2012 Private Equity Exclusive

Mid-Year Investor Outlook – Highlights from the latest Global Private Equity Barometer

• LP Appetite and Returns for Private Equity
• Fund Terms and Conditions
• Distributions Forecast
• Private Equity Valuation Predictions

"Stuck in the Middle? 

Maybe not so bad"

Fund of Funds

• Fundraising Statistics and Declining Fund Size
• What is the Main Investor Rationale for using Private Equity Fund of Funds?
• Pros and Cons of Fund of Funds
• Performance of Fund of Funds vs. Direct – Statistical Comparisons
• Mitigating Risk – what are the key Diversification Parameters?
• Selecting a Fund of Funds Manager – Due Diligence, Key Criteria
• What are the Points of Distinction between an Upper Quartile Manager and the Median?
• Explain Emerging and Future Trends such as Specialization, Niche Strategies, Separate Accounts, etc.
• Consolidation – Inevitable and to what Extent?

Emerging Markets

• What Major Developments have we seen over the Past Year?
• What would be the Effects on Emerging Markets if we see a Recession in Developed Markets?
• BRIC Counties – GDP, Growth, Debt and Reserves in comparison to Developed Markets   
• What is the Primary Driver of Increasing Emerging Market PE Commitments?
• How have Emerging Market Returns stacked up to Developed Markets?
• Identifying and Managing Barriers/Risks specific to Emerging Markets – has it improved?
• What do the Exit Strategies look like in Emerging Markets?
• Choosing an Emerging Markets Fund or Manager
• Should you be Investing in Regional Funds, Country Specific Funds or Sector Funds?
• Which Countries offer the Best Opportunities and Returns?
• China – Slowdown or Hard Landing?
• What are the Success Factors for LPs Investing in Asia?
• Competitive Pricing – are Investors Chasing Higher Valuations for Entry into the Asian Market?  
• Making the case for Frontier Markets – Diversification, Low Correlation to Developed Markets
• Prospects for MENA – which Sectors make sense?
• Is there a MENA Capital Drought?
• Barriers/Risks to MENA - Political, Currency, Corruption, Limited Research/Number of GPs, Low Liquidity, etc.

Emerging Managers (Discussion)

• Why are Plan Sponsors establishing Emerging Manager Programs?
• How are Plans defining Emerging Managers?
• What are the Benefits & Opportunities offered by Investing in Emerging Managers?
• What are the Growth Prospects?
• Exploiting Price Inefficiencies by utilizing Emerging Managers
• What form do the Programs take?
• How is Establishing this type of Program different from others?
• Due Diligence and Key Points of Analysis for Selecting Emerging Managers
• New Firms/Emerging Manager Fundraising – how important is it to be spun out from Traditional or Name-Brand Firms?
• Procedures for Monitoring Emerging Managers
• Explain the Perceived Risk of Investing in Emerging Managers and why it’s Inappropriate
• Relying Less on Leverage
• How do you Measure Success?
• What is an important Lesson Learned from your Experiences?

Welcome Reception

Welcome Reception Concludes

Private Equity Portfolio Diagnostics

• Portfolio Management Issues
• What is your Optimal Allocation to Private Equity?
• Cash Flow and Valuation Forecasting
• Optimal Commitment Pacing
• How does your Performance compare to your Private and Public Market Benchmarks?
• What Generated your Performance?
• Is your Portfolio sufficiently Diversified and Performing as Expected?
• What is your Risk/Return Profile?
• Prospective Managers – will they Decrease your Portfolio’s Risk through Diversification and add to its Return?

FEATURED PANEL:

Current State of the Private Equity Market, (Discussion)

(A) Fundraising Environment

• What Sectors seem to attract the most Interest?
• What are the Characteristics of those who are successfully able to Raise Funds?
• Survival of the Fittest and Trend of Committing More Capital to Fewer Managers – how extreme will the GP Shakeout be?
• Trend of Big LPs committing to special GP Arrangements with Managed Accounts – how will it affect the Industry?
• Key to Fundraising for Fund of Funds – Returns or Specialization?
• Are you still seeing LPs Scale Back Commitments to previously Closed Funds?
• Fundraising Extension Requests – just how common has it become and will it continue?
• Are Succession Issues a main Factor for Turning Down Reinvestment/Re-Ups?
• New Firms/Emerging Managers – what is the Criteria seen for Good Fundraising Results?
• Do you believe there to be a Predictive Capital Call Scheduling Model via Timing, Distributions and Public Market Performance? 
• Are you or your Clients getting more Distributions than Capital Calls?
• Will Sovereign Wealth Funds play a Larger Role in Buyout Fundraising with questions surrounding Banks and Insurers as future Sources of Capital?

(B) LP/GP Relationship – Fees, Terms and ILPA Principles

• Are LPs willing to Pay Higher Fees for Managers with the Best/Proven Track Records?
• Will Performance or Incentive Based Fees be more likely in the Future?
• What is “European Waterfall” and do you expect it to become more common in order to be more Investor Friendly?
• Do you believe GPs should Invest more in their Own Funds to Achieve a Greater Alignment of Interests?
• As an LP, would you consider Not Investing in a Fund if it did Not Conform to ILPA Principles?
• Do you believe that Adopting ILPA Principles will help you bring in more assets?
• Any Advice for GPs in approaching the ILPA Guidelines?
• ILPA Standardized Reporting – does it Create Transparency will it become Universal?
• Do you believe that IRR Overstates True Returns?  If so, why and what other Metrics can be used in Measuring Performance?

(C) Investment and Exit Environment

• The State of the Economy – what is your Outlook and Expectations for its effects on Private Equity?  What is your Biggest Worry?
• Capital Overhang/Dry Powder – does it still concern you?  Have GPs been Disciplined or have they been Pushing out Investments Creating Poor Decisions?
• How are you Financing Transactions today? Has the Buyout Financing Market Frozen up with few new Large Deals being Underwritten?  Could Mezzanine Benefit?
• Wall of Debt Coming Due – have Distressed Opportunities been pushed out?
• Expectations for Co-Investment – likely to become more prevalent?
• Is the Venture Model Broken?
• What will be the Delayed Impact of the Volcker Rule?  Will the Divestment Period and Availability for Extensions create a Boost to Secondary Market Activity in 2-5 years?
• Expectations for the Exit Market
• Shift Away from IPOs and M&As – what Conclusion can you Draw?
• Niche Strategies – which ones are most Appealing?
• Which Strategies are offering Shorter Time Horizons, Cash Yields and Greater Liquidity?
• How common has it become for GPs address ESG Issues to create maximum Value and meet LP Expectations?
• Where do you expect that we’ll see the Best Returns over the next Five Years?  

Refreshment Break

Buyouts, (Discussion)

• What are your Expectations for Deal Flow Volume?
• How will the Investment Pace look like with the Impact of the PE Overhang?
• What Types of Deals will be most Prevalent? Public-to-Private, Secondary Buyouts, Corporate Spin-Offs, Large vs. Small?
• What are the Most Appealing Sectors and Geographies?
• Do you see Opportunities in Europe?
• What Trends do you see taking place in Financing to get Deals Done for now and the future?
• Is Credit Risk being Re-priced and is Credit Tightening for an Extended Period?
• Are Large Deals Difficult to Finance?  Has this led to more Smaller Deals?
• Prospects for Small, Middle and Large Buyouts
• What are the Drivers Creating Value?  Is Market Timing the Biggest Factor?
• Are GP Operational Teams Growing and becoming an LP Demand for Improving Current Portfolios?
• Are the Impacts of Public Market Performance and a Stable Economy the most important Factors/Challenges for Future Valuations?
• Expectations for Capital Calls
• Expectations for Exits/Distributions
• What have you Identified and Learned from recent Successful Exits?
• Will PE Firms continue to hold onto Companies for a Longer Period of Time?
• Is much of the Increase in Portfolio Company Sales Activity mostly Among PE Firms?
• Upcoming Shakeout – Do you expect we’ll see more of the “Living Dead” or "Zombie" firms that Can’t Raise a New Fund?
• How are LPs dealing with the wave of Fund Extensions?
• Will Annex or Top-Up Funds catch on or do you see it as Throwing Good Money after Bad?
• What are the Problems you see in the GP Space that you would correct or what would you encourage LPs to look for?

Co-Investments

• Will Co-Investments continue to gain more Attention from Pension Plans?
• Reasons why Co-Investments are Attractive to LPs
• Do you believe offering Co-Investments are a GP Incentive for LPs to participate in their next Fundraising?
• Are most Pension Plans likely to only Co-Invest with Firms with an Existing Relationship?
• Approach and Criteria for Co-Investments
• Where do Co-Investments make the most sense?
• Understanding the Trends and Performance of Co-Investments in Small, Medium and Large Buyouts
• Staffing and Man-Power Concerns
• What are the Success Factors for LPs?
• What can you do to Protect against Unintended Results within the Co-Investment Partnership Arrangement?

Secondaries, (Discussion)

• Reasons why Pension Plans are turning to the Secondary Market – what has been the recent Seller Motivation?
• Are Banks the Biggest Sellers?
• Current Volume of Secondary Activity
• What Forces are behind the Bid-Ask Spread?
• What sort of Discounts are we seeing on the Secondary Market and do you expect Valuations to Flatten or Decline?
• Volcker Rule – will the Divestment Period and Extensions create a Delayed Boost to Secondary Market Activity?
• Supply/Demand – is there too much or not enough Secondary Capital given Current Deal Flow?
• What is a Synthetic Secondary?  What is the Origin of the Investment Team?
• What are the Benefits of Synthetic Secondaries?
• How should LPs get Exposure to the Secondary Market and what are successful Buy Strategies?
• What should LPs consider when Liquidating portions of their Private Equity Portfolio?
• What is the Role of the GP in the Secondary Market and how has that changed over time?
• What are the Risk/Return Characteristics of Secondaries vs. Private Equity in general?

Mezzanine Debt Investing

• Private Equity Overhang to Benefit Mezzanine?  What are your Views for this Cycle?
• Tightening of Credit from Banks – will Mezz continue to become more prominent?
• The Need for Mezz Capital – is there a Shortfall creating Favorable Conditions?
• Mezz Stability – Peak to Trough Drawdown during the Financial Crisis compared to PE Sub-Sectors and other Asset Classes
• Do you consider Mezz to have an Attractive Risk/Return Profile and why?
• Important Non-Correlation Factor
• How are Deals being Structured and Priced?
• Understanding PIK – when should it be used and avoided?
• What does the Cash Flow Model and Return Structure look like?  J-Curve Minimization?
• Issues, Competition, Liquidity, Pricing and Returns Expectations
• Risk/Reward of Micro, Middle, and Large Market
• Is the Lack of Institutional Data and Coverage of the Mezzanine Asset Class an Obstacle?
• Will BDCs continue to become more Common?  What are the Benefits for Managers?  Any Downside for LPs?

Lunch

Distressed Investing, (Discussion)

• Where are we in the Distressed Cycle?  How much of the Opportunity has passed and how much remains?
• What’s Different about this Cycle?
• Have the Capital Markets Activity fixed a good portion of the Maturity Wall Problem?
• How are you deploying Capital in Distressed Strategies today?
• Pitfalls of the Economy for Investing now?
• Ongoing Deleveraging – what Sectors will create the Best Opportunities in the coming years?
• Distressed Opportunities in Europe and the high level of Leveraged Loans Due
• How can Pension Plans take advantage of Opportunities?
• Are Buyout Firms still moving into Distressed Deals?
• Overview of the Risks
• Which do you see as the Best Strategy: Passive, Control or Non-Control?
• What should a Pension Plan look for in a Distressed Manager?  Skill Set?

Credit Strategies, (Discussion)

• What is the Current State of the Credit Market?
• How will this Credit Cycle play out and can you Profit from Credit Funds for several years to come?
• Debt coming Due from Amend-and-Extend – how should Investors be Positioned?  Are we still seeing Maturity Extension requests?
• LBO Volume – effects of Money Raised during the Boom being put to work
• What is the Current State of the Securitization Market? Has it Seized Up and what are the Opportunities?
• RMBS/CMBS Market Overview
• CLO Reinvestment Challenge
• Are you Cautious on High Yield?
• European Debt Crisis – what will be the Impact and Opportunity Set?
• What Lessons Learned should be taken away from 2007-2008?
• How has the Competition (Fixed Income, Hedge Funds, etc.), altered the Market?
• How should Pension Plans go about Analyzing, Selecting and Implementing the various Credit Funds?
• Considerations for Selecting a Manager
• How do you Manage a Credit Program in a Volatile Market?
• What Sub-sectors of Credit are the most Attractive Opportunities?  What are your Best Ideas for finding Value?

Refreshment Break

Venture Capital

• State of the Venture Industry and Fundraising Environment
• Will we see Smaller Sized Allocations into Venture?
• Status of the Exit Market and IPO Pipeline 
• Exit Market Shift to M&A?
• What is the Average Investment to Exit Timeframe?
• Are we more likely to see Money going into Late-Stage or Early-Stage and why?
• Outperformance of Smaller Funds – a continuing Trend?
• Venture Capital Winners – Concentrated within the Top Few Firms?
• Social Media – Bubble or Sustainable Investment Theme?
• Overseas VC Outlook. IPO Growth in China?
• Are Funding Models changing to get Cash Flowing again?
• Understanding Venture Returns – Underperformance when Investing at Market Peaks vs. Outperformance when Investing at Market Troughs
• Do you believe that some VC Firms are attracting Capital based on their Reputation from the last Tech Boom?

CleanTech

• Cleantech Market Overview
• Fundraising Trends
• Investment Trends – which Technologies or Sectors look the most Promising? Which ones are seeing the most Funding?
• Energy as a Supporting Factor for Cleantech
• What Effects are Government Funding Programs and Corporate Investments playing on the Industry?
• Are we seeing a Shift away from Early-Stage Investments?
• Institutional Approaches to the Sector
• Challenges/Obstacles
• The Exit Outlook

Private Equity Energy andNatural Resources

(A) Energy

• Why Invest in Energy?
• Market Underserved by Private Equity Capital
• Projections of Global Energy Demand and Consumption
• China’s Consumption Projections
• Are Investments likely to produce Returns Independent of Oil or Natural Gas Prices?
• Inflation Hedge, Diversification and Non-Correlation Characteristics
• Recent and Historical Performance
• Investing in Oil and Gas Production/Service Companies – Evaluating Opportunities and Value

(B) Natural Resources

• Current Market Environment – Demand and Pricing for Natural Resources
• China as an Emerging Consumer
• Inflation Hedge and Diversification
• Lower Correlation to other Private Equity Investments during periods of Market Stress or Downturns  
• Making the case for Private Investment in Natural Resources vs. Public
• Generating attractive Returns regardless of Pricing Environment – Managing Volatility
• What are the Key Criteria that would lead to Manager Outperformance?

Infrastructure Investing

• Infrastructure Demand and Size of the Market – what are the Projections for the Future?
• Infrastructure Spending/Funding Gap – Explanation of the Shortfall and if this Translates into Increased Opportunities for Pension Plans
• Infrastructure as an Inflation Hedge and Portfolio Diversification
• Deal Flow and Fundraising
• Which Sectors will investors find the best Opportunities and Returns? Any Emerging Trends/Themes?
• Outlook and Challenges for Global Infrastructure Investing
• Mature vs. Emerging Markets
• Investing in Energy Infrastructure
• Risk/Return Profiling – which Infrastructure Assets are classified as High Risk and Low Risk?
• Challenges and Outlook
• Implementation Considerations – Primary Partnerships, Direct, Co-Investment, Fund of Funds or Publicly Listed, Separate Accounts
• What should you look for in an Infrastructure Manager?

Conference Concludes

Bus Leaves for U.S. Cellular Field

Join us for a Chicago White Sox Game in a Diamond Suite. Network with our group in an incredible setting with a great view of the game! Experience the luxurious surroundings including new furnishings, flat-screen TVs, sliding glass windows, deluxe theater style seating, open bar and food. Join us for networking and excitement!