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Venture-Backed Exits Enjoyed Higher Average Values on Lower Total Volumes in 2012 Both IPO and Acquisition Quality Improved as Market Uncertainty Slowed Transactions in the Second Half of the Year


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© Marketwire 2013
2013-01-02 14:14:49 -

NEW YORK, NY -- (Marketwire) -- 01/02/13 -- Venture-backed initial public offering (IPO) activity raised $1.4 billion from eight offerings during the fourth quarter of 2012, a slight decline in volume from the third quarter of this year but a 23 percent increase in dollars raised compared to the previous quarter, according to the Exit Poll report by Thomson Reuters and the National Venture Capital Association (NVCA). For full year 2012, venture-backed initial public offerings raised $21.5 billion from 49 listings, and driven by the Facebook offering, represented the strongest annual period for IPOs, by dollar value, since 2000. For the fourth quarter of 2012, 95 venture-backed M&A deals were reported, 26 of which had an aggregate deal value of $3.5 billion, a 57 percent decrease from the third quarter of 2012. Acquisitions of venture-backed companies totaled $21.5 billion for full year 2012, an 11 percent decline from full year 2011.



"While the venture capital and startup communities were optimistic about a more robust IPO market in 2012, political, economic and market conditions served as the backdrop for a series of fits and starts which hurt volume growth throughout the year for public offerings and acquisitions alike," said Mark Heesen, president of the NVCA. "Yet, while increased volumes remained elusive, the overall quality of exits this year was quite strong, and certainly sends a message that the market is receptive and open for business in 2013."



  --------------------------------------------------------------
                   Total     M&A Deals with  *Total Disclosed
  Quarter/Year    M&A Deals Disclosed Values  M&A Value ($M)
  --------------------------------------------------------------
  2007               488              200               30,745.5
  --------------------------------------------------------------
  2008-1             129              43                 5,201.6
  --------------------------------------------------------------
  2008-2             102              28                 3,145.2
  --------------------------------------------------------------
  2008-3             109              40                 5,248.8
  --------------------------------------------------------------
  2008-4             76               23                 2,641.3
  --------------------------------------------------------------
  2008               416              134               16,236.9
  --------------------------------------------------------------
  2009-1             80               19                   830.5
  --------------------------------------------------------------
  2009-2             77               14                 1,982.4
  --------------------------------------------------------------
  2009-3             96               30                 2,224.3
  --------------------------------------------------------------
  2009-4             98               45                 7,327.7
  --------------------------------------------------------------
  2009               351              108               12,364.9
  --------------------------------------------------------------
  2010-1             146              36                 4,945.1
  --------------------------------------------------------------
  2010-2             108              30                 2,681.4
  --------------------------------------------------------------
  2010-3             133              36                 4,140.9
  --------------------------------------------------------------
  2010-4             134              47                 5,932.8
  --------------------------------------------------------------
  2010               521              149               17,700.3
  --------------------------------------------------------------
  2011-1             135              51                 5,966.8
  --------------------------------------------------------------
  2011-2             92               37                 6,202.3
  --------------------------------------------------------------
  2011-3             139              43                 6,934.5
  --------------------------------------------------------------
  2011-4             122              38                 4,989.6
  --------------------------------------------------------------
  2011               488              169               24,093.2
  --------------------------------------------------------------
  2012-1             112              28                 3,671.0
  --------------------------------------------------------------
  2012-2             118              31                 6,180.2
  --------------------------------------------------------------
  2012-3             110              35                 8,088.8
  --------------------------------------------------------------
  2012-4             95               26                 3,523.2
  --------------------------------------------------------------
  2012               435              120               21,463.2
  --------------------------------------------------------------


  ------------------------------------------------------------------------
                  *Average M&A                               Average IPO
                    Deal Size  **Number of    Total Offer    Offer Amount
  Quarter/Year        ($M)         IPO's       Amount ($M)        ($M)
  ------------------------------------------------------------------------
  2007                  153.7       92             12,365.5          134.4
  ------------------------------------------------------------------------
  2008-1                121.0       6                 577.5           96.3
  ------------------------------------------------------------------------
  2008-2                112.3       0                     0            0.0
  ------------------------------------------------------------------------
  2008-3                131.2       1                 187.5          187.5
  ------------------------------------------------------------------------
  2008-4                114.8       0                     0            0.0
  ------------------------------------------------------------------------
  2008                  121.2       7                 765.0          109.3
  ------------------------------------------------------------------------
  2009-1                 43.7       0                     0            0.0
  ------------------------------------------------------------------------
  2009-2                141.6       7                 997.6          142.5
  ------------------------------------------------------------------------
  2009-3                 74.1       2                 522.5          261.3
  ------------------------------------------------------------------------
  2009-4                162.8       4                 459.7          114.9
  ------------------------------------------------------------------------
  2009                  114.5       13              1,979.8          152.3
  ------------------------------------------------------------------------
  2010-1                137.4       8                 921.9          115.2
  ------------------------------------------------------------------------
  2010-2                 89.4       18              1,548.4           86.0
  ------------------------------------------------------------------------
  2010-3                115.0       17              1,996.0          117.4
  ------------------------------------------------------------------------
  2010-4                126.2       25              3,142.8          125.7
  ------------------------------------------------------------------------
  2010                  118.8       68              7,609.1          111.9
  ------------------------------------------------------------------------
  2011-1                117.0       14              1,526.9          109.1
  ------------------------------------------------------------------------
  2011-2                167.6       21              5,883.5          280.2
  ------------------------------------------------------------------------
  2011-3                161.3       5                 475.9           95.2
  ------------------------------------------------------------------------
  2011-4                131.3       11              2,803.2          254.8
  ------------------------------------------------------------------------
  2011                  142.6       51             10,689.5          209.6
  ------------------------------------------------------------------------
  2012-1                131.1       19              1,682.8           88.6
  ------------------------------------------------------------------------
  2012-2                199.4       12             17,219.1         1434.9
  ------------------------------------------------------------------------
  2012-3                231.1       10              1,140.7          114.1
  ------------------------------------------------------------------------
  2012-4                135.5       8               1,408.4          176.1
  ------------------------------------------------------------------------
  2012                  178.9       49             21,451.2          437.8
  ------------------------------------------------------------------------

  Source: Thomson Reuters & National Venture Capital Association
  *Only accounts for deals with disclosed values
  **Includes all companies with at least one U.S. VC investor that trade
  on U.S. exchanges, regardless of domicile.






IPO Activity Overview



There were eight venture-backed IPOs valued at $1.4 billion in the fourth quarter of 2012. By number of deals, quarterly volume fell 20 percent from the third quarter of this year but increased 23 percent compared to the value registered during the third quarter of 2012.



Five of the eight IPOs of the quarter were IT-related IPOs representing 63 percent of the total issues for in the quarter. By location, seven of the quarter's eight IPOs were by U.S.-based companies with China-based YY, Inc., an operator of an online game community, rounding out the quarter's listings.



In the largest IPO of the quarter, Workday, Inc. (WDAY), a Pleasanton, California-based developer of human resource enterprise solutions, raised $733 million and began trading on NASDAQ on October 11th.



    -------------------------------------------------------------------
                                                    Q4 2012
    -------------------------------------------------------------------
                                          *Number of
                                        Venture-Backed  Total Venture-
                                         IPO's in the   Backed Offering
                  Industry                   U.S.          Size ($M)
    -------------------------------------------------------------------
                   Computer Software
                   and Services                1                  732.6
                   ----------------------------------------------------
                   Internet Specific           2                  235.5
                   ----------------------------------------------------
                   Communications and
                   Media                       1                  126.0
                   ----------------------------------------------------
                   Semiconductors/Other
                   Elect.                      1                   41.4
    Information    ----------------------------------------------------
    Technology                                 5                1,135.4
    -------------------------------------------------------------------
                   Biotechnology               2                  167.2
                   ----------------------------------------------------
    Life Sciences                              2                  167.2
    -------------------------------------------------------------------
                   Industrial/Energy           1                  105.8
                   ----------------------------------------------------
                                               1                  105.8
    -------------------------------------------------------------------
                                  TOTAL        8                1,408.4
    -------------------------------------------------------------------




Source: Thomson Reuters & National Venture Capital Association
*Includes all companies with at least one U.S. VC investor that trade on U.S. exchanges, regardless of domicile



For the fourth quarter of 2012, five companies listed on the NASDAQ stock exchange and three companies listed on the New York Stock Exchange. During full year 2012, 30 companies listed on the NASDAQ stock exchange, while 18 listed on the New York Stock Exchange and one listed Over-the-counter.



Seven of the eight companies brought to market this quarter are currently trading above their offering price. Of the 49 offerings for the year, 30 are trading above their offering price. There are 27 venture-backed companies currently filed publicly for IPO with the SEC. This figure does not include confidential registrations filed under the JOBS Act.



Mergers and Acquisitions Overview



As of December 31st, 95 venture-backed M&A deals were reported for the fourth quarter of 2012, 26 of which had an aggregate deal value of $3.5 billion. The average disclosed deal value was $135.5 million, a three percent increase from the fourth quarter of 2011.



The information technology sector led the venture-backed M&A landscape with 65 of the 95 deals of the quarter and had a disclosed total dollar value of $1.6 billion. Within this sector, Computer Software and Services and Internet Specific deals accounted for the bulk of the targets with 33 and 23 transactions, respectively, across these sector subsets.



###PRECONTENT2###



Source: Thomson Reuters & National Venture Capital Association



The largest venture-backed M&A transaction completed during the fourth quarter of 2012 was Cisco Systems $1.2 billion purchase of Meraki, Inc, a San Francisco California-based developer of solutions for the deployment of wireless networks.



Deals bringing in the top returns, those with disclosed values greater than four times the venture investment, accounted for 58 percent of the total disclosed transactions during fourth quarter of 2012, on par with the third quarter of this year. Venture-backed M&A deals returning less than the amount invested accounted for 21 percent of the quarterly total.



###PRECONTENT3###



About Thomson Reuters



Thomson Reuters is the world's leading source of intelligent information for businesses and professionals. We combine industry expertise with innovative technology to deliver critical information to leading decision makers in the financial and risk, legal, tax and accounting, intellectual property and science and media markets, powered by the world's most trusted news organization. With headquarters in New York and major operations in London and Eagan, Minnesota, Thomson Reuters employs approximately 60,000 people and operates in over 100 countries. Thomson Reuters shares are listed on the Toronto and New York Stock Exchanges. For more information, go to http://thomsonreuters.com : ctt.marketwire.com/?release=970199&id=2433166&type=1& .. .



About National Venture Capital Association



Venture capitalists are committed to funding America's most innovative entrepreneurs, working closely with them to transform breakthrough ideas into emerging growth companies that drive U.S. job creation and economic growth. According to a 2011 Global Insight study, venture-backed companies accounted for 12 million jobs and $3.1 trillion in revenue in the United States in 2010. As the voice of the U.S. venture capital community, the National Venture Capital Association (NVCA) empowers its members and the entrepreneurs they fund by advocating for policies that encourage innovation and reward long-term investment. As the venture community's preeminent trade association, NVCA serves as the definitive resource for venture capital data and unites its nearly 400 members through a full range of professional services. For more information about the NVCA, please visit www.nvca.org : ctt.marketwire.com/?release=970199&id=2433169&type=1& .. .




CONTACTS

Emily Mendell
NVCA
1.610.565.3904
emendell@nvca.org :

Lauren Herman
Thomson Reuters
1.646.223.5985
lauren.herman@thomsonreuters.com : docid: 13970199.nitf -->



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