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Future Trends in Private Equity Jim Sloane, Deloitte

We believe that private equity’s greatest growth is yet to come Apax Partners, April 2006

We believe that private equity’s greatest growth is yet to come Risks Stimuli Debt Market Interest rates Corporate collapse Economies slow down Exit values plunge Overpriced assets Low interest rates Stable regulatory environment Liberal policies towards Private enterprise Entrepreneurship New markets Delisting Strong debt market We believe that private equity’s greatest growth is yet to come Apax Partners, April 2006

Fund Sizes 8/9 funds in excess of $8 billion Blackstone - $15 billion Permira - $12 billion 3 or 4 year duration No issues raising funds

We believe that private equity’s greatest growth is yet to come Apax Partners, April 2006 Barbarian at the gates Disposals Financial Engineering & Arbitrage Active Ownership (Jack Welch Lou Gerstner Lord Hollick Vivek Paul Millard Drexler)

Barbarian at the gates Disposals Financial Engineering & Arbitrage Active Ownership Public companies delisting Ownership Power to restructure New management Reward Leverage full debt capacity Talent flow Increasing financial scale FTSE 100 companies as targets

ACTIVE OWNERSHIP Club deals Management Teams Maturity of the business Scale Opportunity Strategic Buyers Returns from going private Owners as supervisors and managers

Strategy, Vision, Mission Opportunistic V. Growth Capital already invested Exploit new opportunities Agents for change Buy, Build, Improve, Grow Low hanging fruit taken

Implications Increasingly important part of the economy Stimulus for growth? Private ownership delivers more? Risk of tackling operational issues Succession planning Continual flow of M&A activity (all sizes)

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