Nordic Private Equity

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Nordic Private Equity

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Our strategy

• We only invest in private equity funds and always
  in minority
• Committing resources and energy to research
  international best practice of fund management
• Building a balanced Nordic portfolio
• Co-operating with selected international
  investors who seek a Nordic PE exposure
• Co-invest, manage or advise

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Argentums portfolio
Overweight in energy and venture compared to
Nordic and European investors
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Nordic Private Equity A growth market
Sources EVCA, 2006 NTNU/NUTEK/Argentum/Vækstfond
en, 2006
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PE investors Norway vs. Europe
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Fundraising - Nordic Development
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Fundraising 2006
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Fundraising Nordics vs Europe
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Assets under management
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PE investments - of Nordic
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PE investments - MEur
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PE investments - Venture and Buyout
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Nordic PE investments 2006 by stage
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Nordic PE investments 2006 by industry
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Room for insitutional investors
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The Nordic Private Equity Market developing
market with attractive opportunities

• Strong underlying market fundamentals and a
  large number of
• potential venture initiatives and acquisition
  candidates
• Strong GDP growth with positive outlook (4 over
  next 2 years)
• Relatively broad and transparent financial
  markets
• Strong deal flow, investment and RD activity
• Increased cross-border activity
• Fragmented, well-diversified industry base
• Broad potential exit alternatives
• The market is becoming Nordic, but national
  attributes exists to pursue
• Sweden has the most mature and sophisticated
  private
• equity markets
• Rank 2nd in Europe in terms of of GDP

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National attributes
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The Nordic Buyout Market

• The region offers traditional and stable industry
  sectors for a well-diversified portfolio of
  investments
• Experienced, entrepreneurial management teams
• Unique franchises, distinctive products or
  services
• National oriented business models to expand upon
  gives significant growth potential through
  regional add-on acquisitions
• Potential exit routes through trade sales or IPO
• Enterprise values typically between 50-250
  million
• Currently high entry multiples, in particular in
  the large-cap segment

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The Nordic Technology Venture Opportunity

• The region offers strong underlying technology
  market fundamentals and broad investment
  universe
• Nordic technology sector accounts for 10 of
  total European
• technology market and is only second to the
  UK
• Innovative leader in Europe with high levels of
  RD an IT spending
• - Electrical and optical equipment
• - ICT
• - Computer services
• - Oil exploration and development (space under
  water)
• Region drives value shift from hardware towards
  software
• Consolidation of funds since dot.com bubble has
  had positive impact on
• quality of deal-flow and fund strategies

Source Eurostat Yearbook
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The Nordic PE Market strong BO results, but
Dot.com negative impact on VC
Source ProVenture based on Venture Expert
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The Nordic PE Market Characteristics of the
Swedish PE Market

• Buyout
• Average annual volume of Buy-out deals 10-15
  deals
• Strong activity in large-cap buy-out segment,
  and very good deal flow in
• mid-cap segment underserved mid/small-cap
  segment?
• Many family owned companies are coming up for
  sale in the coming years due
• to generation shifts
• Currently high Entry Multiples, in particular in
  the large-cap segment
• Proprietary deals gt60 of total
• Swedish buy-out players
• EQT, Industri Kapital, Procuritas, Accent,
  Nordic Capital,
• Segulah, Ratos
  and Altor
• Venture
• Benefits from strong innovative national
  clusters in ITC
• - Corporate spin-off possibilities
• Both Industrial (OEM) and Business to Business
  segments
• .Infrastructure, Applications and services
• Driven by IT outsourcing and focus on core
  competency

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The Nordic PE Market Characteristics of the
Norwegian PE Market

• Buyout
• Average annual volume of Buy-out deals 5-10
  deals (but strong growth)
• Largest industry segment includes oil and gas,
  shipping, fish/marine farming,
• and process industry
• Significant number of family owned companies
• Currently High entry multiples, in particular
  larger mid cap deals (EV 150m)
• Strong deal flow, Proprietary deals gt70 of
  total
• Norwegian buy-out players
• Norvestor, FSN Capital, HitecVision PE, Borea,
  Ferd, Reiten
• Venture
• Benefits from strong innovative national
  clusters in energy and marine sectors
• Focus on Business to Business segments
  hardware and software applications
• and services
• Driven by IT outsourcing and focus on core
  competency
• Strong IPO market

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The Nordic PE Market Characteristics of the
Finnish PE Market

• Buyout
• Average annual volume of Buy-out deals 8-12
  larger deals
• Strong industries in Finland paper forestry,
  metal engineering,
• telecommunications (Nokia effect)
• A lot of family owned companies are coming for
  sale in coming years due to the
• generation shift (very sharp ageing curve in
  Finland)
• Still truly proprietary deals, but auctions are
  becoming common
• Finnish buy-out players
• CapMan, MB-Funds, Sponsor, and Swedish players
  like EQT,
• Industri Kapital, Nordic Capital (and Altor)
  in larger transactions
• Venture
• Benefits from strong innovative national cluster
  around telecommunications
• (Nokia effect)
• Strong industrial Financed RD activity
• .Infrastructure, Applications and services
• Weak IPO market for exit

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The Nordic PE Market Characteristics of the
Danish PE Market

• Buyout
• Average annual volume of Buy-out deals 5-7
  deals (approx.1/3 of the Swedish)
• Danish industrial structure is relatively
  private
• Due to shift of generations several family
  companies will be for sale in years to
• come
• Strong de-listing potential
• Currently high entry multiples
• Predominantly controlled auctions 80-85 of
  all transactions
• Danish buy-out players
• Axcel, Polaris, FIH/LD and Odin. EQT, Industri
  Kapital,
• Capman, Nordic Capital and Altor in large-cap
  segment
• Venture
• Innovative clusters in IKT (30) and Life
  Science (52) sectors
• Early phase focus

Buy-out-investeringer
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Venture or buyout?
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Your Professional Partner in Nordic Private Equity