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June Newsletter
15/06/2011
Dear AVCAL Colleague,

AVCAL data collection for two important publications has begun and I ask all our fund members to engage with this process, which is a vital link in our campaign to increase understanding of our industry and the value it adds to the economy. We also have a range of networking and professional development events coming up over the next month. They are almost all full so if you are interested please see details below to secure a place.

The much-anticipated AVCAL IPO study generated widespread media coverage in both mainstream and trade media. The research compared the share prices of PE backed IPOs to those of non-PE backed IPOs over multiple time scales from 2003 to 2010. The results showed that PE-backed IPOs recorded higher share price returns, on average, than non-PE-backed IPOs over all time horizons studied. It was also found that this outperformance appeared to increase over time.

This externally peer-reviewed research helps us educate stakeholders including governments and the media about the value that PE adds to the companies that they own. Our research group is crucial in achieving this objective and a significant portion of your membership subscriptions is spent on increasing the quantity and quality of the research that AVCAL undertakes.

If you have not had a chance to look at the AVCAL End of Year Review, which features highlights and achievements from the 2010-2011 financial year, I encourage you to do so. It has been published on our website and gives an overview of the key activities undertaken on behalf of the PE and VC industry.

As part of this education campaign we have increased our communication activities, for example our recently published AFR letter which was also picked up by subscriber-based PE International Media in the US.

Membership renewals should have reached you just before 1 July via email. Settlement of your subscription within 30 days is appreciated and ensures continuation of the benefits of your membership, including conference attendance. If you have enquiries in relation to your renewal or did not receive it, please contact members@avcal.com.au.

A reminder as well that most membership of AVCAL is held by the organisation, not individuals. It is an organisational membership with individuals linked to that membership. The only exception to this is for a few people who do not represent corporates large or small. Any enquiries can be directed to members@avcal.com.au.

The Annual Conference is nearly upon us, and we are looking forward to seeing many of you on the Gold Coast soon. We have very few places still available, so you had best register now. A reminder that we have a great golf day preceding conference on 20 September. It is a social day but you have to have a conference registration to participate. There is a charge to play. My team can answer any questions in relation to conference. Download the conference program.


Kind Regards


Katherine
Chief Executive
Policy and Advocacy

R&D tax credits

The Government announced the finalisation of the R&D tax credit regime late last month and this week released a consultation package concerning the adminstrative requirements for its implementation. AVCAL issued a media statement welcoming the decision to tighten eligibility requirements such that the such that the limited pool of funds is focussed on those enterprises, large or small, that are carrying out genuine R&D.

New Renewable Energy initiative

As part of its Carbon Tax announcement on Sunday, the Government announced the formation of the Australian Renewable Energy Agency to manage the existing $3.2 billion in R&D funding into renewable energy technologies and initiatives to bring them to market. The new Clean Energy Finance Corporation will also invest $10 billion in businesses seeking funds to get innovative clean energy proposals and technologies off the ground. We look forward to hearing how the new program will unfold.

US fund exemptions

The US Securities and Exchange Commission (SEC) has approved the final rules determining a VC exemption from registration under the Investment Advisers Act, as set out by the Dodd-Frank financial reform legislation. The SEC has defined what qualifies as venture capital investing, while at the same time allowing venture funds a "basket" of 20 per cent of committed capital to invest however they please. More details are on our website.
AVCAL Events

United Malt Holding Case studies
Proudly Partnered by Mallesons Stephen Jaques
Sydney - 20 July 2011. Register now
Brisbane - 11 August 2011. Register now

Peplin Case Study Series
Proudly Partnered by Corrs Chambers Westgarth
Melbourne - 22 July 2011. Register now

PE101
Proudly Partnered by Rothschilds
Sydney - 26 July 2011. SOLD OUT

Only a handful of places left for AVCAL 2011
AVCAL Conference 2011, Gold Coast
Golf 20 September
Conference 21-22 September.
More information here.
Latest Research News

Data collection for the AVCAL Yearbook and Deal Metrics Report has commenced, and we would like to give our GP members a gentle reminder to submit their data by the deadline of 5 August 2011. As members will know, this data is instrumental to our advocacy and research efforts on behalf of the industry. Participating GPs who provide their data will also receive the following additional benefits:

1. Access to more detailed industry data (see www.avcal.com.au/research/data for details).
2. Complimentary pass to an industry statistical briefing by AVCAL following completion of the survey.
3. Customized research reports by request.

Analysis of the performance of PE-backed IPOs in Australia
This report examines how Australian PE-backed IPOs perform relative to non-PE-backed IPOs. The evidence presented in this study suggests that, contrary to many anecdotal reports, PE-backed stocks do not consistently underperform compared to the non-PE-backed stocks, but in fact perform better, on average, over longer horizons.

Towers Watson Global Alternatives Survey 2011
The Global Alternatives Survey covers five alternatives asset classes: real estate; private equity fund of funds; fund of hedge funds; infrastructure and commodities and includes rankings of the top managers in each area. In the private equity and hedge fund area, this ranking is focused purely on fund of funds which have traditionally been of most interest to pension funds.

Australian PE & VC benchmark index for Q4 2010 released
Australian private equity and venture capital continued to generate attractive returns over one-, three- and five-year periods as of the year ended December 31, 2010, when compared with the S&P/ASX 300 Index.

Media Watch

These are links to some relevant stories you may not have seen and a list of "quotable" quotes.

How UK regulatory revamp affects PE
Private Equity International

"According to Montana's calculations, had it placed its private equity allocations into the domestic equities portfolio over the past 16 years, it would be $220.8 million poorer."
Wall Street Journal

"The numbers are out for venture capital fundraising for Q2 2011, and, according to the National Venture Capital Association the data confirms the queasy feeling that entrepreneurs get."
Tech Cocktail

Defending Private Equity From a Flawed Picture - By Steve Klinksy
Dealbook - New York Times

Australian Venture Capital: Ready, Steady, False Start
NewsMaker

Buyouts reassess their Australia risk
Asian Venture Capital Journal

Send us your news!
With deal and fundraising activity picking up, we're keen to ensure our readers can stay up to date with the latest developments on this front. If you are a GP, do send us your news releases on your latest activities, or success stories, and we will be happy to post them up on our website and in future newsletters.
Other Events and Offers

Mines and Money Australia, is the latest in the world famous mining investment series and will be taking place in Sydney from the 10-12 October 2011. Welcoming over 80 mining investment opportunities and over 700 attendees this promises to be a must attend event for both the mining and financial communities. We are pleased to announce that AVCAL members are entitled to a 15% discount on the conference price.
PE Asia special offer
PE Asia is currently offering AVCAL members a 20% discount for new subscribers. Please email PE Asia for more information about this offer. Ensure you quote AVCAL11 to receive this discount. PE Asia and its news website privateequityasia.com provide in-depth news, analysis and insight on the world's fastest growing private equity markets. For more information go to www.peimedia.com/peasia

AIRG AIC Winter Conference 2011 special offer
AVCAL members will be entitled to discounted registration for this conference, jointly hosted by Australasian Industrial Research Group and the Australian Institute of Commercialisation. It will be held at the Sebel & Citigate King George Square, Brisbane, 29-30 August 2011. The topic will be "Next Generation Networked R&D: Tired of one-dimensional answers to complex problems? New thinking about how R&D and Innovation really works in Australasia".
Young Garvan All Ribbons Ball 20 August
This event is a black-tie dinner to raise funds for the Young Garvan Postdoctoral Fellowship, which enables young scientists to broaden their experience by working on a key research project at the Garvan Institute of Medical Research.

The third annual Tech23 23 August 2011, Sydney
Tech23 2011 is a competition for young, innovative and fast-growing Australian companies. 23 of Australia's best will be given a five-minute timeslot to show off their business model to an audience of 400+ potential investors, mentors, entrepreneurs and customers.

Creative Innovation 2011 conference - 16-18 November
Creative Innovation 2011 is a rare opportunity to learn, think, connect and share ideas with over 35 of the world's most influential thinkers under one roof. Inspire your leadership and achieve business success at the conference from 16-18 November at the Sofitel Melbourne On Collins.

Preqin special offer
Preqin is offering AVCAL members the chance to subscribe to their services at a discounted rate. First-time subscribers will receive a USD 250 discount on any product or publication worth USD 1000 or more.

Capital IQ special offer
Capital IQ is currently offering AVCAL members a 2 month free trial for new subscribers.

mergermarket special offer
mergermarket is offering a free trial to AVCAL members and an additional free 2 month access for any subsequent NEW subscribers to the service (14 months for the price of 12).

Guide to Responsible Investment discount
PEI Media's Guide to Responsible Investment provides practical ESG guidance from over 25 industry experts. AVCAL members receive 15% off, quote AVRI15 to redeem.




RESEARCH PARTNERS

Ernst & Young

Pacific Strategy Partners


AVCAL 2011 PARTNERS

Castle Harlan

Advent

Gallagher

NAVIS

AON

KKR

Ironbridge

CATALYST

Archer Capital

TEST CBA 3

BOS International

Champ Private Equity

Quadrant

INVESTEC

KPMG

Intralinks

Riverside Company

Pacific Road Capital Management

Propel Investments

Credit Suisse

Pacific Equity Partners

LEK

Norton Rose

NBC Capital

Westpac

ROTHSCHILD

McGrathNicol


DATA VENDOR

Capital IQ

Disclaimer:

AVCAL is the professionally managed industry body that promotes the Australian private equity & venture capital industry.

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