>Archer Capital - firm of the year in Australasia, followed by Quadrant Private Equity and Advent Private Capital.</li> <li>Navis Capital - firm of the year in Southeast Asia.</li> <li>CHAMP Private Equity - best Asian mid-sized deal (Constellation Brands).</li> <li>The Carlyle Group - best Asian large exit (China Pacific).</li> </ul> <p><a href="" target="_blank">More</a><br /> &nbsp;</p> 27th Feb 12 New AVCAL office - we have moved <p>AVCAL has relocated a short distance to new offices.</p> <p>Our new address is Level 10 Kyle House, 27-31 Macquarie Place, Sydney NSW 2000. Our phone numbers remain the same, although we do not have full phone functionality as yet. Our main office number continues as 02 8243 7000.</p> 22nd Feb 12 Catalyst and Bhagwan Marine form partnership for growth <p>Catalyst Investment Managers Pty Ltd (&ldquo;Catalyst&rdquo;) and Bhagwan Marine Pty Ltd (&ldquo;Bhagwan Marine&rdquo;) today announced that they have completed a transaction whereby Catalyst has acquired a significant shareholding in Bhagwan Marine and provided capital for future growth of the business. The transaction was led from Catalyst&rsquo;s recently opened Perth office.</p> <p><a href="" target="_blank">More</a></p> 15th Feb 12 New AVCAL Chair <script language="JavaScript"> <!-- window.onload=function() { window.location = '' } //--> </script> 13th Feb 12 AVCAL research library update <p>AVCAL&#39;s wesbite has a new Research Library that is a one-stop centre to access current international research on PE and VC, such as the global evidence on the important economic role of the industry.</p> <p>To view the latest global research, visit the <a href="/stats-research/research-library" target="_blank">Research Library</a> and look for the items marked <strong><span style="color: rgb(255, 0, 0);"><em>NEW</em></span></strong>.</p> <p>Recent items include:</p> <ul> <li><strong>Coller Capital&rsquo;s</strong> <strong>Global PE Barometer </strong>Winter 2011-12 survey of LP attitudes towards the PE asset class, with over two-thirds of LPs surveyed expecting 2012 to be a good/excellent vintage year for PE.</li> <li><strong>GE Innovation Barometer, </strong>which reviews the challenges and opportunities presented by the current state of innovation in Australia.</li> <li><strong>2012 Private Equity Report: Engaging for Growth</strong> - a study by the Boston Consulting Group looking at 2012 trends and areas of operational value creation.</li> <li><strong>UK Fast Track research report </strong>by Deloitte/Fast Track looks at the UK&rsquo;s 100 PE-backed midmarket companies with the fastest-growing EBITDA over the last two years.</li> <li><strong>PE Spotlight</strong> - this Preqin report reviews global PE activity in 2011.</li> <li><strong>Global Pension Assets Study 2012 </strong>- this Towers Watson report looks at current trends in global pension assets in 13 major pension markets with total AUM of over $27 trillion.</li> <li><strong>Asia-Pacific 2012 PE Outlook </strong>by Ernst &amp; Young</li> <li><strong>Q4 2011 Debt Market Update</strong> by KPMG</li> <li><strong>Do Private Equity Fund Managers Earn Their Fees?</strong> This study by Robinson &amp; Sensoy looks the relationship between PE manager compensation and performance over the period 1984 to 2010. They find that managers with higher compensation generally earn back their pay by delivering higher gross performance.<br /> &nbsp;</li> </ul> 13th Feb 12 Venture capital vital to Australia <p>The UK-based <em>Corporate Live Wire</em> publication has just printed an AVCAL story on the Australian venture capital industry.</p> <p><a href="/documents/item/311" target="_blank">PDF version of the story</a><a href="" target="_blank"><br /> Online version of the story</a><a href="" target="_blank"><br /> Online version of the magazine</a></p> <p><br /> &nbsp;</p> 9th Feb 12 Catalyst acquires interest in Morris Corp <p>Catalyst Investment Managers Pty Ltd (&ldquo;Catalyst&rdquo;) and Morris Corporation Holdings Pty Ltd (&ldquo;Morris&rdquo;) has announced that they have completed a transaction where funds advised by Catalyst have acquired a&nbsp; significant shareholding in Morris.</p> <p>Morris is one of the largest providers of remote facilities management and accommodation services to the resources sector in Australia. The business first commenced operations in 1966 and now provides comprehensive facilities management services in remote regions to customers in the mining and oil &amp; gas sectors. Morris also owns and operates a number of remote accommodation camps which cater for fly-in fly-out (FIFO) workers.</p> <p>Under the terms of the transaction, Catalyst has acquired a 49% interest in Morris, with the current major shareholder, Robert McVicker and management continuing to hold the balance of the shares in the company.</p> <p><a href="/documents/item/302" target="_blank">More</a></p> 9th Feb 12 VFMC likes private equity <p>Investment and Technology News reports:</p> <p>In this article in the I&amp;T News website, Justin Arter from the Victorian Funds Management Corporation comments on the performance of their private equity allocation, and the importance of having a modest private equity allocation in a volatile market.</p> <p><a href="" target="_blank">More</a><br /> &nbsp;</p> 9th Feb 12 Australian private equity returns continue to outperform <p>The Cambridge Associates LLC Australia Private Equity and Venture Capital Index (CA Australia Index) demonstrates that private equity continues to deliver stable, solid returns in periods of high volatility for public equities.</p> <p>The CA Australia Index, which measures private equity and venture capital returns in Australia, outperformed the S&amp;P/ASX 300 Index over all time horizons for up to 10 years, according to the latest quarterly report released today.</p> <p><a href="" target="_blank">More</a></p> 3rd Feb 12 My experience as a private equity CEO <p>This article by Armand F. Lauzon Jr. in the Wall Street Journal looks at a generally unseen side of private equity &ndash; the perspective of the CEO of a private equity-backed portfolio company. Mr Lauzon, currently the CEO if Sequa Corporation (backed by the Carlyle Group), talks about his experiences as the CEO of three companies owned by the Carlyle Group. Mr. Lauzon contrasts his value creation experience in these companies to the often negatively and wrongly&nbsp; perceived connotation of the private equity industry as being corporate raiders.</p> <p>Mr. Lauzon served as the CEO of three Carlyle backed companies: John Maneely Company, Sequa Corporation, and Firth Rixson.</p> <p><a href="" target="_blank"><br /> More</a> (subscriber site)</p> 2nd Feb 12 Wolseley sells Freshmax <p>Wolseley has accepted an offer from Maui Capital, an Auckland based private equity firm, to acquire Wolseley&rsquo;s shareholding in Freshmax. Management will continue as significant shareholders in the business.</p> <p>&ldquo;Wolseley is very pleased to have been associated with Freshmax during a remarkable growth period,&quot; said Brendan Hill, a Director of Wolseley and on the Board of Freshmax. &quot;Freshmax is the stand-out business in an attractive investment sector and we wish the management team, grower supply partners and the Freshmax Board much continued success in the next stage of the Group&rsquo;s development.&rdquo;</p> <p><a href="" target="_blank">More</a><br /> &nbsp;</p> 1st Feb 12 Harbert invests in Techdrill Civil and Mining Services <p>Harbert Australia Private Equity (&ldquo;Harbert&rdquo;), the private equity firm targeting lower-middle<br /> market investments, today announces the acquisition of a 45% interest in Techdrill Civil &amp; Mining Services Pty Ltd (&ldquo;TCMS&rdquo;), a diversified mining and infrastructure services group. TCMS was formed in December 2011 from the merger of Techdrill Services (&ldquo;Techdrill&rdquo;) and Rock Drilling Australia (&ldquo;RDA&rdquo;).</p> <p><a href="/documents/item/381">More</a></p> 1st Feb 12 Chant West highlights benefits of private equity to superfunds <p>The Chant West superannuation fund performance report for calendar year 2011, just released on its website, shows that super funds with greater investment exposure to alternative assets such as private equity have been performing best.</p> <p>In its <a href="" target="_blank">statement</a>, Director Warren Chant says:&quot; In the face of falling share values, growth funds actually did quite well to restrict their losses to the level they did. <em><strong>That&rsquo;s largely because, over the years, they have diversified into other growth assets beyond listed shares</strong></em>. In 2011, unlisted property, unlisted infrastructure and private (ie unlisted) equity all produced quite strong positive returns which helped to counteract the negative returns from listed markets.&quot;</p> <p>The table of asset class performance shows PE was the best performer over a one-year period at 12.1%.</p> <p>Chant continues: &quot;<em><strong>The strong performance of unlisted assets has had a stabilising effect on fund returns in 2011</strong></em>. These are assets that are revalued regularly but not frequently, and those valuations tend to lag what&rsquo;s happening in listed markets. Where unlisted assets go from here will be affected by whether listed markets recover &ndash; and if so how fast &ndash; from their current troughs. If they recover quickly, then we may not see too much marking down of unlisted asset values.&quot;</p> <p>The statement says &quot;although both Australian shares and international shares fell, by 11% and 5.3% respectively, by being well diversified across a wide range of growth and defensive asset sectors, the loss for the median growth fund was limited to 2%. The same comment applies when we look back over the past five years. This period, which includes both the GFC and the more recent sovereign debt-driven crisis, has been highly unusual in that both Australian and international shares have gone backwards. <em><strong>Yet, by finding alternative sources of return, including unlisted growth assets such as infrastructure, property and private equity, even some growth funds have produced a small positive return</strong></em>.&quot;</p> <p>Chant says: &quot;Industry funds as a group finished slightly ahead of master trusts because they tend to have lower allocations to listed shares and listed property. The corollary is that they also have higher allocations to unlisted assets such as private equity, unlisted property and unlisted infrastructure (20% versus 3%), which performed well for them.</p> <p>&quot;Over the longer term, the strategic allocation policies of industry funds have served them very well.<em><strong> In particular, those allocations to unlisted assets have added to performance and reduced volatility, or risk. They do mean slightly higher investment costs, but those extra costs have been more than justified by the added benefits</strong></em>.&quot;</p> <p>The statement says this is evident in Chart 6 which shows the top 10 performing growth funds over seven years, a list dominated by industry funds.</p> <p><a href="" target="_blank">2011 calendar year release</a></p> <p><a href="" target="_blank">2010/11 financial year release</a></p> 31st Jan 12 Future Fund increases PE allocation to 5.3% <p>In releasing its <a href="" target="_blank">latest portfolio statement</a>, the Future Fund has again increased its private equity allocation as a proportion of total assets.</p> <p>The PE allocation over the last quarter increased to 5.3% (to $3.9b), up from 5% <a href="" target="_blank">the previous quarter</a>. This follows previous quarterly increases to 3.9% and 3.4%.</p> <p>In the statement, FF Board of Guardians Chair David Murray said: &ldquo;In this environment, the Board continues to place a premium on patience and liquidity, ensuring that the portfolio is prudently positioned to take up&nbsp; attractive opportunities while avoiding excessive risk.</p> <p>&ldquo;Notwithstanding the current environment, the Future Fund was set up as a long term investment fund and the Fund&rsquo;s statutory purpose and mandate leads the Board to continue to position the portfolio to achieve its long term objective.&quot;</p> 30th Jan 12 How Private Equity Works - Yale professor commentary <p>Jonathan Macey is a professor of corporate law, corporate finance and securities law at Yale Law School. He has published on his <a href="" target="_blank">Yale website</a> and in the <a href="" target="_blank">Wall Street Journal</a> the following commentary to redress the sensationalist and inaccurate claims being made about private equity in the context of the Mitt Romney campaign.</p> <p><strong>How Private Equity Works </strong><br /> <em>By Jonathan Macey &rsquo;82 </em></p> <p>Mitt Romney&#39;s candidacy is subjecting the entire private-equity industry&mdash;where Mr. Romney spent most of his business career&mdash;to vicious attacks by journalists and several of his rivals for the Republican presidential nomination.</p> <p>Newt Gingrich&#39;s political action committee is sponsoring a film called &quot;When Mitt Romney Came to Town&quot; that accuses Mr. Romney and his former company, Bain Capital, of taking over companies, looting them, and then tossing their workers out on the street. Jon Huntsman&#39;s attacks on his rival include the description of private equity as a business that &quot;breaks down businesses [and] destroys jobs, as opposed to creating jobs and opportunity, leveraging up, spinning off, [and] enriching shareholders.&quot;</p> <p>This is anticapitalist claptrap. Private-equity firms make significant investments in companies, mainly U.S. companies. Most of their investments are in companies that underperform industry peers. Frequently these firms are on the brink of failure.</p> <p>Because private-equity firms are, by definition, equity investors, they make money only if they improve the performance of their companies. Private equity is last in line to be paid in case of insolvency. Private-equity firms don&#39;t make a profit unless their companies can meet their obligations to workers and other creditors.</p> <p>The companies in which private-equity investors are able to turn a profit generally grow, rather than shrink. This is because the preferred &quot;exit strategy&quot; by which private-equity firms profit is to take the private companies in which they invest and enable them to go public and sell shares that will help the company grow even stronger. As for turnaround success stories, Continental Airlines, Orbitz and Snapple have all benefitted at some time from private-equity investment.</p> <p>Or take Hertz. Ford sold Hertz to private-equity investors in 2009 for $14 billion. These investors were able to take the company public less than a year later at an equity valuation of $17 billion. The Hertz success story is consistent with the empirical data that indicate companies owned by private-equity firms typically outperform similar companies that do not have a private-equity investor (as measured by profitability, innovation and the returns to investors in initial public offerings).</p> <p>Private-equity firms not only help corporate performance, but in the long run they lead to more employment and higher wages as well. The alternative to the leaner, smaller firms created by private equity are bankrupt firms that do not employ anybody. And private-equity firms tend to use more incentive-based pay than other firms. A 2008 Government Accountability Office (GAO) report shows that the companies in which private-equity firms invested had low employment growth relative to their peers, and their employment growth rose after they were acquired by a private-equity firm.</p> <p><a href="" target="_blank">More</a></p> 24th Jan 12 Welcome to our new web platform <p><span style="color: rgb(255, 0, 0);">AVCAL has implemented a new IT platform</span></p> <p>This means we have a new database, member portal and website, which are now all integrated. While the website appears similar to&nbsp;old one, there are a number of&nbsp;improvements. This includes the making it easier&nbsp;for members to update their details and to register for events.</p> <p>However, we are currently in the change over phase and some of the improved functionality is still being implemented. So please be patient during this short transition period.</p> <p>Should you need any support in the meantime please call us on 02 8243 7000 or email <a href=""></a>.</p> 23rd Jan 12 AVCAL responds to columnist's erroneous claims <p>&nbsp;</p> 11th Jan 12 AVCAL discusses private equity with various media outlets <p>AVCAL CEO Katherine Woodthorpe has given interviews and background to various media outlets focussing on a number of private equity deals currently in play. Here is a selection.</p> <h3><strong class="bold">ABC News</strong></h3> <p><a href="" onclick=";return false;" onkeypress=";return false;">Listen to the extended interview</a> on the World Today</p> <p><a href="" onclick=";return false;" onkeypress=";return false;">Listen to the abridged version</a> and <a href="" onclick=";return false;" onkeypress=";return false;">read the transcript</a></p> <p><a href="" onclick=";return false;" onkeypress=";return false;">Read the repurposed &quot;print&quot; story</a> on the ABC News website</p> <h3><strong class="bold">Australian Financial Review</strong></h3> <h4>DealBook</h4> <p><strong class="bold">Private equity marks its return</strong></p> <p>PRINT EDITION: 10 Jan 2012</p> <p>By Anthony Macdonald</p> <p>Private equity managers are often contrarians: a favourite catch-cry is that the best investments are often made when everything else in the market looks grim. It&#39;s at these times - when the equity values of public companies are down, economic conditions tough, the fundraising environment bleak and equities investors at their wits&#39; end - that private equity managers can score themselves a 10-bagger and enter industry folklore.</p> <p>PE stalwarts say it was these sorts of market conditions in 2004 that helped Catalyst Investment Managers bank such a number on jeans retailer Just Group, just as equity markets were beginning a long bull run. That same year, CVC Asia Pacific and Catalyst returned 7.4 times their original equity investment on Pacific Brands. Both investments were realised inside three years. So might the recent private equity approaches to three unloved and underperforming public companies - Spotless, PaperlinX and Pacific Brands - signal another run for private equity? While all three deals are in preliminary stages, the approaches show buyers are lurking for cheap targets - and biting at carrots laid down by bankers over the past few months. The bids suggest bets are being placed that the market is bottoming out, and unloved companies can be turned around.</p> <p>Spotting poor equity market performance, frustrated shareholders and the economic uncertainty, bankers have been shopping these, and other potential turnaround stories, to PE managers, knowing they are deep value investors at heart. Their mission is to buy low, improve a business, and sell for a profit, usually inside a five-year time frame. If it&#39;s done at the right time of the cycle, the potential for impressive returns is maximised. &quot;Pricing on new investments is pretty favourable. We&#39;re expecting a lot of new activity this year,&quot; a local PE firm partner told Financial Review DealBook on Tuesday. &quot;We&#39;re looking for unloved names that don&#39;t get a lot of following. With a new management team, and a PE approach, you can improve the performance of the business pretty quickly.&quot;</p> <p>Not surprisingly, data shows investments made at the bottom of the cycle and sold into a rising market will achieve the best returns. 2003 was the best year for Australian PE investments, according to data prepared for DealBook by the Australian Private Equity and Venture Capital Association (AVCAL). The 14 initial investments made in 2003 returned an average 82.3 per cent on exit. The assets were bought before the bull run started in 2004, and sold into the rising markets leading into 2008 (when the S&amp;P/ASX 200<br /> peaked at close to 7000 points), allowing the PE owners to benefit from price to earnings multiple expansion. They were helped by the M&amp;A cycle also peaking in 2007, which ensured competition for PE exits and hype around sales processes.</p> <p>INSTITUTIONS OF THE UNLOVED LOOK TO CASH OUT</p> <p>As Spotless has shown, boards can be reluctant to engage with PE suitors, given the often highly conditional nature of bids. Spotless&#39;s management also had turnaround plans of its own to enact. A bid from PE must ultimately win over the target company&#39;s shareholders, some of who would have watched the value of their shares drop markedly under the current management. There is a growing feeling among bankers that investors are willing to support PE bids in the current market, where returns are hard to come by. Some of Spotless&#39;s investors, including Orbis Investment Management and Investors Mutual, have already thrown their support behind Pacific Equity Partners&#39; $2.68 a share bid.</p> <p>For fund managers, the question is whether the target company can realistically achieve sharemarket gains of 30 per cent or more - an average takeover premium which fund managers can bank if they sell into an offer - under its current management. More often, bankers say they are finding the answer to that question is no. &quot;Institutional investors are less in love with some of these assets now,&quot; a senior banker told DealBook. &quot;Throughout 2004 to 2008 with the PE failed bids for the likes of Orica and Qantas, there was always a shareholder blocking these proposals. I suspect now it is probably easier.&quot;</p> <p>DEBT EASIER FOR LOW MULTIPLE TARGETS</p> <p>Debt funding markets are also supportive of the right transactions. Recent transactions have seen PE funds invest about 50 per cent equity and borrowing the rest. According to Deutsche Bank analysis, recent deals have been done at about five-times debt to EBITDA (earnings before Private equity marks its return interest, taxes, depreciation and amortisation), including Bain Capital&#39;s $1.2 billion purchase of MYOB and Archer Capital&#39;s acquisition of fast food provider QSR. Leverage plays an important role in PE plans. It provides capital to otherwise constrained companies and can enable the manager to gets its turnaround plan on track.</p> <p>PE managers say debt markets are challenging, but deals are still getting done. They say it&#39;s easier to secure finance when you are paying a low multiple for the business, which is another reason to focus on the underperformers. It&#39;s also interesting that PE funds are investing funds at a time when companies are sitting on record levels and cash and riding out the economic uncertainty. PE managers have a limited time horizon to invest their money and are trying to get in ahead of trade buyers. Industry logic says that a trade buyer should be able to out-bid PE players based on synergies it can create.</p> <p>DRY POWDER</p> <p>The PE fundraising cycle is also driving deal making. Australian PE firms raised a record $8.6 billion in the 2007 financial year, according to AVCAL. Most PE funds are raised with a 10-year time horizon, and fund managers generally look to invest over the first five years to provide sufficient time to manage an investment through to a profitable exit. Therefore, the funds raised in 2007 will be looking for a home this year. AVCAL estimates local firms have up to $7 billion of uninvested capital, while regional funds such Pacific Brands suitor Kohlberg Kravis Roberts &amp; Co are also cashed up. But this dry power has been reduced by the challenging fundraising environment since 2007&#39;s record year: Australian PE funds raised in the four financial years since 2007 averaged $1.6 billion a year. For those seeking to invest, this has reduced some competition on deals.</p> <p>Competition for assets has been a big issue for PE managers in the United States. When PE buyers are forced to go up against each other, they can end up paying too much for an asset, reducing overall returns.</p> <p><em class="italic">The Australian Financial Review</em></p> <h3>The Australian</h3> <p><strong class="bold">Small is beautiful for price-conscious predators</strong></p> <p>By <em class="italic"><cite>Jennifer Hewett, National Affairs correspondent</cite></em></p> <p>From:<cite><a href="">The Australian</a></cite></p> <p>THE private equity bids for companies such as Pacific Brands and Spotless make it look as if private equity is back in a big way in Australia. The truth is it never really went away.</p> <p>But what has changed is the size of the deals and the amount of leverage involved.</p> <p>Forget the ambitious multi-billion-dollar mega deals, for example, that saw the big global players in private equity make ultimately unsuccessful bids for companies such as Coles and Qantas. Or the &quot;successful&quot; private equity forays on the Seven and Nine networks in 2006.</p> <p>These were all in the glory days before the global financial crisis made everyone realise that there was indeed such a concept as too much debt and that asset prices didn&#39;t automatically keep rising. Now expectations tend to be more modest - along with the money involved.</p> <p>It&#39;s not just that some of the big-bang debt deals of several years ago - such as CVC Asia Pacific&#39;s investment in the Nine Network - are still causing their private equity owners such grief. It is that everyone has had to become more cautious about what can go wrong and what is necessary to make the numbers add up.</p> <p>Price, price, price. That is even more the case when the supply of money from Australian banks is neither as cheap nor plentiful, as it once was.</p> <p>&quot;Banks are not prepared to underwrite or hold as much as they used to in terms of quantum or leverage,&quot; one seasoned adviser says. &quot;But it&#39;s still very possible to get debt from Asian and Aussie banks around the $1 billion mark.&quot;</p> <p>And although it was certainly difficult to get funding for almost any deal for a couple of years after 2008, the private equity players also never stopped looking.</p> <p>Many of those deals that did proceed were much smaller, involving either unlisted companies or lesser-known ones, so they didn&#39;t make much news. Others just never got past the starting line of the new commercial reality.</p> <p>Another obvious supplier of capital, Australian superannuation funds, have been decreasing their exposure to private equity. In late 2009, the fruitless raid by the Australian Taxation Office&#39;s pursuit on (empty) TPG bank accounts in pursuit of tax it considered payable on TPG&#39;s profit on the float of Myer also complicated Australia&#39;s appeal.</p> <p>But global players did start to restructure deals to avoid any potential problems with the ATO. And while many disgruntled Myer retail shareholders may still be furious at the price they paid in the float, the Myer deal was further evidence that Australia could still be a very good investment for private equity.</p> <p>By late 2010, the $2.7bn Healthscope deal involving TPG and another global private equity group, Carlyle, signalled to everyone that the private equity market remained very much alive in Australia.</p> <p>Even so, Katherine Woodthorpe, chief executive of the Australian Private Equity and Venture Capital Association, still says the perception that private equity &quot;is back on the prowl in Australia is a little overcooked&quot;.</p> <p>&quot;There has been some increase in activity over the past 12 months in terms of funds invested,&quot; Woodthorpe says.</p> <p>&quot;But around 40 per cent of that (last financial year) was due to the Healthscope deal. The number of deals themselves actually reduced. And most are at the smaller end of the midrange market so they tend to be under the radar.&quot;</p> <p>Not so, of course, with well-known names such as Pacific Brands and Spotless. And it does show that private equity remains in constant search mode for opportunities, including at least a few of the relatively larger deals.</p> <p>Apart from anything else, private equity groups have a limited period of time - about four to five years - to invest the money they have raised in what are usually 10-year funds before they have to return the money with no result. It doesn&#39;t do their statistics or their appeal to investors or their returns any good for that to happen.</p> <p>The general concept is that private equity can restructure a company, including injecting capital, and make it more efficient before exiting via a float or a trade sale within about five to seven years. This doesn&#39;t always work according to plan, especially if the share price falls post float.</p> <p>Well before that stage, however, one of the problems right now is the differing views on value. Clearly, it can be a good time to buy when prices are relatively cheap and it turns out to be the bottom of the cycle. Although prices may have fallen and economic conditions may be so uncertain or downright miserable - as in Europe - many owners of public and private companies remain reluctant to sell at prices private equity is willing to pay.</p> <p>In Australia, where economic growth has been stronger than much of the developed world, that mismatch of expectations is clearly in evidence. Many company boards firmly believe their fundamental value is stronger than their depressed share price indicates. Some of their institutional shareholders, dismayed by the outlook and more seduced by relative short-term returns, may be less patient. But given that private equity generally prefers to work with the imprimatur of the board rather than make a hostile bid, it can lead to a dead end.</p> <p>So the hype about a new rash of major deals, especially in the retail sector, may remain largely just that.</p> <p>The Pacific Equity Partners pursuit of Spotless, for example, has run into difficulties with the Spotless board refusing to engage until or unless PEP lifts its offer to at least $2.80. PEP said yesterday that the board had not provided it with any justification for increasing its bid.</p> <p>The difference between valuing a company at $711 million and at $743m may not seem much but PEP has suffered through enough examples of deals going sour and its companies going into administration to make it determined not to overpay.</p> <p>Similarly, the KKR interest in Pacific Brands is at a preliminary stage. It would like to produce a win after failing to get deals with Healthscope, Perpetual and Transpacific. But overpaying would be even worse.</p> <p>For Pacific Brands, it would actually be a return to private equity after CVC and Catalyst floated it back in 2004, only for the company to be hit by increased competition and inability to grow as promised. In this case, KKR has a lot of global retail experience and global supply chains that could allow it to take some of the Australian brands international.</p> <p>Will this work? KKR is clearly willing to bet more than $600m that it will.</p> <p><em>The Australian</em></p> 21st Dec 11 State of Play Down Under - interview <p><strong class="bold">US-based private equity digitial news service Privcap interviews AVCAL CEO Katherine Woodthorpe about industry trends in Australia.</strong></p> <p>Australia is by far the most mature private equity market in the Asia Pacific region and the Australian economy is looming large as a major private equity investment opportunity over the long term. Not only is there sustained interest from investors around the world in participating in the growth of Australia&rsquo;s private businesses, but private equity fund managers are intrigued by Australia&rsquo;s vast network of superannuation funds and other potential limited partners. To get a better understanding of the Australian private equity opportunity today, Privcap spoke with Katherine Woodthorpe, chief executive of the Australian Private Equity &amp; Venture Capital Association (AVCAL).</p> <div> <p>Topics of discussion include:</p> <ul> <li>Does Australia even need foreign private capital what with its robust domestic equity and private equity markets?</li> <li>How does Australia fit into the broader Asia-Pacific economic growth story?</li> <li>What are some challenges with the way the private equity is understood by the Australian media and policymakers, and what is AVCAL doing to challenge stereotypes?</li> <li>What do non-Australian GPs need to know about the Australian fundraising market?</li> <li>What is the Australian government doing to boost venture capital and innovation locally?</li> </ul> <p><strong><a href="">Listen to to the interview</a></strong></p> </div> 16th Dec 11 December 2011 Newsletter 15th Dec 11 AVCAL congratulates Southern Cross on REVCF mandate 7th Dec 11 AVCAL welcomes venture capital funding, calls for more 6th Dec 11 Blue Sky Alternative Investments to list on ASX <p>Transitioning to a publicly listed company is a key part of Blue Sky&rsquo;s long term growth strategy.</p> <p>As part of the initial public offer (&lsquo;IPO&rsquo;), Blue Sky is seeking to raise $7.5m for 22.3%of its share capital (on a fully diluted basis). This will be used both as regulatory capital to meet ASIC requirements as its assets under management grow, as well as to fund a range of initiatives that will promote growth in the Blue Sky Group.</p> <p>The capital will not be used to purchase the interest of any existing shareholder, all of whom are retaining their shares in the company.</p> <p>The listing is planned for December 16.&nbsp;</p> <div class="wrapper"> <div class="news-item-links"> <div class="link-title"> <a class="link wrapper link-even" href="" title="Blue Sky website - more information"><span class="title">Blue Sky website - more information</span></a></div> </div> </div> 5th Dec 11 Advent Private Capital announces successful first close <p>Advent Private Capital Pty Ltd today announced the first close of its Advent 6 fund with confirmed commitments of just under $100million. The inaugural investors in the Advent 6 fund primarily comprise domestic wholesale fund managers and international retirement funds. Advent Private Capital Pty Ltd has also made a significant investment in the new Advent 6 fund.</p> <p>Rupert Harrington, Managing Director of Advent, said: &quot;Advent 6 will continue the strategies developed and employed in the previous generations of Advent funds. It will concentrate on mid-market opportunities, investing around $25-50million at a time in established, profitable businesses with enterprise values between ca. $40million and $200million.&quot;</p> <p>&quot;The Advent 6 fund will be similar in size to Advent&#39;s previous funds, allowing the manager to maintain its focus on the mid-market - where it has historically been very successful,&quot; said Robert Radcliffe-Smith, an Executive Director of Advent. &quot;The fund will have a 10-year life and is expected to build a portfolio of 8 to 10 mid-market investments in Australia and New Zealand. International and Australian institutions are likely to dominate further investment in Advent 6.&quot;</p> <p>The first Advent 6 investment will be in Orionstone Pty Ltd, a heavy earthmoving equipment rental business based in Western Australia and Queensland. Advent has committed a total of $68million for investment in Orionstone from the Advent 5 fund and from Advent 6. Orionstone rents heavy earthmoving equipment to major mining and civil infrastructure customers across Australia, primarily in Queensland, Western Australia and New South Wales. Orionstone is the second largest player in the Australian heavy earthmoving equipment rental market. Its customers, including major mine owners and leading mining contractors, are primarily involved in open-cut and surface mining operations, as well as civil construction and quarrying.</p> <p><a class="link wrapper link-even" href="" title="Advent website"><span class="title">Advent website</span></a></p> 1st Dec 11 VC vital to our nation's hi-tech survival - The Australian <p><strong><em class="italic">The Australian</em> newspaper has published an opinion-editorial column by AVCAL CEO Katherine Woodthorpe that deals with the role venture capital plays in the commercialisation of Australian innovation.</strong></p> <p>The vital role that innovation plays in our nation&rsquo;s development is, rightly, well recognised.</p> <p>But what is not well understood is how management expertise and capital move ideas and concepts from laboratories, garages and backrooms into innovative, commercially viable products and services, adding to the economic well-being of Australia.</p> <p>A major source of entrepreneurial expertise and funding comes from the venture capital (VC) and private equity (PE) industry.</p> <p>Entrepreneurs and innovators seeking support and backing for their intellectual property have limited options to access capital and expertise. There are few advisors and consultants that cater to the early stage market. &nbsp;Early stage companies are high-risk investments often with little or no collateral. &nbsp;Consequently, the firms that are in the best position to invest and advise early stage companies are those that are run by former successful entrepreneurs, scientists, doctors and engineers themselves &ndash; a VC firm.</p> <p>Fund managers running VC firms can bring with them a unique business mindset that seeks out and manages early-stage investment opportunities on behalf of investors (mainly superannuation funds, institutions and wealthy individuals). Their hands-on ability to work closely with the founders/management of innovative companies, on matters of strategic planning, recruitment, and access to international markets and technology, makes them a partner who brings more than just capital to the table.</p> <p>There are around 200 seed, early and late stage companies backed by local VC managers.</p> <p>In the 2011 financial year, 37% of the total VC dollars invested were in the information communication and technology sector (ICT). Life sciences received the majority of VC investments in FY2011; a statistic which has been steady over the last six years. The largest proportion of investments in ICT went into business related software, followed by communication and networking services. Other ICT sectors include semiconductors, consumer electronics and connectivity, networking and communication software.</p> <p>Some well-known VC successes in the ICT sector include Seek, Looksmart, Hitwise and Wedgetail. Successes in life sciences include Cochlear, Resmed and Pharmaxis.</p> <p>One example of a VC fund backing local ICT innovators is Innovation Capital&rsquo;s support of cloud communications company 1300 RECORD Pty Ltd.&nbsp; On 17 November the company announced it had secured $1.5 million from Innovation Capital to fund the establishment of new distribution channels.</p> <p>Other high-tech start-ups with VC backing are video analytics software company iCetana and app developer Filter Squad, both supported by Yuuwa Capital.</p> <p>VC fund managers bring a &ldquo;business focus&rdquo; to new companies, helping them grow to the next stage of their life-cycle, before being sold to another investor or merging with a competitor to create a larger market share.</p> <p>While I would like to say the amount and number of VC investments is growing, the reality is that the VC industry has been contracting in Australia and around the world, even in the US.</p> <p>The VC sector has faced headwinds in recent years, with investors seeking increased liquidity and reluctant to back higher risk, longer term investments.</p> <p>The Australian Government spends around $8 billion a year on research, much of it &lsquo;blue sky&rsquo; adding to the knowledge base but also in the hope that something will come out of it to contribute to the nation&rsquo;s productivity.</p> <p>Despite this government expenditure, little focus is given to commercialise the investment. VC fund managers take on the financial risk to help innovators commercialise their concepts. To help them continue this vital role in the nation&rsquo;s innovation system, there needs to be greater policy support to these &ldquo;enablers&rdquo;.</p> <p>One area of support in recent years has been the Government&rsquo;s Innovation Investment Fund (IIF) program, started in 1998 just before the tech crash.&nbsp; It co-invests with private sector investors in VC funds to assist early-stage companies to commercialise the outcomes of Australia&#39;s strong research capability.</p> <p>However the IIF has only one more tranche of funds left before it ends later this year. Worryingly, there is no appetite from the Government to extend it in any form despite a very positive independent review and the Government&rsquo;s own praise for the programme, leaving the massive taxpayer funded expenditure into R&amp;D without any adequate commercialisation mechanism.</p> <p>Historically, Government intervention into a unique asset class such as VC has been crucial to its growth. Governments in the US and UK have backed their respective early stage sectors for decades and have especially increased their initiatives towards the innovation sector post-GFC.</p> <p>Australia maintains a robust ecosystem that advocates innovation in technology: for example, the Government&rsquo;s zeal to establish a national broadband network is testament to its goal to better the Australian IT infrastructure. Australia is one of the easiest places to start a new business and is one of the best places for laws relating to ICT. Furthermore, Australia&rsquo;s proximity to emerging technology-based Asian powerhouses like China, India, Indonesia and the Philippines gives us access to an agile product testing environment.&nbsp;</p> <p>Dr Katherine Woodthorpe</p> <p>Chief Executive</p> <p>AVCAL</p> <p><a class="link wrapper link-even" href="" title="The story on The Australian's website"><span class="title">The story on The Australian&#39;s website</span></a></p> <p><a class="link wrapper link-odd" href="" title="Online video interview with Katherine Woodthorpe"><span class="title">Online video interview with Katherine Woodthorpe</span></a></p> 21st Nov 11 In honour of Mike Hirshorn <p>AVCAL is deeply saddened by the passing of a council member, colleague and friend, Mike Hirshorn.</p> <p>Mike passed away on 18 November after a long battle with cancer.</p> <p>AVCAL offers condolences to Mike&#39;s family. A pioneer of the industry, Mike will be greatly missed.</p> <p>The Bioshares newsletter has released a special edition in honour of the industry stalwart.</p> <p>It contains tributes from many of his colleagues and friends.</p> <p>The newsletter is published here with permission from Bioshares.</p> <p><a href="/documents/item/281" target="_blank">Bioshares tribute edition to Mike Hirshorn</a></p> 15th Nov 11 Australian private equity deliver stable, solid returns 8th Nov 11 AVCAL congratulates Archer Capital on awards 7th Nov 11 AFR roundtable interview - 'The private equity ideal' <p>The Australian Financial Review&#39;s Dealbook team hosted a roundtable Q&amp;A interview with private equity fund managers to discuss the industry, trends and issues. Click on the link below to read the interview.</p> <p><a href="/documents/item/282" target="_blank">PDF file of Q&amp;A&nbsp;</a></p> 7th Nov 11 Letter to SMH editor 31st Oct 11 Future Fund continues to increase PE holding <p>The Future Fund has further increased its allocation to PE while reducing exposure to volatile assets, according to its <a href="" onclick=";return false;" onkeypress=";return false;">latest portfolio allocation statement</a>.</p> <p>The Fund&#39;s holding of PE assets now stands at 5% ($3,653b), up from 3.9% of its total assets for the last quarter (at $2.896b). This follis 3.4% allocation to PE the previous quarter and from 3% a year ago.</p> <p>FF Board of Guardians Chair David Murray said: &quot;In line with its long term mandate the Board continues to focus on building a diverse portfolio comprising assets capable of generating strong returns. While this inevitably exposes the Fund to periods of market volatility the Board has carefully thought through its risk appetite and positioned the Fund to avoid excessive risk.</p> <p>&quot;The Board is mindful that the uncertainty in financial markets can be expected to endure as the global economy continues to undergo significant structural adjustments over years to come. The portfolio&#39;s recent positioning, together with a decision to further reduce exposures to listed equity markets and increase the cash position, helped to reduce the impact of market falls on the portfolio.&quot;</p> 26th Oct 11 Venture Capital in Australian Biotech <p>GBS Venture Partners&#39; Joshua Funder talks to ABC Radio Australia&#39;s Desley Blanch about Australia&#39;s venture capital industry&#39;s challenges, successes and prospects for the future.</p> <p>&quot;In these volatile times, investment in Australian biotechnology and the growing importance and significance of Asian capital sources in Australian life sciences funding.&quot;</p> <p>DESLEY BLANCH : Has your grandmother had a hip replacement? Has an uncle had a pacemaker fitted? Are you taking drugs to combat heart disease or another chronic illness? Is someone else getting injections for rheumatoid arthritis?<br /> <br /> In Australia, a large part of what we mean by biotechnology is human medical drugs and devices but as well, there&#39;s agricultural biotech and diagnostics.<br /> <br /> Biotechnology as an innovation-based industry requires &quot;high-risk&quot; investment.<br /> <br /> What is the current availability of capital and is Asia a likely source for life sciences funding? Is the tyranny of distance a factor when it comes to appeal and visibility of the Australian life sciences sector to international capital?<br /> <br /> To answer these questions and more is Dr Joshua Funder, a partner with GBS Ventures, an Australian venture capital company.<br /> <br /> DR JOSHUA FUNDER : Look, I think it&#39;s strong and there are several reasons for its appeal, but I&#39;d start locally. Australian stock markets have the highest proportion of biotech stocks relative to the GDP and other countries so there&#39;s clearly a local focus and a local value put on biotech. So I think that&#39;s an asset we go for as a country ourselves.<br /> <br /> Or internationally, people see Australia as a superb source of biomedical research. We really do punch above our weight to use the hackneyed phrase in this sector and so people come here to collaborate academically and to partner commercially with the superb physicians and scientists we have doing research in the field.<br /> <br /> And downstream from that it&#39;s also a very attractive place to conduct clinical studies, so Australians will get better clinical care through those studies, Australian companies will be able to provide services, export services, but international companies can do clinical research here that is unparalleled.<br /> <br /> So I think there are a lot of reasons why Australia&#39;s an attractive market as an investment destination, but also as a development destination for biotech companies.<br /> <br /> DESLEY BLANCH : So is this sector at a stage of maturity that it is sought out as an investment opportunity?<br /> <br /> DR JOSHUA FUNDER : Look, I think those are some of the strengths the biomedical science and technology as well as the opportunities to conduct clinical development. That&#39;s not to say we&#39;re strong in all areas and there are areas where Australia needs to redouble its efforts in order to provide that maturity that you speak of.<br /> <br /> I&#39;d point to two areas, one of which in the provision of adequate capital. I said there are multiple sources of capital and they are all at play in Australia, they all need to be bigger to access the opportunity that we really have here.<br /> <br /> And the second is management. Australia has a flourishing biotech ecosystem, but we don&#39;t have the presence of the big players in pharma or the big players in biotech that in overseas markets train and develop the sorts of expertise and the sorts of leadership and entrepreneurs that we can readily access. So I think there&#39;s a relative dearth of risk capital and also human capital in order to balance out and mature our sector in Australia.<br /> <br /> DESLEY BLANCH : Does Australia have many companies with products that are on market or nearing sales?<br /> <br /> DR JOSHUA FUNDER : We do, and I think it&#39;s something we should be really proud of and we&#39;ve seen a dramatic increase in the number of Australian biotech companies that have products going to market over the last five years and I think it&#39;s something that we should really take note of.<br /> <br /> If you think about the big three that we&#39;ve known about for a while, CSL, ResMed and Cochlear. They&#39;ve been around and putting world leading products onto the market, so they&#39;re clear in the public conscience and actually ResMed and Cochlear came from prior iterations of our venture capital market in Australia.<br /> <br /> More recently, we&#39;ve had a series of terrific successes and breakthroughs. For instance, Acrux have just partnered its product with Lilly. It is already selling into the international market for testosterone replacement for men. So this is a great story. Acrux had a technology that was based on sunscreen where it could deliver drugs into the skin in a reserve. And what they developed finally is a roll-on testosterone under the armpit which is much better than smearing yourself with gels and creams that you have to do now.<br /> <br /> They&#39;ve partnered with Lilly which markets Cialis an erectile dysfunction drug, so they&#39;re going to go global alongside the world&#39;s leading erectile dysfunction drug with a testosterone supplement, so very coordinated marketing with a leading player in the field. That drug is now being used by men around the world and we will see how sales go. That&#39;s a really good example of a sunscreen-based early stage high risk approach yielding significant rewards for a major global need in testosterone replacement.<br /> <br /> There are many other examples I can go onto, Pharmaxis, Sirtex, Heartware are all doing superb things in delivering new products to global unmet medical need.<br /> <br /> DESLEY BLANCH : Well, we hear how it can take at least 15 years and millions of dollars to get drugs to market. Does Australia have any drugs in later stage clinical trials?<br /> <br /> DR JOSHUA FUNDER : Yes, and you&#39;ll see, for instance, Pharmaxis is in clinical studies for bronchiectasis which is a terrible disease of the lungs and in late stage of getting something proved for cystic fibrosis, which is a congenital disease of the lungs. So you can see there a single company with a drug that in registration for one disease and in clinical trials for a second disease.<br /> <br /> We&#39;ve also seen successes in the likes of Peplin and ChemGenex; companies that my fund has been involved with where in the course of conducting clinical trials, those companies have sold to international players who will then take the drug on to market. So there&#39;s value in companies that are continuing to produce the drug and distribute it internationally with or without partnership, but there&#39;s also significant value to be realised in companies with mid-stage clinical products partnering or selling with major international global players.<br /> <br /> DESLEY BLANCH : Well Josh, come back to the last 12 months. What large commercial deals have been made between Australian biotechs and international investors?<br /> <br /> DR JOSHUA FUNDER : Well the stand out one there is probably the relationship between Mesoblast and Cephalon which is a large partnership based on Australian stem cell technology, which has seen Mesoblast evaluations skyrocket. But there have also been partnerships that have led to mergers and acquisitions and I mentioned ChemGenex recently with Cephalon had a relationship of an investment and a partnership that led to the ultimate sale of that company. So partnerships have been successful both in early stage development in the case of Mesoblast but also in later stage products and acquisitions of companies in the case of ChemGenex.<br /> <br /> DESLEY BLANCH : So what&#39;s the current availability of capital like for your sector, given yours is a traditionally high risk investment?<br /> <br /> DR JOSHUA FUNDER : Capital is tight. The superannuation industry has been consistent supporters of us so we&#39;re thankful for that but as a percentage of assets under management, the Australian Super sector under invests in venture and also under invests in health care. So we would love to see a greater support in sustainable, renewable, innovative technologies that are based on Australian companies.<br /> <br /> The public markets have been, as I mentioned before strong supporters of our sector, relative to our GDP and relative to our asset class. So we do have over 100 listed companies in biotech and for the later more mature of those companies, during the GFC, they have been able to successfully renew their capital and raise additional funds. So there&#39;s been a story of success for listed companies that have mature products to access additional capital.<br /> <br /> Many of the smaller companies, and some people call them &#39;penny-dreadfuls&#39;, have fallen away and that&#39;s probably something you would expect to see naturally.<br /> <br /> So I think the overall availability of capital is tight, that&#39;s not specific to our sector. The availability of private capital through superannuation funds and institutional investors in Australia relative to other asset classes has been low and we&#39;d love to see that increase.<br /> <br /> DESLEY BLANCH : So what factors are causing capital constriction?<br /> <br /> DR JOSHUA FUNDER : I think there are several: clearly, disruptions to markets and volatility. I would like to say not any of the high risk that you focus on, but high rewards are in the long term attractive. I&#39;d also like to say that health care is a fundamental need and when you develop innovative products, it&#39;s largely counter-cyclical so the needs for health care and the sales are relatively insulated from the commodity or other cycles that can affect markets.<br /> <br /> But having said that, capital&#39;s tight for biotech I think because we don&#39;t have the experience as an investment sector at renewing success and reinvesting the proceeds of that success into our sector.<br /> <br /> We are ten to 15 years behind where California was, where Canada was, where Israel was, where various other sectors are in some ways in renewing our investment in the sector. And so I think as those companies I just listed have seen products go global and as investors see the proceeds of those returns come through and in Pharma, you can have 80 and 90 per cent gross margins, so very attractive gross margins when you start to sell products and when you make one product, it may take a long time, it may take a lot of money but that product is likely to meet the needs of the medical community internationally. A human disease is a human disease.<br /> <br /> So as people see those sorts of margins on those size of products come back to Australia, I&#39;m hoping investment will be renewed.<br /> <br /> DESLEY BLANCH : What&#39;s the importance of Asian capital sources in life science funding?<br /> <br /> DR JOSHUA FUNDER : It&#39;s growing, and not yet as big as other sources, but certainly welcome and hopefully an exciting adjunct to the ecosystem of our sector and filling that key gap that we have in an under-investment on financial and human capital.<br /> <br /> We&#39;ve seen Asian investors come into ASX-listed companies as institutional investors and we&#39;ve seen Asian investors play an important role in some of the recent IPO&#39;s in the biotech sector and those have been IPO&#39;s in our sector which have been notable, because the U.S. sector has had fewer health care-raised IPO&#39;s relative to the Australian sector. So that&#39;s been an important adjunct, but there are other ways in which exchange of capital, information and expertise has been occurring with Asia more broadly in our biotech sector that is important to acknowledge.<br /> <br /> Many of our companies for instance, undertake their chemistry development and research in China. Other companies conduct clinical trials in India where it&#39;s an optimal place to conduct certain clinical trials. We&#39;re seeing collaboration scientifically and collaborations on health care service delivery.<br /> <br /> The other thing to remember is certainly in Indonesia, Malaysia, many other parts of Asia, we have a very strong legacy of Australian trained in the health and medical welfare executives and professionals coming from Australia, so the links are very strong in both directions.<br /> <br /> DESLEY BLANCH : So how accessible is Asian capital versus, say, United States capital?<br /> <br /> DR JOSHUA FUNDER : Well capital&#39;s tight all round, so capital&#39;s not that accessible. We do have a more mature history of U.S. investors as venture investors investing in Australian companies and U.S. biotechs coming to Australia for their clinical work and US investors coming in as institutional investors on the ASX. But in each of those cases we&#39;ve seen the beginnings of Asian investments across those different modes of investment. So it&#39;s beginning, it&#39;s not as big yet or mature, but I hope it can continue to grow and complement our sector.<br /> <br /> DESLEY BLANCH : So what are the forecasted trends for growth in Asian capital supply?<br /> <br /> DR JOSHUA FUNDER : In a market this volatile, I&#39;m making no predictions whatsoever. I am saying though that not just the financial investment, but the exchange of ideas and expertise, access to markets is welcome in both directions.<br /> <br /> DESLEY BLANCH : Did you have your fingers crossed then?<br /> <br /> DR JOSHUA FUNDER : More than my fingers. (laughs)<br /> <br /> DESLEY BLANCH : Well biotech companies are gathering in Adelaide, South Australia, for the Aus Biotech Conference and it&#39;s the premier biotechnology conference for Australia and the Asia-Pacific region. Josh, what&#39;s the importance of industry events, especially in the current market climate when sectors usually branded as risky are particularly shunned?<br /> <br /> DR JOSHUA FUNDER : Firstly is continuity and in sectors where people are throwing up their hands, in markets where people are despairing of volatility, the ongoing passion that people have to develop new treatments for disease and the commitment required financially, professionally and as a sector to continue those and not abandon those very valuable, but very important scientific and medical developments is required. So conferences like these in some ways keep the flame alive during hard times.<br /> <br /> But the AusBiotech Conference has also had some successes in other areas and one of which is in showcasing local biotechnology companies very clearly for the purposes of investment and very clearly for the discussion around what the next investment required is and who might come together around that company to support that investment.<br /> <br /> So there&#39;s a whole day dedicated to very concise and very investment-focused presentations of the cream of our biotech sector and that enables that sector to learn from each other in their presentations. To learn from the successes of their peers in attracting investment but also to present themselves to global venture investors, to Australian venture investors, to global pharma companies and institutional investors, so providing not just a trade show or a scientific talk fest, but a very focused investment forum has been an important boost to the sector, but an important way to provide a real market for investment in the best of Australian biotech.<br /> <br /> DESLEY BLANCH : Dr Joshua Funder is a partner with GBS Ventures, an Australian venture capital company.</p> <p><strong>Contact:</strong> Dr Joshua Funder, Partner</p> <p><strong>Address:</strong> GBS Venture Partners, Melbourne, Vic</p> <p><strong>Website:</strong><a href=""></a></p> <div class="wrapper"> <a class="link wrapper link-even" href="" title="ABC Radio Australia transcript and podcast webpage"><span class="title">ABC Radio Australia transcript and podcast webpage</span></a></div> 25th Oct 11 Allegro Funds completes MBO of Vulcanite <p><strong>MEDIA RELEASE</strong></p> <p>Emerging mid-market private equity manager Allegro Funds today announced it had completed the acquisition by MBO of Vulcanite Pty Ltd, a leading supplier of engineered parts and equipment for passenger trains in Australia and internationally.&nbsp; &nbsp;</p> <p>The Vulcanite MBO was made with funds managed by Allegro on behalf of leading Australian superannuation funds, and demonstrates Allegro&rsquo;s strategy of co-investing with the superannuation sector in attractive private equity opportunities.</p> <p>Vulcanite has been a trusted supplier of bonded rubber and metal suspension parts to Australian rolling stock manufacturers and rail operators for more than 50 years, providing bespoke engineered solutions to specific customer requirements.&nbsp;The company has successfully penetrated the US and UK rail markets in the past five years, but faced&nbsp;constraints on growth capital under the previous ownership structure.&nbsp;</p> <p>Vulcanite Managing Director, Colin Anbu, who has invested alongside Allegro, said the investment by Allegro would provide additional capital to unlock significant offshore growth potential for Vulcanite. &nbsp;</p> <p>&ldquo;Vulcanite has been capital constrained in recent years, restricting our ability to take advantage of global growth opportunities we have identified.&nbsp;Investing in state-of-the-art design, manufacturing and testing facilities, as well as a stronger offshore sales force will allow us to better leverage Vulcanite&rsquo;s excellent reputation in the global rail market,&rdquo; Mr Anbu said.</p> <p>Allegro Investment Director, Albert Farrant, said: &ldquo;Allegro have been looking at opportunities in the rail sector for some time, as the global and domestic outlook for the rail sector is strong over the medium and long term.&nbsp;We see Vulcanite as an attractive investment because of the strength of its global reputation, the calibre and commitment of the MBO team, and the strong potential for both organic growth and growth through acquisition.&rdquo;</p> <p>ENDS</p> <p><strong><em>Media contact: Chester Moynihan, Joint Managing Director, Allegro Funds, ph. (02) 8228 8700, mob. 0414 395 783 or email</em></strong><a href=""><strong><em></em></strong></a></p> <p><strong><em>About Allegro Funds</em></strong></p> <p><em>Allegro Funds is a growing mid-market private equity fund manager that is independently owned by its principals. Allegro provides capital in order to implement a step change in businesses and invests in both growth investments and turnaround businesses.&nbsp; Allegro&rsquo;s unique investment philosophy has a proven track record for transforming businesses in which it invests, and generating a strong return on investment for institutional investors. For more information, please visit <a href=""></a>&nbsp;</em></p> <div class="wrapper"> <div class="news-item-files"> <div class="news-item-file-title"> <a class="link wrapper link-even" href="" title="Allegro Funds website"><span class="title">Allegro Funds website</span></a></div> </div> </div> 13th Oct 11 GBS Ventures fund achieves global first quartile performance <p><strong>GBS Ventures completes healthcare fund with global first quartile performance</strong></p> <p><strong>Melbourne, Australia</strong></p> <p>GBS Ventures has made the final realisation from its 1998 vintage life science venture capital fund.&nbsp; The fund exceeds top quartile performance metrics based on return on invested capital and distributions to paid-in capital, relative to life science funds in its US peer group raised in 1998.<a href="#_ftn1" title="">[1]</a>&nbsp;Further, the fund delivered investors a premium to the all ordinaries accumulation index, and small ordinaries accumulation index over the period.<a href="#_ftn2" title="">[2]</a></p> <p>&ldquo;This result vindicates our strategy of building world class Australian life science companies to create superior returns for our investors,&rdquo; said Managing Director Brigitte Smith.&nbsp; &ldquo;We are delighted to be able to deliver this result to our superannuation fund and corporate investors.&rdquo;&nbsp;</p> <p>The Australian Bioscience Trust (ABT) helped to build Australian life sciences success stories such as Pharmaxis, Alchemia and Cogstate, all of which are now public and part of the growing and vibrant Australian life science sector.&nbsp; These companies are delivering important products to treat cystic fibrosis and asthma, to help prevent blood clots, and to diagnose central nervous system diseases.</p> <p>&ldquo;GBS provided our founding capital and helped guide us through the highs and lows of biotech product development.&nbsp; Without GBS, our products to treat global respiratory diseases would not have been developed&rdquo; said Dr Alan Robertson, CEO of ASX listed biotech Pharmaxis.</p> <p>The ABT invested in a total of eleven companies, and made the final realisations in the past quarter, with a sale to Wolfson Microelectronics of Dynamic Hearing.&nbsp; Dynamic Hearing is a leading provider of high quality audio Digital Signal Processing technology for personal communication devices such as mobile phones, Bluetooth headsets and hearing aids.</p> <p>Australia has long been a source of globally significant biomedical research, with 5 Nobel prize winners in medicine, and very high rankings in global indices for its research institutions.&nbsp; Dr George Morstyn, chairman of GBS Ventures and former Chief Medical Officer of Amgen, the world&rsquo;s largest biotechnology company, said &ldquo;Now the commercial impact of Australia&rsquo;s high quality research is being realised.&nbsp; GBS takes Australian biotechnology to the world.&rdquo;&nbsp; In the time since the ABT was founded the market capitalisation of the Australian life science sector has grown from $4.8bn to $31.7bn.<a href="#_ftn3" title="">[3]</a>&nbsp; Australia now has the largest listed biotechnology sector as a proportion of GDP in the world.<a href="#_ftn4" title="">[4]</a></p> <p>The Fund was raised under the Australian Government&rsquo;s Innovation Investment Fund (IIF).&nbsp; The&nbsp;IIF is a venture capital program that supports new innovation funds and fund&nbsp;managers with expertise in early-stage venture capital investing. It co-invests with private sector investors in venture capital funds to assist early-stage companies to commercialise the outcomes of Australia&#39;s strong research capability.&nbsp;&nbsp; The objectives of the program were to:</p> <ul> <li>develop fund managers with experience in the early stage venture capital industry by addressing capital constraints and management constraints;</li> <li>encourage the development of new companies that are commercialising research and development;</li> <li>establish, in the medium term, a &lsquo;revolving&rsquo; or self-funding scheme;</li> <li>develop a self-sustaining, early stage venture capital industry in Australia.</li> </ul> <p>Since 1998 GBS has continuously been actively investing in Australian biotechnology.&nbsp; GBS has built a strong team that has worked together for more than a decade, and raised three subsequent funds entirely from private sector investors.&nbsp; GBS has more than $400m under management, its investors include major Australian superannuation funds. &nbsp;The firm is currently seeking new lifescience investment opportunities for its 2008 vintage $122.5m GBS Bioventures IV.&nbsp;&nbsp;</p> <p>The ABT supported development of a number of strong companies that are now exporting products to major global markets, employing Australians in high value life science jobs.&nbsp; The ABT has returned the funds invested by the IIF plus a return that has contributed to making the IIF self-sustaining.</p> <p>&ldquo;The IIF program gave us our start in the venture capital industry, and we believe that we have achieved all of the program objectives. These results demonstrate GBS can build Australian life science companies that export into major global markets, create high value jobs and create products to treat major diseases, and ultimately deliver sustainable returns to our investors,&rdquo;&rdquo; said Managing Director Dr Geoff Brooke.</p> <p><strong>About GBS Ventures</strong></p> <p>GBS Venture Partners (GBS) is a leading Australian life science venture capital firm.</p> <p>Founded in 1996, GBS invests in young businesses developing and commercialising products which, when combined with the right management and finance, will make a significant difference to patients&#39; lives and deliver financial returns to our investors. Our areas of particular interest and expertise include human healthcare, biotechnology product development and life science start-ups. In particular, recent investments have included biological or small molecule therapeutics, medical devices and diagnostics.</p> <p>GBS manages over $400 million across five funds. In March 2009, GBS completed a fund raising for GBS Bioventures IV, a $122.5 million fund&nbsp;which has the capacity&nbsp;to invest up to $10 &ndash; 12 million per investee. Previous funds include:</p> <ul> <li>The Australian Bioscience Trust</li> <li>GBS Bioventures II</li> <li>The Genesis Fund</li> <li>GBS Bioventures III</li> </ul> <p>GBS uses these and other funds under management to make a significant commitment to building life science based companies based on Australasian technology and development capabilities.</p> <p>The GBS team use their experience in life science investing to take an active role at board level in portfolio companies; provide strategic advice and support at all stages of company development; access specialist scientific and technical advice and make introductions to international networks and strategic corporate collaborators.</p> <p>Contact</p> <p>Brigitte Smith</p> <p>Managing Director</p> <p>GBS Venture Partners</p> <p><a href=""></a></p> <p>+61 3 8650 9920</p> <div> <p>&nbsp;</p> <hr /> <div> <p><a href="#_ftnref1" title="">[1]</a> Cambridge Associates LLC, June 2011</p> </div> <div> <p><a href="#_ftnref2" title="">[2]</a>HTM Wilson</p> </div> <div> <p><a href="#_ftnref3" title="">[3]</a>Bioshares, unpublished</p> </div> <div> <p><a href="#_ftnref4" title="">[4]</a> E&amp;Y Beyond Borders global biotechnology report 2010, 2011</p> </div> </div> <div class="wrapper"> <a class="link wrapper link-even" href="" title="GBS website"><span class="title">GBS website</span></a></div> 8th Sep 11 Anacacia Capital fund named a world top performer <p>A vehicle launched by Australia&rsquo;s Anacacia Capital has been named the top performing fund globally by <em>Pensions and Investments</em> magazine. Anacacia Partnership I, which closed in 2007, was judged to be the outstanding performer out of funds raised between 2006 and 2008, based on data collected by Preqin.</p> <p>The fund focuses on investments in small- and medium-sized enterprises and its next vehicle is likely to have a similar mandate.</p> <p>Anacacia has also announced two new investments in height safety provider Roofsafe Industrial Safety Enterprises and hydraulics firm Planet Services Group, respectively. Advisors on the transactions included Thomsons Lawyers, Keystone Lawyers, Ryan Lawyers, Deloitte Touche Tohmatsu, HLB Mann Judd, PricewaterhouseCoopers, Hanrahan and Marsh.</p> <p>Responding to news of the award, Jeremy Samuel, Anacacia&#39;s founder and managing director, said: &quot;It demonstrates that, even during tough times, Australia can generate the very best returns globally from private equity backed small-medium enterprises.&quot;</p> <p>&copy; Asian Venture Capital Journal September 2011</p> <div class="wrapper"> <a class="link wrapper link-even" href="" title="Anacacia website"><span class="title">Anacacia website</span></a></div> 30th Aug 11 Future Fund ups PE holding <p>In releasing its latest <a href="" onclick=";return false;" onkeypress=";return false;">portfolio allocations</a>, the Future Fund&#39;s holding of PE assets now stands at 3.9% of its total assets for the last quarter (at $2.896b), up from 3.4% the previous quarter and from 3% a year ago. FF Board of Guardians Chair David Murray said: &quot;The Board remains focussed on prudently building a diverse portfolio that is capable of generating good returns in positive environments but provides some protection in weaker markets.&quot;</p> 30th Aug 11 Recent VC deals in the news <p>Two recent deals have been in the news. One concerns three VC funds - led by <a href="">OneVentures</a>, with co-investors <a href="" onclick=";return false;" onkeypress=";return false;">Brandon Capital</a>, the <a href="">Medical Research Commercialisation Fund (MRCF)</a> - injecting $15m into Australia&#39;s newest biotechnology start-up, Vaxxas and its needle-free vaccine delivery system, Nanopatch. The other concerns the divestment by Starfish Ventures of Energy Response, an energy management solutions company.</p> <p><strong class="bold">From The Australian Life Scientist:</strong></p> <p>Say &ldquo;hello&rdquo; to Australia&rsquo;s newest biotechnology start-up, Vaxxas. With a fresh $15m boost of venture capital, Vaxxas will seek to develop and commercialise a needle-free vaccine delivery system, Nanopatch.</p> <p>Nanopatch, which is the brainchild of Processor Mark Kendell of the University of Queensland&rsquo;s Australian Institute for Bioengineering and Nanotechnology (AIBN), is a patch smaller than a postage stamp with thousands of small projections designed to deliver a vaccine to abundant immune cells in the skin.</p> <p><a href="" onclick=";return false;" onkeypress=";return false;">Read more.</a></p> <p><strong class="bold">From Starfish Ventures media release:</strong></p> <p><a href="" onclick=";return false;" onkeypress=";return false;">Starfish Ventures</a>, Australia&rsquo;s largest venture capital investor, is confident that the acquisition of <a href="">Energy Response</a> Pty Ltd, by <a href="">EnerNOC</a>, Inc (NASDAQ: ENOC), the world&rsquo;s leading provider of demand response applications and services, has positive implications for Australians.</p> <p>While the carbon debate rages, it is important to look at current renewable energy technology developments in Australia, and where the country can benefit from further investments in the sector, no matter how the debate is resolved.</p> <p><a href="" onclick=";return false;" onkeypress=";return false;">Read more</a>.</p> 24th Aug 11 Australian VC invest in drug development company Spinifex <p>Spinifex Pharmaceuticals, an Australian pain drug development company, has secured a further A$6.25m of venture capital investment from GBS Venture Partners Limited, Brandon Capital Partners Pty Limited, Symbiosis and Uniseed, adding to the previous A$12m raised from the same syndicate in the first part of its Series B round.</p> <p><a class="link wrapper link-even" href="" title="GBS website"><span class="title">GBS website</span></a></p> <p><a class="link wrapper link-odd" href="" title="Brandon website"><span class="title">Brandon website</span></a></p> <p><a class="link wrapper link-even" href="" title="Story on the AltAssets website"><span class="title">Story on the AltAssets website</span></a></p> 19th Aug 11 Venture capital shrinkage needs to be reversed <p>AVCAL has just had published a story entitled &#39;Venture capital shrinkage needs to be reversed&#39; in the August issue of Focus magazine, produced by Australian Academy of Technological Sciences and Engineering (ATSE).</p> <p>The story appears on pages 20-22 of the magazine. Read the PDF story extraction via the link below or go to ATSE&#39;s website to access the August issue (second link).</p> <div class="wrapper"> <div class="news-item-files"> <div class="news-item-file-title"> <a href="/documents/item/290" target="_blank">ATSE VC story - PDF</a></div> <div class="news-item-file-title"> <a class="link wrapper link-even" href="" target="_blank" title="August issue of Focus"><span class="title">August issue of Focus</span></a></div> </div> </div> 5th Aug 11 Life sciences sector shines in Australian PE and VC industry <p>AVCAL has just had published a story entitled &#39;Life sciences sector shines in Australian PE and VC industry&#39; in the latest issue of UK-based Financier Worldwide magazine.</p> <p>The story appears in the magazine&#39;s &#39;Special Report on Private Equity&#39; section and is located on pages 10-11.</p> <p>Click on the link below for a PDF of the special report.</p> <p><a href="/documents/item/291" target="_blank"><span class="title">&#39;Life sciences sector shines in Australian PE and VC industry&#39; story - PDF copy</span></a></p> <p><a class="link wrapper link-even" href="" target="_blank" title="Financier Worldwide website (subscriber site - synopsis only) "><span class="title">Financier Worldwide website (subscriber site - synopsis only) </span></a></p> 13th Jul 11 FY2010-2011 â AVCAL End of Year Review <p><a href="/documents/item/292" target="_blank">FY2010-2011 &ndash; AVCAL End of Year Review</a></p> 21st Mar 11 Australia 7th most attractive country for VC and PE investment <p>Australia is the 7th most attractive country for investors in VC and PE, according to the 2011 Global VC and PE Country Attractiveness Index just released by IESE and sponsored by Ernst &amp; Young.</p> <div class="wrapper"> <div class="news-item-links"> <div class="links"> <a class="link wrapper link-even" href="" target="_blank" title="Read full report here"><span class="title">Read full report here</span></a></div> <div class="links"> <a class="link wrapper link-odd" href="" target="_blank" title="Read the country profile for Australia here"><span class="title">Read the country profile for Australia here</span></a></div> </div> </div> 15th Feb 11 Article by AVCAL Chairman Andrew Rothery in the AFR <p>This article written by AVCAL Chairman Andrew Rothery and published in the Australian Financial Review, compares the experiences of CEOs who have worked for both private equity-backed companies and public companies.</p> <div class="wrapper"> <a class="link wrapper link-even" href="" target="_blank" title="CEOs prefer private equity masters"><span class="title">CEOs prefer private equity masters</span></a>&nbsp;- subscription site</div> 8th Feb 11 Interview of AVCAL Chairman Andrew Rothery by Morningstar <p>In this recent interview by Morningstar, AVCAL Chairman Andrew Rothery talks about the Australian private equity sector, private equity-backed IPOs and industry related tax issues.</p> <p><a class="link wrapper link-even" href="" target="_blank" title="Interview video"><span class="title">Interview video</span></a></p> 31st Jan 11 Private equity rewards pensions <p>The <em>Financial Times </em>reports that new research suggests that the private equity holdings of the world&rsquo;s largest public-sector pension funds outperformed most other asset classes in the short and long term.</p> <p>The 20 largest public pension funds now have an estimated $224bn allocated to private equity deals &ndash; or 5.5 per cent of their capital on average.</p> <p>Their investment have provided strong returns, according to a study by Preqin, an independent research house that focuses on alternative assets.</p> <div class="wrapper"> <a class="link wrapper link-even" href="" target="_blank" title="Read the full article here"><span class="title">Read the full article here</span></a></div> 3rd Dec 10 Article by AVCAL Chairman Andrew Rothery in the Australian <p>This article by AVCAL Chairman Andrew Rothery, published in the Australian, discussed the recently released tax determinations by the ATO.</p> <div class="wrapper"> <a class="link wrapper link-even" href="" target="_blank" title="Private equity investors needs certainty on taxation rules "><span class="title">Private equity investors needs certainty on taxation rules </span></a></div> 4th Mar 10 Minister Sherry speaks on the importance of PE & VC <p>Asst Treasurer Senator Nick Sherry spoke today at the AVCJ conference on the importance of PE and VC financing as part of a diverse investment landscape in Australia.</p> <p>He also spoke of AVCAL&#39;s ongoing engagement with Treasury and said in relation to the recent ATO draft determinations affecting the PE and VC industry, &quot;Government is following this issue closely, and has been consulting widely with industry and other stakeholders. I recently sat down with AVCAL for several hours to listen, in considerable detail, to their views. I can say that it was an important and useful discussion for which I am grateful.As a result of this consultation we now have a very good feel for the issues involved. We will consider stakeholder representations and advice from Treasury and the ATO before deciding what action, if any, may be needed in the coming months.</p> <p>&quot;The Government firmly sees a role for private equity and venture capital in a diverse Australian investment landscape so I hope we can all work together towards just that outcome.&quot;</p> <p><a href="/documents/item/293" target="_blank"><span class="title">Asst Treasurer Senator Nick Sherry - Transcript of speech at the AVCJ</span></a></p> 1st Dec 09 Article by AVCAL Chairman Andrew Rothery in the AFR <p>A recent article written by AVCAL Chairman Andrew Rothery and published in the AFR clears up some of the myths and stereotypes around the Australian private equity industry. The article also talks about the growth strategies used by private equity firms and the current state of the industry.</p> <p><a href="/documents/item/294" target="_blank">Article</a></p> 9th Sep 09 Revised IPEV Guidelines released <p>In May 2009, the IPEV Board called for comments on the exposure draft of the 2009 edition of the IPEV Guidelines. On 9 September 2009, the final revised Guidelines were released.</p> <p>These Guidelines should be regarded as superseding previous Guidelines issued by the IPEV Board, with effect for reporting periods post 1 July 2009.</p> <p>The IPEV Guidelines have been updated to take into account the evolution of fair value accounting requirements and practices around the globe, in particular as promulgated by the Financial Accounting Standards Board (FASB) in the United States and by the International Accounting Standards Board (IASB).</p> <p>The principal changes relate to:</p> <ul> <li>Clarifying how the marketability discount should be applied</li> <li>Eliminating any reference to the one year period used in practice for retaining investments at &#39;Price of Recent Investment&#39; concept, to ensure there are no conflicts with accounting rules</li> <li>Additional guidance on how to include additional milestone analysis into the &#39;Price of Recent Investment&#39; concept</li> <li>Guidance on the valuation of interests in funds.</li> </ul> <p>&quot;To a large extent, the Updated Guidelines are consistent with the prior version,&quot; said Anthony Cecil, IPEV Board member and Partner at KPMG. &quot;Changes were made to eliminate potential confusion and to ensure consistency with converging international accounting standards.&quot;</p> <p>The IPEV Guidelines are drafted to be consistent with IFRS and US GAAP. As US GAAP and IFRS standards continue to evolve in the area of fair value, the Board plans to provide additional updates to the Guidelines.</p> <p>Herman Daems, the IPEV Board Chairman, said &quot;The Updated Guidelines provide practical best practice guidance on valuing private equity investments in a difficult market environment. Fair Value continues to provide the best basis for investors to monitor their portfolio and assist in making key asset allocation decisions.&quot;</p> <p>David Larsen, IPEV Board Member, member of FASB&#39;s Valuation Resource Group and managing director at Duff &amp; Phelps, said &quot;the Updated Guidelines now provide expanded guidance on valuing early stage investments, provide clarity in valuing debt instruments, and provide guidance for valuing LP interests.&quot; In addition, &quot;clarifications areincorporated to highlight the need to determine fair value at each reporting date and ensure that the illiquid nature of investments is appropriately considered,&quot; said Mr Larsen.</p> <div class="wrapper"> <a class="link wrapper link-even" href="" target="_blank" title="View the new Guidelines "><span class="title">View the new Guidelines </span></a></div> <div class="wrapper"> <a class="link wrapper link-odd" href=";url=" target="_blank" title="View the IPEV press release "><span class="title">View the IPEV press release </span></a></div> 17th Jun 09 InvestorDaily: Aussie private equity remains well capitalised <p>Dr Katherine Woodthorpe talks to InvestorDaily about the current state of play in the Australian private equity market. The article also highlights AVCAL&#39;s work among LPs to try to standardise an improved level of reporting and its new annual award for excellence in reporting, which is being judged by a panel of LPs.</p> <div class="wrapper"> <a class="link wrapper link-even" href="" target="_blank" title="Click here to read the article"><span class="title">Click here to read the article</span></a></div> 7th Jul 08 AVCAL: Australia punching above its weight in PE <p>Australia&#39;s relatively tiny population of 20.6 million (0.3% of global population) often manages to contribute one to two percent of most figures in the economic world. The 2007 nominal Gross Domestic Product (GDP) was $908 billion US dollars, representing 1.7% of global output. The Australian Securities Exchange (ASX) contains 2.2% of the value of all the exchanges within World Federation of Exchanges (WFE). The constantly growing Australian Private Equity (PE) industry is no different.</p> <p>From 2003 to 2007 Australian PE raised over $22 billion USD, around 1.4% of funds raised globally during the period. Not surprisingly the United States completely dominates the fundraising statistics, raising nearly 69% of global funds during the five year span.</p> <p><strong>Top 15 Global GDP Countries and their Private Equity Fund Raising</strong></p> <table border="2" cellpadding="0" cellspacing="0"> <tbody> <tr bgcolor="#2f1e0f" valign="top"> <td width="48"> GDP Rank</td> <td width="100"> Country</td> <td bgcolor="#2f1e0f" width="144"> GDP - Nominal<br /> (USD mil)</td> <td bgcolor="#2f1e0f" width="155"> Funds Raised<br /> (USD mil) 2003-2007</td> <td width="134"> Fund Raising Rank</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 1</td> <td valign="bottom" width="100"> USA</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $13,843,825</td> <td valign="bottom" width="155"> $1,068,487.80</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 1</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 2</td> <td valign="bottom" width="100"> Japan</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $4,383,762</td> <td valign="bottom" width="155"> $9,836.50</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 7</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 3</td> <td valign="bottom" width="100"> Germany</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $3,322,147</td> <td valign="bottom" width="155"> $13,282.00</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 6</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 4</td> <td valign="bottom" width="100"> China</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $3,250,827</td> <td valign="bottom" width="155"> $6,358.30</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 11</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 5</td> <td valign="bottom" width="100"> UK</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $2,772,570</td> <td valign="bottom" width="155"> $208,018.00</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 2</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 6</td> <td valign="bottom" width="100"> France</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $2,560,255</td> <td valign="bottom" width="155"> $49,427.90</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 3</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 7</td> <td valign="bottom" width="100"> Italy</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $2,104,666</td> <td valign="bottom" width="155"> $7,073.60</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 10</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 8</td> <td valign="bottom" width="100"> Spain</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $1,438,959</td> <td valign="bottom" width="155"> $4,835.60</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 13</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 9</td> <td valign="bottom" width="100"> Canada</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $1,432,140</td> <td valign="bottom" width="155"> $18,664.40</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 5</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 10</td> <td valign="bottom" width="100"> Brazil</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $1,313,590</td> <td valign="bottom" width="155"> $1,810.50</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 14</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 11</td> <td valign="bottom" width="100"> Russia</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $1,289,582</td> <td valign="bottom" width="155"> $5,472.10</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 12</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 12</td> <td valign="bottom" width="100"> India</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $1,098,945</td> <td valign="bottom" width="155"> $7,298.50</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 9</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 13</td> <td valign="bottom" width="100"> South Korea</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $957,053</td> <td valign="bottom" width="155"> $8,142.70</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 8</td> </tr> <tr bgcolor="#e8f3ff"> <td valign="bottom" width="48"> 14</td> <td valign="bottom" width="100"> Australia</td> <td valign="bottom" width="144"> $908,826</td> <td valign="bottom" width="155"> $22,083.00</td> <td valign="bottom" width="134"> 4</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="48"> 15</td> <td valign="bottom" width="100"> Mexico</td> <td bgcolor="#e0dccd" valign="bottom" width="144"> $893,365</td> <td valign="bottom" width="155"> $172.00</td> <td bgcolor="#e0dccd" valign="bottom" width="134"> 15</td> </tr> <tr bgcolor="#ef4724"> <td valign="bottom" width="48"> <div align="center"> &nbsp;</div> </td> <td valign="bottom" width="100"> Average</td> <td valign="bottom" width="144"> $2,771,367</td> <td valign="bottom" width="155"> $95,397.53</td> <td valign="bottom" width="134"> <div align="center"> &nbsp;</div> </td> </tr> </tbody> </table> <h4><span><strong>Source:</strong> Thomson VentureXpert, IMF, AVCAL</span></h4> <p>In Australian PE over the past five years there has been approximately $1071 raised per person, third only to the United States and the United Kingdom . There is quite a significant gap to the other countries as France is next with only $771 raised per person. The emerging BRIC ( Brazil, Russia, India and China ) economies are also clearly yet to create a substantial private equity market.</p> <p><strong>Private Equity by: Population, GDP and Public Markets</strong></p> <table border="2" cellpadding="0" cellspacing="0" width="595"> <tbody> <tr bgcolor="#2f1e0f" valign="top"> <td width="85"> Country</td> <td width="111"> Funds Raised (USD mil)<br /> 2003-2007</td> <td width="143"> Per Person (USD)<br /> (Pop. as at June 08)</td> <td width="92"> % of GDP &ndash; Nominal (2007)</td> <td width="123"> % of Stock Exchange<br /> (as at May 2008)</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> USA</td> <td valign="bottom" width="111"> $1,068,487.80</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $3,516.79</td> <td valign="bottom" width="92"> 7.72%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 5.54%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Japan</td> <td valign="bottom" width="111"> $9,836.50</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $77.28</td> <td valign="bottom" width="92"> 0.22%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.21%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Germany</td> <td valign="bottom" width="111"> $13,282.00</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $161.25</td> <td valign="bottom" width="92"> 0.40%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.66%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> China</td> <td valign="bottom" width="111"> $6,358.30</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $4.78</td> <td valign="bottom" width="92"> 0.20%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.20%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> UK</td> <td valign="bottom" width="111"> $208,018.00</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $3,413.27</td> <td valign="bottom" width="92"> 7.50%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 5.85%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> France</td> <td valign="bottom" width="111"> $49,427.90</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $771.61</td> <td valign="bottom" width="92"> 1.93%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 1.26%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Italy</td> <td valign="bottom" width="111"> $7,073.60</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $121.65</td> <td valign="bottom" width="92"> 0.34%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.73%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Spain</td> <td valign="bottom" width="111"> $4,835.60</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $119.42</td> <td valign="bottom" width="92"> 0.34%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.26%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Canada</td> <td valign="bottom" width="111"> $18,664.40</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $561.97</td> <td valign="bottom" width="92"> 1.30%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.89%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Brazil</td> <td valign="bottom" width="111"> $1,810.50</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $9.43</td> <td valign="bottom" width="92"> 0.14%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.11%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Russia</td> <td valign="bottom" width="111"> $5,472.10</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $38.89</td> <td valign="bottom" width="92"> 0.42%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.42%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> India</td> <td valign="bottom" width="111"> $7,298.50</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $6.36</td> <td valign="bottom" width="92"> 0.66%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.29%</td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> South Korea</td> <td valign="bottom" width="111"> $8,142.70</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $165.39</td> <td valign="bottom" width="92"> 0.85%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.81%</td> </tr> <tr bgcolor="#e8f3ff"> <td valign="bottom" width="85"> <strong>Australia</strong></td> <td valign="bottom" width="111"> <strong>$22,083.00</strong></td> <td bgcolor="#e8f3ff" valign="bottom" width="143"> <strong>$1,071.95</strong></td> <td valign="bottom" width="92"> <strong>2.43%</strong></td> <td valign="bottom" width="123"> <strong>1.76%</strong></td> </tr> <tr> <td bgcolor="#e0dccd" valign="bottom" width="85"> Mexico</td> <td valign="bottom" width="111"> $172.00</td> <td bgcolor="#e0dccd" valign="bottom" width="143"> $1.56</td> <td valign="bottom" width="92"> 0.02%</td> <td bgcolor="#e0dccd" valign="bottom" width="123"> 0.04%</td> </tr> <tr bgcolor="#ef4724"> <td valign="bottom" width="85"> <em>Average</em></td> <td valign="bottom" width="111"> <em>$95,397.53</em></td> <td valign="bottom" width="143"> <em>$669.44</em></td> <td valign="bottom" width="92"> <em>1.63%</em></td> <td valign="bottom" width="123"> <em>1.27%</em></td> </tr> </tbody> </table> <h4><span><strong>Source:</strong> Thomson VentureXpert, IMF, CIA World Fact Book, WFE, AVCAL</span></h4> <p>As a percentage of GDP and the local public exchanges, the US and the UK clearly represent their more matured PE markets. Averaged over the five years Australian funds raised equate to only 0.49% of GDP per annum, well below the US and UK who both averaged over 1.5% per year. In terms of the Australian Securities Exchange (ASX) the past five years of fund raising equates to 1.76% of total exchange. Even taking into account a generous leveraging multiple (30% equity: 70% debt), this would give the entire industry the power to buy only 5.85% of the exchange, equal to the weight of the UK industry <em>unlevered.</em></p> <h4>Source:</h4> <ul> <li><a href="" target="_blank">Thomson VentureXpert</a></li> <li><a href="" target="_blank">CIA World Fact Book</a></li> <li><a href="" target="_blank">International Monetary Fund</a></li> <li><a href="" target="_blank">World Federation of Exchanges</a></li> </ul> 22nd Feb 12 New AVCAL office - we have moved <p>AVCAL has relocated a short distance to new offices.</p> <p>Our new address is Level 10 Kyle House, 27-31 Macquarie Place, Sydney NSW 2000. Our phone numbers remain the same, although we do not have full phone functionality as yet. Our main office number continues as 02 8243 7000.<br /> &nbsp;</p>