Private Equity Apax Partners 2008 Annual Report

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Apax Partners Annual Report 2008

What’s in this Annual Report?
Table of contents
www.apax.com
Apax Partners Annual Report 2008 2 Performance highlights

4 Apax Funds
live portfolio summary
1 Section 1:
Overview
10 Chief Executive’s letter

from Martin Halusa
14 Investment strategy
19 Our global reach
20 China – opportunities and challenges
2 Section 2:
Governance
26 Operational structure
28 Governance and compliance
32 Our values
34 The wider community
3 Section 3:
Our sector expertise
42 Sector review
Tech & Telecom
52 Sector review
Retail & Consumer
62 Sector review
Media
70 Sector review
Healthcare
80 Sector review
Financial & Business Services
4 Section 4:
Our investors
90 Investors
98 Current portfolio
100 Apax Partners international offices
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Front cover:
Shanghai World Trade Centre, Apax
Partners’ new China headquarters

Table of contents
www.apax.com

4 Apax Funds
1 Section 1:
Overview

from Martin Halusa
2 Section 2:
Governance
32 Our values
3 Section 3:
42 Sector review
Tech & Telecom
52 Sector review
Retail & Consumer
62 Sector review
Media
70 Sector review
Healthcare
80 Sector review
4 Section 4:
Our investors
90 Investors

Front cover:
The development of Apax Partners Total funds raised
The history of Apax Partners is interwoven with the development of the private
At 31.12.2008
€26.6bn
equity asset class on both sides of the Atlantic. Throughout its 30 year history, At 31.12.2008
the firm has successfully raised and advised Funds which invested across all £25.7bn
investment stages, and through several complete economic cycles. At 31.12.2008
The firm’s focus on buyouts is rooted in a culture that has always been US$36.9bn
outward looking, pioneering and committed to growing businesses.The deep
understanding of the five sectors in which its Funds invest has been at the core
of Apax Partners’ strategy, giving it early access to investment opportunities and
an ability to add value quickly to portfolio companies.
1999:The firm raises its first pan- 2001: Apax Europe V raised 2007: Apax Europe VII raised
European fund, having integrated The largest European private The largest European private
the management companies equity fund at the time. equity fund.
of its European and Israeli offices.
1976 Sir Ronald Cohen’s
€1.8bn €4.4bn €11.2bn

Multinational Management
Group and Alan Patricof
Associates join forces.
2008 China
Shanghai
office
opens
2004 Sweden
Stockholm
office opens
1980: Excelsior Fund The US firm 1994 Israel

raises its first fund Tel Aviv office
opens 2006 India
Mumbai office
opens
US$25.53m
1989 Spain
Madrid office 2000 Italy
opens Milan office opens
1981: Apax Venture Capital Fund 2005 China
The UK firm raises its first fund Hong Kong office
opens
1990 Germany
£10.15m Munich office

opens
2002: European and US operating 2004: Succession

companies merge to become Martin Halusa elected CEO to
Apax Partners LLP succeed founder Sir Ronald Cohen
sectors
industry
built around
quity firm
Private e
1976 1980
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Find out how we got here

Apax Partners timeline under the flap
Apax Partners Annual Report 2008 1
About usApax Partners is an independent global partnership

focused solely on private equity. Funds advised by Apax
Partners typically invest in large companies with a value
between €1bn and €5bn. The Funds invest in five sectors:
Tech & Telecom, Retail & Consumer, Media, Healthcare,
Financial & Business Services.
Apax Funds provide the capital and expertise that help
excellent management teams release the full potential of
their businesses. Companies backed by Apax Funds have
a strong track record of growing by investing in research
and development, exports and sales and by growing
employment.
Our mission Ourmission is to release the untapped potential

of companies, management teams and portfolio company
employees in order to generate superior returns for
the millions of individuals whose pension funds and
investment plans commit to our Funds.
2 Apax Partners Annual Report 2008 3
2008 Performance highlights
46%
New investments in 2008 Key realisations in 2008 Total amount invested in 2008 (€) Average portfolio profit growth 2008 Award winning private equity
1.84bn
11%
Deal name Location Deal name Location
D+S europe Germany Audible US
of which is top line growth;
Emap UK Bezeq Israel Acquisitions Monthly
Winner Exit of the year
TriZetto US Intelsat US
54%
Mölnlycke
Total amount realised in 2008 (€)
Weather Italy Princeton Softech US
1.07bn Average portfolio profit growth, last ten years

of which is operational improvement.
Dow Jones/Private Equity

News Awards
16%
Winner European
fundraising of the year
Winner European
large buyout of the year
Winner European exit
of the year Intelsat
Investor breakdown by type In

Apax Partners funds returns to Investors
Public pension funds 31.77% FinancialTimes-Mergermarket

European M&A Awards 2008
Private pension funds 14.16% Winner Private Equity Firm
Funds of funds 11.14% 40% of the Year
Total portfolio staff 2008
High net worth individuals 10.28%
Insurance
Banks
9.76%
7.05% >270,000 European Venture Capital
30.1%
Endowments 6.14% 30%

Journal Awards 2008
28.1%
Sovereign funds 5.18% Winner Fundraising of theYear

Total portfolio enterprise value (€)
Gatekeepers 4.52%
68bn
23.4%
20%
Net IRR top decile benchmark 2
Net IRR top decile benchmark 2

Net IRR – Apax Europe Funds1
1
Net IRR – Apax Europe Funds
18.3%
Financial News/Private Equity

News Awards for Excellence in
Equity : Debt ratio in the Apax Funds live portfolio Private Equity
10% Winner European Private Equity
31:69
MSCI Europe
MSCI Europe
Personality of theYear –
Investor breakdown Martin Halusa
5.7%
by type
0.1%
0% 15 year 10 year Net debt/EBITDA multiple
5.1x
1 At 31 December 2008.
2 Benchmark is the top decile buyout cumulative vintage year annual IRR as of March 2009 (latest available for 2009) for AEVI and all private
equity IRR for other funds.10 year and 15 year benchmarks are the cumulative composite vintage year IRRs over each period.
Source:Thomson Financial. MSCI data as of 31 December 2008.
Apax Funds live portfolio summary
Apax Funds live portfolio value by sector Tech &Telecom Retail & Consumer Media Healthcare Financial & Business Services
at 31 December 2008
Retail & Consumer 29.73%

Tech & Telecom 27.25%
Healthcare 17.17% † *
Media 13.54%
Financial & Business Services 12.31%
Portfolio equity value
* *
* *
Sale agreed July 2008, completed March 2009
*Walker: UK compliant †BVK: Germany compliant

1
6 7
Section 1
Overview

from Martin Halusa
19 Our global reach

Strategy
Our investment strategy is clearly focused on identifying
opportunities where our in-house resources and expertise can
add value. Our sole focus is, and always has been, excellence in
private equity investing. We do not do anything else.
Within private equity, we focus on five industry sectors, which
together account for around 50% of the economy. Our Funds have
invested in the same five sectors for over 25 years and our team
is made up of industry experts who are dedicated to generating
unique investment opportunities within these sectors.
We believe this strategy was right at the top of the market and
is the right one to employ in this unusual and difficult market.
Chief Executive’s letter
Why are we reporting? Welcome to the second Apax Partners Annual On the other hand, this industry will face considerable challenges over the
Report. The aim of the Report is to provide greater transparency on Apax Partners next few years. The market for raising new capital will be more difficult because
and the portfolio companies in which its Funds invest. We recognise that, as the pension funds and other institutional investors that are the main backers of
the industry expands and matures, it has an obligation to increase the quality the asset class will themselves have less liquidity and may well cut back on the
of its transparency and disclosure. Apax Partners has been at the forefront of number of firms in which they choose to invest. Ultimately, this could lead to a
discussions about how to achieve this on an industry-wide basis and is fully considerable amount of consolidation. The availability of debt financing is expected
committed to conforming to the Walker Guidelines in the UK and the transparency to continue to be limited, which puts more emphasis on private equity firms
guidelines of the BVK in Germany, as well as the Private Equity Council guidelines being able to deliver operational value-add. This, in return, presents a personnel
on responsible investment. challenge as the skill sets needed in private equity shift from financing to
operational expertise.
How does the current economic turmoil impact Apax Partners? Given the
dramatic events in the financial services industry and the global economy during What are we doing? The number one priority for Apax Partners at the
Martin Halusa, CEO
Apax Partners
2008, I would like to start by stating clearly that we believe the private equity moment is ensuring that our Funds’ existing portfolio companies are in a robust
ownership model is robust and relevant in these turbulent and worrying times. position to weather the stormy economic climate. While our Funds’ portfolio
In the last decade, private equity has become an established and viable overall is in good shape, the severity and speed of the current downturn is
alternative to public market and family ownership, and we believe that this shift is unprecedented and is impacting certain sectors and companies more severely
here to stay. It is our view that companies will continue to alternate between than others. We are mobilising internal and external resources to help and support
public and private ownership in accordance with their funding needs and the portfolio companies that are feeling the effects of the current downturn.
ability of the public markets to value them correctly, fund their growth and deal
with significant changes in strategy, which may impact short-term performance.
The private equity model is characterised by a strong alignment of interests
between the shareholders, management and employees and by a long-term
investment horizon, which in our case stretches to an average of five years.
This governance model will always be an attractive solution for those public
11%
average growth rate 2008
However, while we cannot account for all future scenarios, we believe that
we will be able to contain the impact on our Funds’ portfolio overall. At present,
the average debt level across our Funds’ portfolio is relatively modest at 5x annual
profits, and the first significant re-financing is not due until 2012. Despite the
economic slowdown last year, the 36 major companies in our Funds’ portfolio
achieved increased profits (EBITDA) of 11% and, of these companies, 30 were
companies which have multitudes of short-term shareholders with conflicting on or above our original investment plan for 2008. The ability to grow the
16%
motivations. The quarterly reporting schedule and the distraction of a fluctuating companies in which our Funds invest and to release their full potential is more
share price, which is so often unrelated to company fundamentals, represents a important at this time than it has ever been.
>270,000
employees in portfolio companies
constant distraction for management. It is an equally applicable model for those
family owned companies which are struggling with succession issues and a
lack of clear management incentive and for whom a public listing is not a average annual growth rate over the past 10 years.
Source: Apax Partners
Over the past 18 months, in anticipation of this downturn, we have
recruited several senior industrialists to our Portfolio Support Group, which now
numbers ten professionals. This team supports the investment staff, providing a
Source: Apax Partners viable alternative. wealth of operational and finance expertise. Additionally, the senior Partner group
In our view the private equity model is well suited to help companies has an average of 13 years’ private equity experience and has been through
through this difficult period. The ability to act quickly and decisively with an eye to challenging recessions before. Around 80% of the investment team has a
the long-term health of company fundamentals, rather than short-term concerns background in industry and consultancy, rather than investment banking and
about the share price, is critical. This is a view shared by the World Economic transaction management.
Forum, whose findings in a recent report show that private equity is best suited It is this team strength and experience that will help our portfolio, as well
to make the difficult decisions to manage companies effectively in a downturn. as Apax Partners, emerge out of the current difficulties in a robust position.
So far, private equity is proving to be one of the most stable elements of The governance structure with private equity firms in general and with
the financial services industry. Apax Partners in particular has never been more crucial, for example, our Funds
In terms of results, when we look back at this crisis, we believe that remain unleveraged, we remain focused on one core business and are rewarded
the leading firms will have outperformed the top players in other asset classes. only on a long-term basis. We have a governance model that has, to a large degree,
There is now significant evidence that the best firms in the industry are able to insulated us from many of the problems that financial services companies are
sustain their performance by continuing to help management teams, and we think facing today, which have been caused by inadequate checks and balances, by a
that the current downturn will further emphasise this trend. short-termist culture of uncontrolled and excessive risk taking, by misalignments
of interest, and by expansion into new business areas where risks were improperly
understood and governance structures poorly defined.
Chief Executive’s letter

continued
In contrast to the compensation schemes that have been widely criticised Key events for Apax As part of a long-term plan to expand our presence
at banks and other financial services companies, we are only rewarded if our in Asia, last year we opened an office in Shanghai, our first in mainland China.
Funds’ investments are successful. Our reward scheme is aligned with the We were also pleased to welcome Richard Zhang to the Firm to lead our push
investors in our Funds; we do not participate in the capital gains of the Funds until into Greater China. Coinciding with Richard’s arrival, several of our senior European
the pension funds, endowments and insurance companies that are our main and US based partners have relocated to the China office. Richard’s account of
backers have been paid back in full and have received the agreed return on their the challenges and opportunities that present themselves as we continue our
capital. Our horizons are also long-term, the Funds that we advise typically have expansion follows on page 21 of this Report. It remains our long-term ambition
a life-span of ten years or more. to have equivalent sized teams in Europe, the US and Asia.
Growth in the Global Private Equity market We have a relatively simple
G model. We are a ‘pure play’ private equity firm, In terms of investments, 2008 was very much a year of two halves. In the
whose Funds make investments in large companies operating in five industry first half of the year, our funds were active investors, backing four companies:
Buyout value (US$bn) Number of buyouts sectors. We provide the backing for companies that operate in the ‘real’ economy Emap, D+S europe, TriZetto and Weather Investments. In the second half we did
across the world: companies that provide mobile phone infrastructure in Greece not make any new investments due to the extraordinary economic turbulence.
700
and Pakistan, milk and dairy products in Israel and Romania and operate hospitals In terms of divestments, the highlights were the sale of satellite operator
in India. Intelsat at the very start of the year and the agreed sale of grocery chain
700
3,000 We stuck to this strategy when there was ample opportunity to expand Somerfield to the Co-Operative Group in July. Both illustrate how we are able to
our business, and fully intend to stick to it in this more challenging environment. help companies release their full potential. The case of Somerfield is a good
600 We remain a focused investment manager rather than an ‘asset gatherer’ and we example of how a period of private equity ownership can breathe new life into a
2,500 believe that the governance structures that we have put in place to manage our public business that is lacking strategic direction. Intelsat was a very successful
business globally are amongst the best in class (see pages 28–31 for more detail). consolidation play in an industry sector where our team had a very deep prior
500
understanding.
2,000 What next? We have been expecting a downturn in the credit market and a
The skill sets, governance model and alignment of interests in private
slowdown in the economy for the last three years and have invested accordingly.
400 equity will continue to create out-performance relative to the public markets.
Clearly it has been deeper than we predicted and, at the time of writing, we
1,500 However, in the short term, the industry will have to deal with a challenging
expect it to get worse before it gets better.
300 fundraising environment and portfolio companies which are suffering in the
We clearly saw valuations become over-inflated in the years leading up
current recession. Fortunately, Apax Partners is well positioned on both counts.
to August 2007, and we invested accordingly; now we think that confidence is
1,000 The companies in which our Funds invest continue to perform well in a tough
200 dropping to the extent where we will see a period of significant over-compensation.
market. We also have a large team of industry specialists and the capital
Looking at valuations with an historic perspective, we are seeing good companies
necessary to support the few companies in our portfolio which are struggling
500 with strong fundamentals being mis-priced by the public markets.
100 as a result of the recession.
In this environment, where banks have scaled back their lending, the
2000
2002
2003
2004
2005
2006
2007
2008
1998
1999
2001
Although there will inevitably be consolidation in the industry, in the

percentage of our own equity that our Funds use to back companies will increase.
0 0 long term those firms that can create value through these difficult times will enjoy
Indeed, many investments will be equity only. We will see more situations where
Source: Dealogic a very attractive future.
our Funds invest alongside established corporate players, such as our partnership
with the Guardian Media Group in Emap and Trader Media or investments like
Weather, where our Funds took a minority stake in a larger growth company
to enable it to fully benefit from the recovery. What hasn’t changed is our
commitment to helping companies release their full potential in terms of growth,
profitability and long-term sustainability. Martin Halusa Chief Executive
In its 30 year history, Apax Partners has never been focused on distressed
situations and ‘turnarounds’ or trying to take advantage of cyclical fluctuations in
the market. From our earliest days, when our Funds invested in small high growth
businesses, we have always sought to back excellent management teams in
companies with growth potential. Our Funds continue to back the same excellent
companies and provide the industrial expertise that will enable them to prosper in
these difficult times.
Investment strategy
Overview
Apax Funds have a proven strategy of Sector focus Apax Funds invest across five global growth sectors: Tech & How do we grow businesses?
sector focused investing, looking for How we help businesses grow
Telecom, Retail & Consumer, Media, Healthcare, Financial & Business Services. Typically, Apax Partners attempts to grow
opportunities where capital, experience Funds advised by Apax Partners have invested successfully in these sectors over the businesses by acting as a catalyst for change.
and insight can release the potential
Step 1
last 25 years, giving us genuine insight into the businesses in which our Funds invest.
of businesses and lead to significant
growth.The firm has successfully
The team at Apax Partners is geared toward this strategy of sector-focused investing, Define the full potential
pursued this strategy since 1990. with 80% of investment professionals having prior relevant sector expertise.
Our sector focus, combined with an Local presence Our offices have been established for an average of 13 years each
established network of local offices
Step 2
and are primarily staffed by local nationals. Close relationships with decision makers in
and a global platform, represents the
foundation of Apax Partners’ strategy.
the countries in which we operate helps us to unearth new investment opportunities
and understand the market in which portfolio companies operate.
Develop the business plan
Global reach Apax Partners has an established global presence, with ten Step 3
offices in nine countries across three continents. Our global platform enables us to
grow businesses by spotting emerging trends early, supporting the growth of global
companies and using the world’s stock markets most effectively. As the private
Accelerate performance
equity market matures, we believe that some of the best-performing firms will be
those with genuine global reach and financial scale. Step 4
Investment focus The five sectors in which Apax Funds invest follow different Harness the talent
10
Apax Partners has ten offices in nine
countries across three continents.
business cycles, which can also vary by country. Apax Funds do not pre-allocate
capital to sectors or countries but invest according to the prospects for each sector and
economy as well as the detailed strategies developed by each Apax Partners sector
team. Investments are structured around the growth needs of the specific business.
Apax Partners believes that investments in companies which are typically
valued between €1bn and €5bn are best suited to its experience and expertise.
Step 5
Focus on company results

In our view, these larger businesses offer more established and resilient business Step 6
models, more opportunities to create value, greater attraction for excellent
5Apax Partners focuses on five industry

sectors bringing deep expertise and
experience to management.
management teams, and more diverse exit options than smaller businesses and yet
still maintain the growth characteristics that are more difficult to realise in the very
largest businesses. These are also businesses that often benefit from Apax Partners’
extensive global platform and presence in multiple markets and its ability to deploy a
large amount of experienced resources in complex international transactions.
Optimise returns on equity
As well as ensuring that the financial structure is appropriate, Apax Partners
has recently embedded non-financial principles for responsible investment into
Responsible Investment Apax Partners is focused on advising the Apax Funds its investment process (see page 32–33).
on managing the portfolio risks as well as the risks of the individual companies in In the case of virtually every investment, at least one Apax Partners
which the Funds invest. Apax Funds take a responsible attitude toward the capital executive will join the board of a portfolio company in a non-executive capacity
structures in the portfolio companies in which they invest to avoid over-leveraging a to bring broad experience to bear and to give the company access to the
business. The average debt level in Apax Funds’ live portfolio is 5.1x EBITDA. international resources that Apax Partners can provide. This can assist Apax
Funds portfolio companies with matters as diverse as acquisition opportunities,
Value creation Throughout its 30+ year history, Apax Partners has been IPO planning, key management hires, understanding competitive threats and
committed to helping businesses through all stages of their development. opportunities, international expansion and benchmarking Key Performance
Apax Funds continue to look for opportunities where they can use their insight into Indicators against best practice. Apax Partners believes that having its own
the growth drivers of the underlying business. We believe that this is a more robust executives perform this role is key to driving value creation. The Apax Partners
source of returns, over the business cycle, than a sole reliance on financial leverage representative will also monitor non-financial aspects of portfolio companies such
or multiple arbitrage. Over the last ten years, the cumulative annual growth rate of as corporate governance, corporate social responsibility and compliance with
profits across the Apax Funds portfolio was 16% per annum. the Apax Partners values.
Investment strategy Investment strategy

How do we select our investments? Global reach
Apax Partners deal selection criteria
Question 1
US UK Sweden Germany China: Shanghai
Established: 2008
Is the company in one of our five sectors of industry expertise? Established: 1969 Established: 1981 Established: 2004 Established: 1990
Question 2
Do we have any particular insight into the risks and opportunities for growth?
Question 3
Is it a market leader with significant growth potential within our targeted size range?
Question 4
10
offices
China: Hong Kong
Does the company have untapped potential to grow?
45
Established: 2005
partners worldwide
Question 5
Is it a global company or does it have the potential to be?

13
years average partner
experience in private
Question 6
equity
Is the company well managed? Can we add value to the management and Spain
Established: 1989
Italy
Established: 2000
Israel
Established: 1994
India
Established: 2006
governance of the business?
We generate a huge amount of investment Of a total of 1,531 investment ideas logged and market, as well as non-financial aspects Apax Partners’ offices have been established Apax Partners has an established global reach and financial scale. Apax Partners
ideas across our global platform. Each of in our system since the start of 2005, 11% such as environmental impact, CSR policies for an average of 13 years each and platform with ten offices in nine countries is one of a small group of private equity
these initial ideas is subject to rigorous made it to the point where they were under and governance structures. On average, are primarily staffed by local nationals. across three continents. This breadth firms to have embraced the challenge
assessment by the investment team, who serious consideration and only 3% made it we spend over eight months looking at an Close relationships with decision makers enables it to spot emerging trends early, of globalisation.
will often call on external analysis to support to the next stage. Of all of the investment opportunity before it reaches completion, in the countries in which we operate gives support the growth of companies and
their deal hypothesis. When the investment opportunities that we looked at around the and in virtually every one of these investments us an advantage in terms of finding new use the financial markets most effectively.
is sufficiently well developed, it is brought world, we completed just 30. we will have a prior relationship with the investment opportunities and understanding As the private equity market matures, we
before our internal investment committees We invest a significant amount of management before the deal even makes the market in which Apax Funds’ portfolio believe that some of the best-performing
who assess the opportunity based on the internal and external resources in those it on to the system. companies operate. firms will be those with genuine global
criteria highlighted above. investments that do reach completion.
The research involves all areas of the
company’s performance, management
Investment strategy
How we support our portfolio
Sector Expertise One of Apax Partners’ core strengths is that our necessary to help our management teams
Sector Funds only invest in companies in five industry develop and grow their firms in good times
sectors. As a result, the expertise we have built as well as bad.
Expertise up over the years gives us the understanding
Management Support A key part of the strategy to invest along sector tackle particular situations and projects or, in
100-Day lines is Apax Partners’ panel of operating partners exceptional circumstances, can take the helm
Planning – seasoned industrialists who offer a wealth of at businesses that might be facing specific
Secondments Centre of managerial experience and specialist expertise. issues for which the existing management is
The members of this panel can be used to help not adequately equipped.
excellence
100-Day Planning Actions taken by an investor during the first few experience within the business and codifying this to
months with a new portfolio company are critical accelerate the pace of change.
Portfolio in determining the success of the business. We make sure that the right people and incentive
Support Apax Partners has refined its approach to this
process. An enormous amount of time is invested
structures are in place in our Funds’ portfolio
companies. And we perfect the detailed plan that
Group in gathering information and assessing the will guide the business well into the future.
FinancingTeam In such turbulent times it is inevitable that some difficult conditions, working both in-house and
of the companies in which our Funds invest will directly with investee managers. The team can
Portfolio face significant financing challenges and in many also exploit the silver linings that come with this
Recruitment Management cases the existing management teams will not territory, working with the companies to make
have faced such tough trading conditions before. use of the ultra-low interest rate environment
Centre Support Apax Partners’ Financing Team can be made and the value-creation opportunities it offers.
available to help navigate a path through the
Portfolio Recruitment Centre With over 100 companies in the current portfolio the search and selection function for strategically
employing hundreds of senior managers, Apax important managerial and advisory positions
Partners’ Portfolio Recruitment Centre provides a within the portfolio, sourcing and liaising with
key support function. The team, which manages a specialist outsourcing firms where necessary.
FinancingTeam 30,000-strong database of contacts, undertakes
Secondments Apax Partners also seeks to provide support via high-level support, while the investment team
the seconding of investment team members members gain invaluable hands-on experience
into portfolio firms. Given the current economic in a tough operating environment.
conditions, this makes for a win-win situation:
The Portfolio Support Group harnesses As well as helping portfolio companies The Group delivers focused support in a our portfolio companies benefit from additional
the varied array of talents within the firm deal with today’s challenging market number of different ways as explained in the
to deliver the best mix of services to the conditions, the Group identifies longer-term diagram and descriptions on this page.
companies in which our funds invest. opportunities that may have been lost by
management as they deal with pressing
short-term operational issues.
China: opportunities
and challenges
Richard Zhang Apax Partners Greater China
China and beyond The opening of Apax technology and consumer goods giants are The Chinese government’s response to
Partners’ first office in mainland China was also the market leaders in the mainland, and the crisis has been swift, massive and
one of the key highlights for the Firm in 2008. recent political change in Taiwan has continuous. It is primarily aimed at boosting
It followed nearly three years of methodical accelerated the speed of this integration. domestic investment and consumption
preparation after the opening of a beachhead Investments can be completed in to counterbalance export losses. We are
in Hong Kong in 2005, and represents the Hong Kong or Taiwan, which have more already starting to see limited signs of
continuation of a deliberate and consistent investor friendly regulatory regimes, while progress. Retail sales grew about 15% in
globalisation strategy. By transferring senior still being able to tap into the mainland the first two months of 2009 compared to
professionals from across our network and growth. Regardless of where the transactions the same period a year ago, and automobile
making highly selective new hires in China, actually take place, developing truly deep sales in particular hit a record high of over
we now have seven investment professionals China-specific insights, relationships, and 1 million units in March 2009. Credit has
including three Partners based in Greater networks to spot attractive assets and make steadily become more widely available since
China. The team is headed by me, Richard them actionable is a critical factor of success November 2008; new loans quadrupled to
Zhang, a native Chinese and a former across Greater China markets. reach RMB1.89 trillion in March 2009 from
Director of McKinsey who, over 15 years of only RMB470 billion back in November.
The impact of the global slowdown While
consulting experience with the firm, played Chinese banks remain highly liquid and
the current economic events have had no
a key role in building its China practice. profitable, having suffered minor bruises
bearing whatsoever on the timing of our
Apax Funds’ initial investment focus is from the subprime loss. More importantly,
entry into mainland China, this is certainly a
mainland China, Hong Kong and Taiwan China’s longer term fundamentals remain
critical moment for China’s potential rise as
while being opportunistic in South East Asia strong, as continued urbanisation will create
an economic superpower. After 30 years
(primarily Singapore and Korea). The Funds another 200 million new consumers and
of reform, liberalisation and astonishing
will follow the same proven investment possibly over a dozen mega cities (each with
economic growth, China is undergoing one
strategy and apply the same investment a population in excess of 10 million) in the
of its most challenging periods as a result
principles and criteria as they do across our next 2–3 decades.
of the global financial crisis; proving there
global platform. We want our Funds to be
is no such thing as decoupling. Danger or opportunity Despite the enormous
seen as not just a financial sponsor, but a
The dramatic slowdown in exports has promise, China is never an easy market, and
‘strategic partner’.
almost halved China’s GDP growth from a we are fully aware of the need for patience
Greater China In terms of the market, the peak of 13% in 2007 to only 6.8% in the and prudence. However, growth was, is
Greater China economies are all profoundly final quarter of 2008. The first half of 2009 and will remain a fundamental theme of
shaped by mainland China. For instance, is likely to continue this downward trend. China, notwithstanding the current crisis.
roughly 60% of the Hong Kong stock Yet it is difficult to think of anywhere in the Incidentally the Chinese word for ‘crisis’
exchange market capitalisation comes from world today where you can sense more literally consists of two characters --
pure mainland Chinese companies and a hope and positive energy, not least in the ‘wei’ meaning danger, and ‘ji’ meaning
listing in Hong Kong has become a gateway vast upsurge of entrepreneurial activity that opportunity – the marriage of danger
to the world for Chinese champions with has been unleashed. and opportunity.
global aspirations. Many of Taiwan’s
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2
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Section 2:
Governance
32 Our values

Stability
The private equity model is characterised by an alignment of
interests between the private equity firm, the investors in its
funds and the portfolio company management. In contrast to
many other financial services models, our investment horizons
are long-term and we are only rewarded for success after our
investors have been repaid.
Apax Partners has consistently sought the highest possible
standards in corporate governance and transparency. Our rigorous
internal processes are supported by external advisory boards to
ensure that interests remain aligned and any conflicts are dealt
with quickly and efficiently.
How we are run

Operational structure
Apax Partners
Executive Committee The Executive Committee is responsible for the day-to-day Martin Halusa Worldwide CEO (London) John Megrue (New York) Michael Phillips (Munich) Stephen Grabiner (London)
Martin joined Apax Partners in 1990. John initially joined Apax Partners in 1988, Michael joined Apax Partners in 1992. Stephen joined Apax Partners in 1999.
management of Apax Partners worldwide. The group meets on a He is Chairman of the global Executive then left to co-found his own private He leads the Financial & Business He leads the Media team globally and
monthly basis to discuss matters of strategic importance for the Committee and Investment Committee equity firm and returned with his team Services team globally and is a member is a member of the Investment,
global organisation. and a member of the Approval, Exit and in 2005. He is a member of the Approval, of the Approval, Investment, Portfolio Portfolio Review and Exit Committees.
Portfolio Review Committees. Investment, and Portfolio Review Review and Exit Committees.
Committees.
Investment Committees Below the Executive Committee are a further four sub-committees
that oversee the investment process from initial idea through due
diligence and throughout the life of the investment to its eventual exit.
1
Approval Committee
2
Investment Committee
3
Portfolio Review Committee
4
Exit Committee
At every stage in the process, the investment is subject to a rigorous Chaired by Peter Englander, the Approval Chaired by Martin Halusa, the Investment Chaired by Peter Englander, the Portfolio Chaired by Paul Fitzsimons, the Exit
process of scrutiny by these committees. Committee acts as a sounding board to Committee makes the investment Review Committee periodically monitors Committee reviews exit options for
the deal teams and ensures that the recommendations to the investment individual portfolio companies to assess specific portfolio companies.
best opportunities are pursued across manager. ways in which Apax Partners can add
our sectors and geographies. further value or to iron out potential
problems.
Tech & Telecom Retail & Consumer Media Healthcare Financial & Business Services
Five specialist sectors Sector teams work across our global network of offices, using Pioneers in Technology and One of the leading global One of the largest and Strong scientific background, Worldwide, the FABS team is
extensive in-house knowledge and access to business networks. Telecommunications investing investors in the Retail and longest-established teams in the with many members having made up of 18 investment
We are able to quickly identify global trends within a sector and with companies on both sides Consumer sector over several industry. The team has a wide achieved academic success professionals located across
of the Atlantic. decades. Over €2.4bn of equity variety of industry, consulting, in their specialist field before Apax Partners’ office network.
maximise the business opportunities. invested in retail businesses. private equity and banking moving into industry, consulting The team has a broad range of
experience, with focus on niche or private equity directly. expertise spanning industry,
sub-sectors. consulting and investment
banking.
Sector expertise Management support 100 Day Planning Financing team Portfolio Recruitment Centre
Portfolio Support Group The Portfolio Support Group harnesses a varied array of talents We only invest in the five sectors Our panel of seasoned Our process of early-day Our finance team offer portfolio Our 30,000-strong database
within the firm to deliver the best mix of services to the in which we have specialist industrialists are experts at planning is critical to the companies unrivalled experience, of experienced management
experience and expertise. working with the management success of our investments. which is proving crucial during personnel offers our portfolio
companies in which our funds invest. of our portfolio companies to the current economic downturn. companies unrivalled
maximise growth potential. recruitment resources.
Support operations Compliance Funds Administration/Finance Investor Relations Communications Tax IT Human Resources
Ensures the business complies with Provides administrative operations to Manages the relationships with our Manages the dialogue between the firm Manages reporting of information to Provides and manages the technology Manages all aspects of the firm’s
governance regulations. ensure the smooth financial running of investors. and its stakeholders. investors to allow them to comply with infrastructure. relationship with its employees.
the business and timely and accurate their own tax filing obligations.
Ensures the business complies with
investor reporting.
external regulations and the Apax Partners
internal code of conduct.
How we are run

Governance and compliance
The Company’s approach to corporate governance Apax Partners LLP Sub-committees Below the Executive Committee are a further four sub-
(‘Apax Partners’) is the holding company for the worldwide Apax partnership and committees that oversee the investment process from initial idea through due
is the lead investment adviser to the most recent Apax Funds. In the UK, it is diligence and throughout the life of the investment to its eventual exit. At every
regulated by the Financial Services Authority (FSA) and advises Apax Partners stage in the process, the investment is subject to a rigorous process of scrutiny
Europe Managers Limited (APEM) which is also regulated by the FSA. APEM is by these committees.
owned by the firm’s UK-based senior partners and manages the assets of the Investment process
most recent Apax Funds.
Apax Partners is committed to maintaining the highest business standards
consistently across all of its offices. Although the firm is only subject to formal
registration and regulation in some of the markets in which it operates, it is
nonetheless governed on a global basis and applies the same business principles
1 2 3 4
Approval Committee Investment Committee Portfolio Review Committee Exit Committee
and compliance procedures to all of its operations. Chair Peter Englander Chair Martin Halusa Chair Peter Englander Chair Paul Fitzsimons
As such, Apax Partners has consistently sought to lead good practice in
Terms of reference Source of guidance Terms of reference Terms of reference Terms of reference
corporate governance and transparency within the private equity sector. to deal teams. Approval of deal expense Provide investment Review of progress of portfolio Reviews exit options for specific
The business of Apax Partners is operated and managed through a small budgets. Provision of advice to European recommendations to company compared to 100 Day portfolio companies.
number of committees whose respective terms of reference clearly define Investment Committee. the investment manager. Plan. Forum for discussion of likely
ongoing funding requirements
responsibilities and accountability. and for exit opportunities.
Recommendation of management
changes to the deal team.
Fund Advisory Boards As well as the internal corporate governance bodies,

Apax Partners has a well-established structure of external advisory boards.
2 Each of the Funds managed or advised by Apax Partners has a Board of Advisers.
3 4 Representatives of up to 15 of Apax Funds’ Investors are invited to become
1
members of the Board. The independence of the Board is maintained because
it is always chaired by one of our investors, who are appointed every two years.
The Board is currently chaired by Wim Borgdorff, managing partner at AlpInvest
Partners, Europe’s largest investor in private equity. The responsibility of the
Chairman is to set the agenda and ensure that the Board of Advisers complies
Executive Committee with its terms of reference.
1. Martin Halusa Chairman The Board of Advisers meets twice a year and is consulted by the General
2. Stephen Grabiner Partner on certain of the affairs and operations of the Funds, in particular, issues
3. Michael Phillips relating to conflicts of interest and review of the valuations at which investments
4. John Megrue are carried in the notes to the accounts.
Debt Apax Funds are managed with zero leverage. At the portfolio company
level, average leverage is 5.1x.
Compliance Compliance reports periodically to the Executive Committee
Executive Committee The Executive Committee is responsible for the on results of monitoring and other issues and on an ad hoc basis as necessary.
day-to-day management of Apax Partners worldwide. The group meets on The Partner with the responsibility for the oversight of Apax Partners’ compliance
a monthly basis to discuss matters of strategic importance for the global is Martin Halusa.
organisation. It is also responsible for setting standards on remuneration and
recruitment and oversees the governance of the firm in each of the countries
in which it operates.
How we are run

Governance and compliance
continued
Global business standards The Compliance department has developed Personal responsibilities Apax Partners prides itself on the honesty and
a series of principles and procedures to guide and support the global firm. integrity of the people it employs, and recognises its duty to make all employees
The key principles are communicated through regular training and visits aware of their responsibilities. The Compliance department provides guidance
to all offices and are regularly monitored to ensure that the standards are being to all members of the team on how they should conduct themselves and the
adhered to. The main areas of focus are as follows: consequences of their behaviour, and encourages all members of the team to
voice any concerns that they might have.
Conflicts of interest Apax Partners maintains policies concerning potential
All employees are required to sign an undertaking confirming that they will
conflicts of interest not only to comply with its FSA regulatory obligations but
adhere to the standards which are available to everyone via the Apax Partners’
in particular to identify and manage those conflicts. Typically, conflicts are
Intranet site and also brought to their attention as appropriate.
managed by obtaining consent, refraining from taking action and by disclosure.
Apax Partners recognises that an individual may act in a way which places
Detailed procedures are in place to manage conflicts, for example co-investment,
them in direct conflict with the interests of the business and it has adopted a
remuneration, carried interest, allocation and responsibility of Directors. There are
strict personal account dealing procedure and requires all members of the global
also policies designed to manage personal conflicts such as personal share and
team to obtain prior approval from Compliance before carrying out any personal
securities dealing, the receipt of gifts and entertainment, and external non-Apax
transaction. Compliance maintains a restricted list and permission to deal will not
activities. Each Fund has a Board of Advisers, made up of the major investors in
usually be granted where the transaction relates to a company on that list.
that fund to which potential conflicts can be referred for guidance. The scope
of this Board is set out in its terms of reference and in the Fund’s partnership Anti-money laundering Apax Partners considers it unlikely that parties
agreement. will seek to use their relationship with Apax Partners in connection with money
laundering or terrorist financing. Nevertheless it views its responsibilities in the
Senior management arrangements Certain positions and functions within
area of anti-money laundering seriously and has worked with the BVCA and the
Apax Partners require key individuals to receive approval from regulatory bodies
FSA to contribute to the standards currently in place within the private equity
before they can be appointed: these include all Partners and Directors, and certain
industry in the UK.
key support functions such as Compliance and Finance. As an Approved Person,
those individuals are required to conduct themselves in a manner consistent with Custody APEM is appointed by the General Partner of the Apax Funds to
a specified set of principles and are personally accountable to the Regulator for act as custodian of the assets of the Apax Funds. This is a regulated activity in the
their actions. UK. Its activities as Custodian are specifically reported on by external auditors to
the FSA. Since its appointment, APEM has only received unqualified audit reports
Confidentiality Members of the Apax Partners team recognise the trust
in respect of this activity.
that is placed in them, both by investors and by the companies that the Funds
are looking to invest in. Confidential information received by any Apax Partners Risk management The responsibility for risk management within Apax
representative is treated as such and all reasonable practical steps are taken Partners rests with the Executive Committee. The overriding culture within the
to restrict access by unauthorised persons. Everyone is required to sign an organisation is always to adopt the highest standards in all areas of the business
undertaking reminding them of their obligations on joining the firm and and demand the same from all third parties who perform activities on our behalf.
annually thereafter. Where specific risks within the business have been identified, appropriate
controls are in place to mitigate those risks from occurring wherever possible.
Our values
What is important to us?
Our values are built into every aspect of We are long-term investors with the aim of
our business. Because private equity is building robust and sustainable businesses.
such a long-term business, and depends We employ a rigorous screening process
on the trust it receives from investors, before we make any investment, which
business owners and management teams, includes an assessment of the environmental,
the values of integrity and sustainability ethical and social impact of that business.
are crucial in everything we do. We apply These aspects of the business are then
these values equally across our business in assessed on an ongoing basis as part of the
all of the countries in which we operate. portfolio review process and are analysed
They inform our interactions with by the whole team on a twice-yearly basis.
employees, portfolio companies, suppliers, Portfolio companies are encouraged to take
investors and the local communities in an active lead in terms of corporate social
which we operate. Apax Funds are long-term responsibility partly because we believe that
stewards of over US$35bn of our investors’ this will enhance the reputation and long-term
capital, which has been entrusted to us on the prospects of the business and help to reduce
basis of our values and uncompromising potential liabilities.
integrity. Apax Funds predominantly invest in We are proud of what we do: backing
growth companies within our five sectors of management to release the full potential of
expertise. The Apax Funds do not invest in their businesses through insight and patient
companies involved in firearms, pornography long-term investment. We are very aware
or that derive significant revenues from the of our responsibilities and at all times are
production or sale of tobacco. guided by our values.
Our five core values Shaping our industry’s values We are committed to working with the industry on
corporate responsibility issues including environmental, social and governance best
1. Integrity We apply the highest standards independent assessment by the Carbon 4. Building long-term relationships We advance employees on merit, irrespective of practice, as well as raising the standard of transparency and disclosure to all our
of integrity across our worldwide business Neutral Company, Apax Partners has offset its conduct business on a long-term, sustainable age, gender, nationality, disability, religious stakeholders. As such, we were engaged from the earliest stages in the development
in our dealings with all of our stakeholders. carbon emissions to become carbon neutral and transparent basis, looking to create belief or sexual orientation. We do not tolerate of the Walker Guidelines on Transparency and Disclosure in the UK, and are involved
across all its offices. We continue to work to relationships founded on mutual advantage abusive, harassing or offensive conduct in the with industry associations in other countries in their creation of similar codes.
2. Safeguarding our environment We run reduce our carbon footprint wherever possible. which are capable of enduring beyond a single workplace. The welfare of our employees and In addition, this year we signed the Private Equity Council’s Guidelines for
environmentally sound operations which transaction. those of Apax Funds’ portfolio companies is a Responsible Investment, and again were involved from the start of the project.
aspire to create minimal damage to the 3. Supporting communities We act with top priority. We aspire to have no accidents, no Working with our investors and the Private Equity Council in the US, we helped
environment. We seek to drive down the respect and consideration for the quality of life 5. Putting people first We treat people with harm to people and not to subject anyone to devise nine principles for the private equity industry, guided by the UN Global
environmental impact of operations by and economic and social progress of the dignity and respect, as we would wish to be unnecessary risks at work. Compact’s Principles and the UN Principles for Responsible Investment.
reducing waste, emissions and discharges communities within which we operate. treated ourselves. We only recruit, select and We are formally embedding these Guidelines into our investment process.
and by using energy efficiently. Following an See the PEC website for the full list at www.privateequitycouncil.org
How we are run

The wider community
The Apax Foundation is a UK-registered charity and is the channel for Apax
Social entrepreneurship: Bridges Social Entrepreneurs Fund As one of the founders
Partners’ corporate giving globally. In 2008/09,The Foundation made grants of £1.2m.
of Bridges Ventures in 2002, Apax Partners maintains a close relationship with the
Given the wide range of good causes that exist and the difficulty of choosing
organisation and is keen to be involved in its development. Bridges is a venture capital
between them, we have continued to focus our major grant-giving on the very
firm with a social mission – it invests in businesses which will generate a social return
specific area of social entrepreneurship.
as well as a financial return.
Social entrepreneurship is a natural fit with what Apax Partners does
Many social enterprises need capital to develop but find it difficult to raise
commercially and is also an area where several of our team, including some of the
investment. Bridges’ latest initiative is the Bridges Social Entrepreneurs Fund, which
Apax Foundation’sTrustees, have significant experience.This provides us with a
aims to fill this need by providing funding specifically to enable successful social
steady flow of introductions to leading charities in the field, both from within the firm
enterprises to grow.
and from our wider network.
In 2008 the Apax Foundation became one of the Founder Partners of the
The Foundation has also continued its commitment to our staff ‘matching’
Social Entrepreneurs Fund with a three-year funding commitment to the Bridges
scheme and the private equity community’s collective charity, the Private Equity
CharitableTrust, which is establishing the new fund.
Foundation.
The Apax Foundation is chaired by Sir Ronald Cohen and itsTrustees are drawn www.bridgesventures.com
from the senior ranks of the firm: Peter Englander (CEO of the Foundation), Martin
Halusa, Khawar Mann, David Marks, John Megrue, Michael Phillips and Richard
Social entrepreneurship: Emmaus is an international movement which creates
Wilson.
communities for the homeless, offering a home, work and the chance to rebuild their
Social entrepreneurship is a wide field covering all enterprises that have a lives in a supportive family environment.
social purpose rather than being purely profit-driven. The Apax Foundation The communities aim to be self-sustaining – the Emmaus model is that,
concentrates on organisations that are working to promote employment in alongside the living quarters and pastoral care, each community runs a business
disadvantaged communities. operation providing work for the residents, all of whom are required to sign off
We have extended the range of charities we support this year and added primary state benefits.The revenue from this business goes to maintain the
three significant new sponsorships to our existing portfolio: Emmaus, Ashoka and community.The ethos combines self-help with awareness of the needs of others.
the Bridges Social Entrepreneurs Fund. Emmaus has created a virtuous circle where existing, successful communities give
from their profits to help communities at the early stage of development to get up
and running.
Social entrepreneurship: Ashoka is a global organisation which identifies leading social
We were introduced to Emmaus by its President,Terry Waite, whose
entrepreneurs around the world and provides financial backing to enable them to
experience as a captive in Beirut made him particularly sensitive to the isolation of
develop their enterprises.
people living outside mainstream society.
The Apax Foundation wanted to support an Ashoka Fellow whose business
matched our specific focus on enterprises which stimulate employment in deprived “It was then I experienced what many people go through. I endured the misery,
communities and selected Norbert Kunz. the sense of isolation, fear, boredom, the despair and that sense of helplessness
Norbert’s project aims to establish self-employment as a viable option for and exclusion from ordinary, everyday life, which is so much part of both captivity
disadvantaged, unemployed young people in deprived regions of Germany. He and homelessness”. TerryWaite President, Emmaus UK
created a support system for young, small-business entrepreneurs offering advice,
In 2008 the Apax Foundation agreed a three year grant to Emmaus which will go
training, infrastructure, financing and mentoring in what he calls a ‘one-stop shop’.
towards the development of communities in the UK, US and India.
The project has so far enabled 1,000 formerly unemployed young entrepreneurs
to set up their own small businesses and created 1,300 jobs.The Apax Foundation’s www.emmaus.org.uk www.emmaus-international.org
three year funding commitment to Norbert via Ashoka will enable him to continue his
work and build on the existing success of the project.
www.ashoka.org
Emmaus
“After I heard about my family, I locked One of these was for a company
myself in my flat. I don’t know how I got providing pet medication, and they offered
through it. My doctor then told me I me full-time employment. Recently I was
couldn’t do care work anymore because of promoted to store manager, which I’m
an old back injury that had flared up again. really enjoying. The skills I picked up at
That was the final straw. I lost track of time Emmaus have helped me.
for a while. I slept on the streets in Victoria I don’t want to lose my links with
for four months. Emmaus Greenwich and I want to continue
When I arrived at Emmaus Greenwich to help them because they helped me. I go
Andy’s story Andy worked as a carer it was as if I had been looking for a place into the Community from time to time and
for children and adults. In 1996 he went like that all my life. It felt safe and I could help out in the kitchen. I make cakes and
to work in Bosnia and was deeply relax at last. My room was an expression pastries. I am taking each day as it comes,
traumatised by what he saw there. of me. I had flowers in my room. Living at but on the whole I feel optimistic about
Shortly after he returned to the UK, his Emmaus Greenwich gave me the chance the future.
wife and children were killed in a road to think about what had happened to me Emmaus gave me the breather I
accident. Until a year ago Andy lived and to work out what to do next. needed. They gave me support, even when
at Emmaus Greenwich (UK). When I felt strong enough to leave, I thought I didn’t need it. I feel so much
the Community helped me move out into stronger now. The loneliness inside me
a shared house. I delivered leaflets, worked has gone. There should be more Emmaus
as a cleaner – at one point I had three Communities. It’s a system that works”.
part-time jobs!
How we are run

The wider community
continued
The ‘matching’ scheme Many of our team give their time and skills to Opportunities for young people: Business in the Community Apax Partners
charitable causes close to their hearts. Apax Partners supports and encourages is a member of Business in the Community and we welcomed 30 students from
this spirit of giving through a ‘matching’ scheme. Under this scheme, the Apax John Kelly Boys and Girls Schools to Apax Partners’ London headquarters through
Foundation makes a grant of at least £5,000 to every charity that benefits from Business in the Community’s mentoring programme, Mosaic.The students spent
Apax Foundation matching scheme
the significant, active involvement of a member of the Apax Partners team. a day learning about the work of the different departments in the firm to open their
Mia Saunders, Personal Assistant, Apax Partners minds to career opportunities they might not have been aware of, and some students
The Private Equity Foundation (PEF) is the collective charity for the London office, supporting The Samaritans
Apax Foundation matching scheme Mia has regularly manned a helpline for The then returned for more focused work experience later in the year.
European private equity community. It focuses on the issue of NEETs (young Samaritans, covering either an evening shift after work
Irene Liebler, HR Manager, Apax Partners Munich office, people not in education, employment or training) and invests both money and from 6-10pm or the 10pm-3am night time slot. She “I spent my work experience with Iain Katimbo [Fund Accountant] – he showed me
and Khawar Mann, Partner, Apax Partners London office,
supporting Room to Read Room to Read is an
expertise from the private equity community to help charities working in this underwent training in order to qualify for this work everything he does and was really helpful. I’m still in touch with Iain and he gives me
counselling people in vulnerable emotional states, for
international organisation which builds schools in the area achieve a step-change in their impact. whom The Samaritans acts quite literally in some cases great advice”. Usman Mirza Student, John Kelly Boys’Technology College, Neasden
developing world in partnership with local communities. As well as backing the Private Equity Foundation financially, Apax Partners as a lifeline. www.samaritans.org
Irene Liebler and her husband, Hans, helped to Opportunities for young people: Social Mobility Foundation Separately,
establish Room to Read in Germany in 2006. As they had staff play an active role in the work of the charity.
we are supporters of the Social Mobility Foundation’s placement programme.
already been sponsoring the education of two girls in Nepal Isabelle Probstel from Apax Partners’ Munich office has been instrumental
for some years, they chose that country for the new school The programme aims to inspire able students from less privileged backgrounds
in establishing the Private Equity Foundation’s operations in continental Europe,
which their Room to Read division would support. As well by broadening their outlook on potential career opportunities.
as continuing to organise fundraising activities for the overseeing all of the charity’s activities in Germany. Under her leadership,
In 2008, a group of students from the Social Mobility Foundation joined our
school in Nepal and now a second school in Vietnam, Irene the PEF made its first grant in mainland Europe this year, to the Hamburger
has activated her network to inspire others to become existing work experience programme.They were based in the Media team and, in
Hauptschulmodell (HHM), an organisation working to optimise the career
involved and, as a result, a new Room to Read division is addition to their project work there, had ‘lunch and learn’ sessions to give them a
being established in Frankfurt. opportunities of young people who leave school having completed only the
Separately, Khawar Mann and some friends from view of a variety of office functions.The students were encouraged to explore and
most basic level of education.
business school got together to fund a school in Vietnam in to draw on help across the firm: the Apax team enjoyed the experience of being
the Room to Read programme.They have raised funds for In the UK, ten members of the Apax Partners London team swapped
unexpectedly waylaid by enthusiastic teenagers bursting with questions; an exercise
the construction of the school, teacher training and their suits for overalls to add the finishing touches to a new community centre
materials, and ongoing maintenance of the school, and their particularly enjoyed by the students was the challenge to find potential bolt-on
in Newham, East London.They worked alongside teams from other private
involvement also extends to providing guidance about what acquisitions for the firm’s portfolio companies.
they would like the school to achieve. www.roomtoread.org equity firms to complete the project, which was funded by the Private Equity
Foundation in partnership with Community Links. “This work experience has given me bigger ambitions and dreams for the future.
In addition, Apax Partners’ London office hosted a summer reception for I didn’t have any links into the financial industry before and this experience has
the PEF to bring together their supporters and portfolio charities. made me even more determined to work hard to achieve my goals”.
Anish Shah Student, Claremont High School, Kenton
Apax Foundation matching scheme Apax Foundation matching scheme

Stephen Grabiner, Partner, and Steven Dyson, project is under way, with four young orthopaedic Mitch Truwit, Partner, and Mike Gallagher, students to have gone through the programme has
Principal, Apax Partners London office, supporting surgeons, two Israeli and two Palestinian, working Associate, Apax Partners New York office, supporting graduated or is on course to graduate in the standard
Building Bridges Dr Mark Berelowitz, Consultant side by side at the Royal Free with the support of StreetSquash Mitch serves as a board member of four years and all have gained acceptance to college.
Psychiatrist at the Royal Free Hospital, London, had an Mr Nicholas Goddard, Consultant Orthopaedic Surgeon. StreetSquash, a charity in Harlem, New York providing Mitch’s enthusiasm for the programme was clearly
idea to foster understanding in areas of conflict by An important component of the model is that, as well support to underprivileged children. At risk children are infectious and Mike Gallagher, a colleague in the New
bringing young doctors from both sides of a troubled as working together, the doctors should also live selected by their schools to join the programme, which York office, volunteered as a mentor this year, working
region to London to train together at the Royal Free, a together for the duration of their stay in London to teaches the children squash and also, more importantly, with a 12-year old boy both on a one-to-one basis and
leading London teaching hospital. He talked about it to deepen their understanding of each other’s culture and improves their academic and social prospects through at group events with other children taking part in the
Stephen Grabiner and Steven Dyson at Apax Partners, perspective. The project is not limited to Israel/Palestine one-to-one mentoring and involvement in community programme. www.streetsquash.org
and they decided to work with him to translate the idea and it is hoped that in time it could be developed to service projects. To date, every one of the high school
into reality. A few months later the Building Bridges other regions damaged by conflict.
40 41
3
Section 3:
42 Sector review
Tech & Telecom
52 Sector review
Retail & Consumer
62 Sector review
Media
70 Sector review
Healthcare
80 Sector review
Tech & Telecom

Apax Funds are pioneers in technology and telecoms
investing. They have backed companies on both sides of the
Atlantic from the very first days of the venture capital industry
and were among the first to apply the skills forged in these
venture capital deals to the buyout arena.
Top Tech & Telecom investments

Weather Investment year Enterprise value at Bezeq Investment year Enterprise value at
Investments time of investment time of investment
2008 €21.3bn 2005 €4.3bn

NXP Investment year Enterprise value at Tim Hellas Investment year Enterprise value at
time of investment time of investment
2006 $11.0bn 2005 €1.9bn

TDC Investment year Enterprise value Intelsat/ Investment year Enterprise value at
time of investment PanAmSat time of investment
2005 €11.3bn 2005 $11.6bn


Tech & Telecom partners
1. Borja Martinez 6. Nico Hansen

Office Madrid Office New York
Board seats Panrico, Board seats TriZetto, Xerium, Kabel
Wisdom-LaNetroZed, DMR Consulting, Deutschland, Versatel.
Fractus, Electro-Stocks (observer).
Background Joined Apax Partners in
Background Joined Apax Partners in 2000 from McKinsey, where he
2000. Prior experience at BCG and specialised in telecoms. PhD in
Goldman Sachs. BSc in Business Economics from the University of Bonn,
Administration from ESADE. MBA from MA in Economics from the University of
Harvard Business School. Göttingen.
2. Roy Mackenzie 7. Jason Wright

7 Office London Office New York
1 9 10
2 Board seats Frontier Silicon, King.com, Board seats Realpage, Plex Systems,
5 Tideway Systems, NXP (observer). Planview
4
Background Joined Apax Partners in Background Joined Apax Partners in
2003. Prior experience at McKinsey & 2000. Prior experience at GE Capital and
Company, Psion Computers and Accenture. BA in Economics from Tufts
Microsoft Corporation. M.Eng in Electrical University. MBA from the Wharton School
Engineering from Imperial College, of the University of Pennsylvania.
London. MBA from Stanford Graduate
School of Business (Arjay Miller Scholar).
8. Andrew Sillitoe
Office London
3. Giancarlo Aliberti
3 Board seats Intelsat, TDC.
6 Office Milan
8 Board seats Farmafactoring, Azimut,
1998. Prior experience at LEK. MA in
Tim Hellas, Sisal.
Philosophy, Politics and Economics from
Background Joined Apax Partners in St. John’s College, Oxford. MBA from
2000. Prior experience at Monitor INSEAD.
Company and Montedison. Economics
Degree from University of Rome, Italy.
9. Neeraj Bharadwaj
MBA from Harvard Business School.
Office Mumbai
4. Salim Nathoo Board seats Apollo Hospitals, JAMDAT
Mobile, WiderThan, NXP
Office London
Board seats Weather Investments,
1999. Previously with McKinsey &
SMART Technologies, Tim Hellas,
Company, Goldman Sachs, and Morgan
Promethean Technologies, Mobifon,
Stanley. BSc in Economics from the
Inmarsat.
Wharton School of the University of
Background Joined Apax Partners in Pennsylvania. MBA from the Harvard
1999 from McKinsey & Company. MA in Business School.
Mathematics from St. John’s College,
Cambridge University. MBA from
10.Torsten Krumm
INSEAD.
Office Munich
5. Richard Wilson Board seats Suse,Tropolys, Versatel,
Q-Cells, Acol, Onespin Solutions
Office London
Board seats Weather Investments, TDC,
2002 from Intel as a Director of Intel
NXP, Inmarsat, Mobifon, Jazztel, Autonomy.
Capital Europe. Graduate diploma (MA) in
Background Joined Apax Partners in electrical communication engineering and
1995. Prior experience at Scientific computer science, and corporate MBA
Generics and Marconi Space Systems. programme from INSEAD.
BA (Hons) in Engineering from Gonville &
Caius College, Cambridge University.
MBA from INSEAD. Chartered Engineer
(MIMechE).

Tech & Telecom review
Overview Apax Funds are pioneers in Technology and Telecommunications Strategy Telecom: As discussed above, the dynamics in the telecom market
investing. They have backed companies on both sides of the Atlantic from the very differ quite considerably from country to country. As a result, our investment
first days of the venture capital industry and were among the first to apply the strategy is predicated on a detailed analysis of i) the competitive and regulatory
skills forged in these venture capital deals to the buyout arena. dynamics in any given country and ii) the identification of those operators and
Nowadays Apax Partners focuses purely on buyouts and larger growth management teams who are best placed to benefit from the secular shifts
investments, but still offers a unique sector-focused capability, with the growth towards data, mobility and applications such as video or have exceptional
DNA and industry expertise remaining a core feature of one of the largest sector marketing and segmentation skills.
teams in the business. This capability has led to a number of buyout investments
Strategy Technology: In technology, we are focused on those companies
having been made ‘ahead of the curve’, or in non-obvious areas.
whose fundamentals ensure that they will emerge from the current difficult times
The 25-strong team comes from a variety of backgrounds in industry,
in a position of strength. These companies typically possess strong franchise value
consultancy and banking and each person specialises in different niche sub-
– derived, for example, from distribution, intellectual property and brand – as well
sectors.
as being active in sub-sectors in which the secular growth trends offset
This pool of industry knowledge can be rapidly deployed across Apax
macroeconomic downforces – for example the increasing recognition of the
Partners’ global platform according to the needs of the specific investment.
benefits of technology in the classroom.
The team has advised Apax Funds on more than €3.8bn of investment in the
last 15 years.
Outlook The telecom space is characterised by a relatively high degree of
short-term predictability, but with important medium-term effects that are largely
Marketplace/trends and drivers Telecom: We segment the telecom
independent of the current macroeconomic difficulties, yet will have a lasting
sector into incumbents, altnets, cable and mobile. This segmentation reflects
effect on the various market participants.
the differing challenges and opportunities faced by each type of operator as
In technology, the short-term predictability is significantly less. It is
the trend towards convergence marches forward. Though not immune to
nevertheless highly likely that the process of consolidation that is underway will
recessionary conditions, the changes that are happening as a result of
ensure that the leaders emerge from the downturn with a strengthened position.
convergence mean that competitive market structures and regulatory regimes
are the most important determinants of the medium-term health of any national
or regional telecom market.
Marketplace/trends and drivers Technology: We segment the technology

sector into components, systems, software and services, each with their own
Andrew Sillitoe
dynamics. In contrast to the telecom sector, the macroeconomic environment is
likely to dominate the effect of any structural changes occurring in the technology
sector over the coming quarters. That said, difficult macroeconomic times will
accelerate some of these changes (for example, the delivery of software as a
service and industry consolidation) and it is the companies that are best placed to
benefit from these changes that will emerge stronger from the current downturn.
”We carried out a highly detailed due diligence exercise – taking Intelsat’s global
capacity and building up a supply and demand model, region by region, band by
band and application by application. Our analysis showed that supply and demand
were coming into balance and we saw real scope to reverse revenue declines and
to improve operational efficiency.” Andrew Sillitoe Apax Partners’ head of Tech & Telecom

Tech & Telecom continued
Case study: Tech & Telecom Making communications closer, by far Intelsat is the world’s leading provider
of fixed satellite services (FSS). Based in Bermuda, the firm became the first to
Intelsat launch a commercial communications satellite in 1965 and, four years later,
transmitted images around the world of man’s first steps on the moon. Over 40
years on, it runs a global network of satellites and terrestrial infrastructure which
serves over 200 countries and territories and is setting the standard for the
advanced transmission of video, data and voice services.
Why this deal? Intelsat initially came onto Apax Partners’ radar screen at the
end of 2003, after Apax Funds had completed the first leveraged acquisition of
a satellite business (Inmarsat). Back then, according to Apax Partners’ Andrew
Sillitoe, head of the Tech & Telecom sector, Intelsat faced some challenges: “Intelsat
had been hit particularly hard by overcapacity in the FSS market following the tech
boom – and its revenues had been declining as a result.” But despite this, the
business still posted strong and predictable cash flows and Apax Partners was able
to see the potential for growth thanks, in part, to the expertise and relationships it
had built during the Inmarsat process.
In January 2005, Apax Funds acquired Intelsat for $5.2bn together with a
consortium of investors including Apollo, Madison Dearborn and Permira.
What has happened since the deal completed? This transaction represented a
turning point for the company and under the stewardship of a new CEO – Dave
McGlade, who joined the business in March 2005 from UK mobile operator O2 – its
fortunes began to improve rapidly. Most significantly, Intelsat agreed in August 2005
to acquire rival operator PanAmSat in a $6.4bn transaction. The deal, which brought
Intelsat added video market expertise, an advanced satellite fleet and a blue-chip
media customer base, created the industry’s largest satellite operator with the
broadest customer base. It also resulted in a new COO for the combined business
in the form of PanAmSat’s Jim Frownfelter.
Commenting on the PanAmSat transaction McGlade says: “The plan was
to use the acquisition of PanAmSat as a vehicle to accelerate change and improve
performance. Literally, the day after we announced the deal we began a rigorous
integration process aimed at creating a more balanced business. One of the key
early priorities was to make use of the significant synergies that existed in terms
of both operating and capital expenditures.”
What about the future? The next task for Intelsat’s management team, aided
by a Principal from Apax Partners who had been seconded to the company on a
full-time basis, was to develop a clear growth strategy. This strategy was to be based
on three core principles: firstly to maximise revenues on a satellite by satellite basis;
secondly to identify and make selective investments in key growth areas; and finally
to generate a strong pipeline of incremental business development opportunities.
The initiatives undertaken by the management team with the support of its
backers showed clear and early signs of success, with strong growth in revenues
and profits and a real improvement in its competitive position. In light of this, the
decision was taken by the backers to launch a sale process and in June 2007 the
investors signed an agreement to sell Intelsat to BC Partners.
“We have very strong management which will not let the market dictate to us.
We are currently concentrated on EBITDA and free cash flow across the group and
on reducing debt. On the more offensive side, I think there will be lots of potential
acquisition targets out there in the next couple of years”.
Naguib Sawris, CEO, Weather Investments

Tech & Telecom continued
Case study: Tech & Telecom A strategic partnership for global growth Weather Investments is a global
telecommunications company offering mobile, fixed-line, internet and international
Weather communication services to over 100 million subscribers in Southern Europe,
North Africa and Asia. The company operates through its subsidiaries Wind
Investments Telecomunicazioni, Wind Hellas and Orascom Telecom Holding.

Wind Telecomunicazioni is the third largest mobile and second largest fixed
operator in Italy.
Wind Hellas (formerly TIM Hellas) is the number three mobile and fixed operator in
Greece and a former Apax Europe VI portfolio company.
OrascomTelecom Holding is a Cairo listed holding company of leading mobile
operators in North Africa and Asia.
Why this deal? Apax Partners had long been attracted to the company
because of the balance between the high growth characteristics of the emerging
market portfolio and the cash flow stability of the more mature, Western European
businesses. In June 2008, Funds advised by Apax Partners together with two
other firms, won a limited auction to buy a minority stake in Weather for €1.1bn,
and a further investment later in the year increased the consortium’s stake.
Why Apax Partners? Apax Partners’ strong prior relationship with founder
and CEO Naguib Sawiris was instrumental in ensuring that it secured the
opportunity to invest, as Sawiris explains: “The reasons why we went with Apax
were trust, chemistry and integrity. I initially came across them when I was trying
to buy Wind Telecom in 2005 and, although the opportunity to work together on
that did not materialise, we kept in touch and at the end of 2007 we were in
contact again when Weather Investments acquired TIM Hellas from Apax. We did
that deal from start to finish in three weeks and subsequently became very close
to them through that deal”.
What about the future? Sawiris, who founded the company from scratch to
become the world’s 11th largest telecom provider in terms of customer numbers,
has clear ambitions for Weather. “Today, we are 11th largest, but my ambition is to
be among the five or six biggest telecom providers globally. I believe that having a
critical mass of subscriber numbers is crucial because in the future more products
and services will be run through the phone. Banking for us is a big potential
revenue stream and we already have 100 million potential customers. In terms of
payment, we own these relationships whereas a VISA or Mastercard do not”.
The growth achieved by Orascom and Wind in recent years is due in large
part to the skills of the company’s management team in acquiring and integrating
assets well and driving value. The current economic downturn provides both
threats and opportunities for the group. Apax Partners has supported Weather on
a number of initiatives on the strategic, operational and financial side to optimise
the capital structure. Commenting on the relationship to date, Sawiris concludes:
“The relationship is strong, but they are tough and know the space well. They put
our people under pressure and have ensured that the reporting discipline is in
place across the group”.
Retail &
Consumer
We have been one of the leading global investors in the
Retail and Consumer sector over several decades. During this
time we have invested €2.4bn in retail businesses, backing a
diverse range of retail, consumer and leisure businesses across
our global platform.
Top Retail & Consumer investments

Tnuva Investment year Enterprise value at Somerfield Investment year Enterprise value at
2008 $1.4bn 2005 £1.8bn

D+S europe Investment year Enterprise value at Panrico Investment year Enterprise value at
time of investment Donuts time of investment
2008 €0.6bn 2005 €0.9bn

Sisal Investment year Enterprise value New Look Investment year Enterprise value at
2006 €1.2bn 2004 £0.8bn

Tommy Hilfiger Investment year Enterprise value
time of investment
2006 €1.2bn

Retail & Consumer partners
1. Zehavit Cohen 6. Amedeo Carassai

Office Tel Aviv Office Milan
Board seats Tnuva, Bezeq. Board seats Weather Investments,
Farmafactoring, Sisal.
2006. Prior experience as Executive VP Background Joined Apax Partners in
and CFO of the IDB Group (Israel’s largest 2003. Prior experience at McKinsey,
2 investment company) and VP of Chase Procter & Gamble, Syntek Capital. Laurea
Manhattan. MA from the Wharton School, in Ingegneria Elettronica (Electrical
1 9 University of Pennsylvania; MBA from the Engineering, Operations Research) from
University of Pittsburgh. Lecturer in Universita’ La Sapienza, Rome, Italy. MBA
3
5 Finance and Accounting at the Wharton from Sloan School of Management, MIT,
7 School, University of Pennsylvania. Fellow Boston.
of the University of Pennsylvania.
7. Alex Fortescue
2. Oriol Pinya
Office London
Office Madrid
Board seats Plantasjen, Somerfield,
Board seats Panrico, Electro-Stocks, New Look.
Vueling, Itevelesa.
Background Joined Apax Partners in 1999 from OC&C Strategy Consultants.
1999. Prior experience at BCG and Merrill BEng in Electrical and Electronic
Lynch. BBA from ESADE. Master CEMS Engineering from Imperial College,
from HEC. MBA from Harvard Business London. MBA from INSEAD.
8 School.
8. Matthew Brockman
4 6 3. Alex Pellegrini
Office London
Office New York
Board seats Hit Entertainment,
Board seats Advanced Homecare, New Look, Healthcare at Home,
MagnaCare Holdings, Spectrum Laboratory Merlin Entertainments.
Network, Voyager HospiceCare, Rue21.
Background Joined Apax Partners in 2000. Prior experience at LEK Consulting.
2000. Prior experience at Merrill Lynch. BEng in Mechanical Engineering from
BA in Finance with Honors from the Imperial College, London. MBA from
Pennsylvania State University. Harvard Business School.
4. John F. Megrue, Jr. 9. David Kim

Office New York Office New York
Board seats Bob’s Discount Furniture, Board seats Tommy Bahama, Spyder
Tommy Hilfiger Corp., MagnaCare, Rue21. Active Sports, Contech Construction
Products, Norcraft Cabinets.
Background Originally joined Apax
Partners in 1988, then left to co-found his Background Joined Apax Partners in
own private equity firm and returned with 2000. Prior experience at Butler Capital
his team in 2005. BS in Mechanical Corporation. BS in East Asian Studies
Engineering from Cornell University. MBA from West Point. MBA from Harvard
from the Wharton School of the University Business School. Graduate of the U.S.
of Pennsylvania. Army Airborne and Ranger schools.
5. Christian Näther
Office Munich
Board seats Tank & Rast, Phillips van
Heusen/Calvin Klein, LR Health & Beauty
Systems, Tommy Hilfiger, CBR, D+S
europe AG.
2001 after 8 years as a Partner in
Consumer & Retail at McKinsey. Degree
in business administration and PhD in
Strategic Management from the Ludwig
Maximilian University in Munich.

Retail & Consumer review
Overview Apax Funds have been one of the leading global investors in the Interruption of some long-term consumer trends Whilst the downturn is
Retail and Consumer sector over several decades, during which time they have mostly accelerating certain long-term channel or consumer trends, there is also
invested €2.4bn of equity in retail businesses. Apax Funds have backed a diverse evidence that it is temporarily disrupting others. In recent years, there has been
range of retail, consumer and leisure businesses across their global platform: significant growth in higher priced products offering maximum convenience or
companies such as Somerfield and New Look in the UK; Plantasjen in strong health and sustainability credentials. The downturn is forcing consumers
Scandinavia; CBR in Germany; Sisal and Panrico in Southern Europe and Tommy to go ‘back to basics’, trading chilled ready meals for home cooked recipes,
Bahama, Spyder and Life Time Fitness in the USA as well as global brands such as expensive trips abroad for ‘staycations’, lattes from coffee shops for instant coffee,
Tommy Hilfiger and PVH/Calvin Klein. and organic smoothies for cheap soft drinks.
The Retail & Consumer team is made up of 23 investment professionals
Acceleration of channel shifts with value at the forefront of many
globally, including nine partners, spread throughout North America, Europe and
consumers’ minds, the relative pricing transparency and convenience of home
Asia. The team has a range of professional backgrounds and wide experience
shopping provided by the internet is transferring share online at an increasing rate.
across many segments within retail, consumer and leisure.
Increasing reach and scale of multiple grocers: in every major Western
Marketplace trends and drivers During the course of 2008 the global country there is a very large and typically concentrated grocery sector which has
macroeconomic environment deteriorated sharply, pushing many developed considerable influence on a number of food and non-food consumer and retail
economies into recession. Retail and consumer facing businesses have been categories. Whilst genuine category killers are able to compete effectively with the
amongst the first and worst affected by this. An all time low in consumer grocers, variety retailers are increasingly struggling to keep up.
confidence, increasing (fear of) unemployment, significantly reduced credit Although sector valuations dropped dramatically throughout the year, the
availability and tumbling asset prices, especially housing, have contributed to falls swift deterioration in trading and lack of visibility in outlook meant Apax Funds took
in consumption. Emerging markets, which many had thought would prove more a very cautious view on investing, with completed investments limited to contexts
resilient, are now also showing major signs of weakness. where clear secular trends underpinned growth. A good example of this approach
An unprecedented level of policy response, with low interest rates, is the acquisition of D+S europe, an e-tail fulfilment business.
spending programmes and quantitative easing take us into uncharted waters in The opportunity was also taken to realise the investment in food retailer
terms of how consumption and GDP will respond. The hope is clearly that these Somerfield, which operates in one of the most defensive categories in the
policies begin to boost demand during 2009, the danger is that they lead to consumer space, via a trade sale.
inflation, inefficiency and ultimately stagnation.
Retail & Consumer strategy Apax Funds’ investment strategy in the sector
However, the current economic slowdown is not hitting all areas of retail
is to focus on growth driven by exposure to underlying positive trends (some of
and consumer equally and evidence from previous recessions suggests that
which are outlined above). Apax Partners’ local market presence, combined with
whilst certain sub-sectors are hit hard others are relatively insulated. Even within
a global reach, enables it to understand the themes from around the world and
individual cyclical sub-sectors, there remain winners and losers and particularly in a
adapt them to local market circumstances. It also allows Apax Partners to build
tough environment, performance levels polarise.
relationships with, and Apax Funds to invest behind, the very best international
Consumer companies need to remain responsive to over-riding market
retail, consumer and leisure sector management.
trends whilst also reacting to changes caused by the current environment. These
trends include: Outlook The Apax Partners sector strategy will remain focused on global
sub-sectors which will exhibit growth, backing strong management teams
Polarisation Individuals are increasingly discerning in their choices as they
executing within the context of the secular trends identified above. The uncertain
weigh up every purchasing decision. Value for money is now the key purchase
consumer environment and lack of bank debt will inevitably be reflected in the
criterion and in their increasing search for this, consumers are showing willingness
nature of deals undertaken. Liquidity issues, over-levered balance sheets and
to alter their purchasing habits – trading down to value offers to make savings
under-valued cyclical businesses are likely to generate continued investment
on some items, whilst also investing in premium quality for others.
opportunities.
Winning propositions are those that offer distinctive value to consumers either
through price, product or service and are able to deliver and communicate this
consistently.
Alex Fortescue
“Since the acquisition by Apax Funds, we have introduced a culture of value

creation and efficiency to the company which, as a cooperative, had not
previously been part of its thinking”. Zehavit Cohen Apax Partners

Retail & Consumer continued
Case study: Retail & Consumer Adding value to Israel’s food industry Tnuva is the largest food manufacturer
and distributor in Israel and one of its most well-known companies. It owns seven
Tnuva out of the ten most known food brands in Israel and accounts for over 14% of
shelf space in supermarkets.
Tnuva was formed over 80 years ago as an agricultural cooperative of 620
farming communities across the country, who were also the company’s suppliers
of raw milk and produce. Over the years it had been seen by many investors as an
attractive proposition but due to the complex ownership structure it was out of
reach to potential buyers.
The deal Aware of a potential economic downturn, Apax Partners was
attracted to Tnuva because of its stable business model: the majority of the
company’s food products are basic staples (65% dairy-related plus meat, poultry,
eggs, fish, frozen vegetables) and so the company was felt to be well placed to
weather a recession.
Why Apax Partners? In 2006, Tnuva opened itself up to a limited auction.
Although the Apax Fund’s bid was not the highest in financial terms, it was
nonetheless perceived as the most attractive. The management and board of the
company explained their decision to accept the third highest bid by saying that the
expertise and professionalism displayed by the Apax Partners team during the
four month due diligence process prior to the Fund’s bid had convinced them that
Apax Partners would be the best partner for the future growth of the company.
Apax Partners’ ability through its local presence to understand the different
stakeholders’ needs and address them appropriately was also critical to the
success of the Fund’s bid.
Post completion Following the auction there was a lengthy and complex
process of negotiation with the agricultural owners of the business, which took
almost two years, and necessitated a change in the law and the introduction of
new tax codes. The transaction closed in January 2008, with the Apax Europe VII
Fund and its co-investor Mivtach Shamir gaining a 77% stake in Tnuva for an
enterprise value of $1.4bn.
What about the future? Apax Partners believes that the first year after an
acquisition is critical to the success of a business and the deal team put a great
deal of time into learning more about Tnuva’s business and working out where
Apax Funds could add value.
By the end of the first year following acquisition, many of the planned
changes at Tnuva had been completed. These included sales of some of unused
real estate; turning around the fresh meat business, which became profitable in
the second half of 2008; hiring new talent and creating a new organisational
structure which is expected to enhance synergies across the group.
Led by Zehavit Cohen, who became Chair of Tnuva, the Apax Fund deal
team is continuing to work through the numerous projects which were identified
as areas where our Funds can add value, as well as exploring strategic alternatives
for non-core subsidiaries and potential add-on opportunities.
“The partnership has already borne fruit. In collaboration with Apax, we are
benefiting from its financial strength and its broad international network.
This network is serving to pave the way for partnerships and business
relations. In addition, D+S is gaining access to potential customers at the
highest level”. Achim Plate CEO, D+S europe

Retail & Consumer continued
Case study: Retail & Consumer Fashioning a successful investment in a growth sub-sector D+S europe AG
is a leading international e-commerce and customer service provider listed on the
D+S europe Deutsche Börse. The company’s e-commerce division provides the tools that
enable some of the world’s biggest fashion names to maintain their competitive
edge in the online sphere. The business looks after all of the elements involved in
ensuring that customers get the best online treatment, including the design and
operation of online shops, warehousing, delivery of goods, and payment
processing. The customer service division provides essential call centre support
to some of Germany’s largest companies and is now the country’s third-largest
provider of value-added telephony services.
As an early mover in the supply of e-commerce solutions to the fashion
industry, D+S europe has seen very rapid growth in this part of the business,
and now dominates the European market in this very high-growth field. In 2007,
fashion was the fastest-growing segment of the online retail market and D+S’s
management expects the segment’s growth to continue at a double-digit pace,
despite the general economic climate. This sector trend opened up enormous
opportunities for D+S europe; so in late 2007, the company began looking for a
partner who could offer the know-how and requisite financial strength to take
advantage of this potential.
Why Apax? Apax Funds stood out because of their experience in the
fashion industry through investments such as Tommy Hilfiger, CBR Group and
Calvin Klein, as well as their experience in the IT and business services sectors
and focus on growth buyouts.
As a result, D+S’s management team engaged with Apax Funds on an
exclusive basis and in April 2008, the current Apax Europe VII fund acquired
the shares of several legacy shareholders and at the same time submitted a
voluntary acquisition tender to all other shareholders. The offer was unanimously
recommended by the D+S Board and in early 2009 Apax Funds became the
majority shareholder in D+S europe, holding over 90% of the company’s shares.
What about the future? Since the investment,CEO Achim Plate and his
team have driven D+S europe’s growth in both lines of business: In 2008 total
revenues rose by 29 per cent to €299 million. In addition to growing the existing
e-commerce customers, the business has launched online sites for new
customers including Hugo Boss and C&A. Around 40 new websites for fashion
players are scheduled to launch in 2009, including the online shop for another
Apax Funds portfolio company, Tommy Hilfiger.
In the field of call centre services, the company entered into a strategic
partnership with Deutsche Telekom in 2008, under which Germany’s largest
telecommunications company is transferring considerable customer service and
back office operations to D+S. The call centres also serve as the foundation for
corporate social responsibility activities at D+S. For years, the company has been
one of the major sponsors of the Students Helping Life (SHL) non-profit initiative,
which conducts its Social Day annually in Germany. On this day, students work
for companies or private individuals for a good cause – in 2008, some 200,000
students from over 1,000 schools participated in this campaign, which was
organised with the aid of a D+S call centre.
Media
The 20-strong Media team is one of the largest and longest-
established in the industry. The team has a wide variety of
industry, consulting, private equity and banking experience, with
members focusing on niche sub-sectors of the market. In the last
ten years, the team has advised Apax Funds on the investment of
€3.4bn of equity.
Top Media investments

Emap Investment year Enterprise value at Trader Media Investment year Enterprise value at
time of investment Group time of investment
2008 £1.2bn 2007 £1.4bn

Cengage Investment year Enterprise value at CME Investment year Enterprise value at
Learning time of investment time of investment
2007 $7.3bn 2006 $2.8bn


Media partners
1. Jacqueline Reses 4.Tom Hall

Office New York Office London
Board seats Cengage Learning, Board seats Trader Media Group, Truvo,
6 Nelson Education, Hit Entertainment, The Stationery Office, Zeneus Pharma,
The Learning Annex, NEP Broadcasting. 20 Minutes, Thomson Directories.
2
3 2001. Previously at Goldman Sachs. BSE 1998. Previously at S.G.Warburg and
5 from the Wharton School, University of Deutsche Bank. MA from Cambridge
Pennsylvania. University.
4
2. Stephen Grabiner 5. Irina Hemmers
Office London Office London
1
Board seats Emap, Travelex, Incisive Board seats Emap, Trader Media Group,
Media, Bezeq, PCM, Yell. Incisive Media, World Directories, PCM,
Sulo/Cleanaway.
1999. Previously at On Digital and The Background Joined Apax Partners in
Daily Telegraph. BA in Economics from 2001. Previously at McKinsey. MA in
University of Sheffield. MBA from International Economics from University
Manchester Business School. of Innsbruck/Tulane University. MPA in
Public Administration from Harvard.
3. Christian Stahl
6. Paul Fitzsimons
Office New York
Office London
Board seats Cengage Learning, Central
European Media Enterprises (CME), Board seats Cengage Learning,
Tommy Hilfiger, World Directories, 20 Hit Entertainment, Hub International,
Minutes, Telcast Media Group, Thomson Kabel Deutschland Group, Future
Directories, The Stationery Office. Publishing, Stage Three Music.
1999. Previously at Bain & Company. 1992. Previously at Arthur Andersen.
Diplom Kaufmann and BA in Business Chartered Accountant (ACA).
Administration from Europaeisches
Studienprogramm fuer
Betriebswirtschaftslehre (ESB),
Reutlingen/London. MBA from INSEAD.

Media review
Overview The 20-strong Media team is one of the largest and longest- Media strategy On a positive note, the fast-paced technological change
established in the industry. The team has a wide variety of industry, consulting, affecting the industry has led to a sustained increase in media consumption.
private equity and banking experience, with members focusing on niche sub- While the current economic downturn means that it is difficult to translate a
sectors of the market. In the last ten years, the team has advised Apax Funds on growth in consumption into a growth in revenues, this trend provides commercial
the investment of €3.4bn of equity. In the last five of those years, Apax Funds opportunities and a favourable long-term outlook for those companies that are able
have led eight investments in the sector, of which four have been in non- to understand and exploit sub-sector dynamics. Working in conjunction with Apax
competitive situations. Partners’ Tech & Telecom team, the Media team is well positioned to react and
continue to advise on investments that are ‘ahead of the curve’.
Marketplace/trends and drivers The two main forces driving change in the Our funds are looking to invest in situations where businesses are seeking
media sector are the economic climate and rapid technological change. to build out an online platform or in situations where brand strength and market
The severity of the current recession has hit nearly all parts of the media leadership can enable companies to operate across various media platforms
sector as businesses across the economy slash marketing budgets. Advertising successfully.
revenues are being most severely affected. In traditional media channels we are
seeing year-on-year declines of up to 30%. In online businesses, where search Outlook The impact of the current economic climate and technological
advertising has until now been a significant growth driver, advertising spend has change is having a variable impact across the sector. This will continue to be
fallen from high double digit to single digit growth. There are certain business the case, and the prospects for the various sub-sectors will consequently differ
models however, such as those based on subscriptions or with more stable end widely according to how they are affected. In segments such as consumer book
users such as the public sector, which are proving more resilient to the downturn. publishing and outdoor advertising, the impact of technological change is relatively
In parallel, the internet has led to a revolution in the way media content is low; in others, like business-to-business publishing, recorded music and
distributed. This technology shift has led to falling costs of distribution and storage newspapers it will continue to have a massive impact. Finally, for some, such as
and consequently to lower costs of entry; in other instances the impact of digital professional or academic publishers and information service providers, changes
content has changed the game for incumbent suppliers. The pace of technological in media consumption and technological innovation represent a significant
change is having a profound impact across the media space and has been opportunity for growth. Understanding the uptake of new technology across
accelerating in the current economic climate, as customers focus on cheaper different geographies and how this will impact the various sub-sectors within the
channels with the clearest return on investment. media space will continue to be the key to successful investing.
Widespread penetration of digital media across multiple channels including
cable television, broadband internet and mobile internet has led to changes in
consumer behaviour with regard to media consumption. In the UK, for instance,
the number of households connected to broadband internet shot up to 58% in
2008 from just 1% in 2001. This has corresponded with a rapid increase in usage.
In the three years to 2006, internet usage across Europe rose by 28% against a
backdrop of falling circulations in more traditional media formats like newspapers Stephen Grabiner
and magazines.
Digitisation has led to its own changes in the radio, TV and music
landscapes. Across Europe, the old incumbent TV and radio channels are seeing
their viewing figures fall as new digital competitors take market share. In the
music space, the major record labels are struggling to find business models that
fit the new world of digital publishing.

Media continued
Case study: Media Backing best of breed in a challenging environment Emap is one of the UK’s
leading business information providers serving the retail/fashion, public services,
Emap construction, media and automotive industries. The Company provides information
to its customers through four key formats: print and online magazines (35% of
2007 revenues); exhibitions and festivals (32%); digital information services (27%);
and conferences (6%).
As well as publishing, the business also organises three of the top four UK
trade exhibitions, has the leading publication in most of its core market segments,
runs the pre-eminent international advertising festival (Cannes Lions) and, with
WGSN (a provider of digital information to the fashion industry), has a high-growth
and market-leading information services business. Approximately 75% of revenue
is generated in the UK and 25% from international sources including the high-
growth Middle Eastern market.
The company’s business model has evolved from being largely reliant on
print advertising to being far more diverse and resilient and thus able to tap
different corporate budgets other than advertising.
Close to 75% of Emap's brands are number one or number two in their
market. Because of this leadership, the brands are highly valued by customers and
enjoy high renewal rates. They also benefit from a flight to quality in a more
challenging trading environment when customers will cut budgets on second tier
brands rather than reducing spend on the market leader.
The Investment Apax Funds, alongside corporate partner Guardian Media
Group, acquired the business as a result of the three-way break-up of Emap plc at
the end of 2007. The break-up led to the sale of the consumer publishing and radio
divisions to Bauer Media, a large German media conglomerate, while Apax Funds
and GMG took private the remaining B2B division and umbrella “plc” organisation.
The strong existing partnership between Apax Funds and GMG through their
joint ownership of Trader Media Group in the UK proved to be a decisive competitive
advantage in securing the coveted B2B titles. Apax Partners also had a strong
‘angle’ because of its existing investment in the B2B sector with Incisive Media.
Progress In the nine months to December 2008, Emap's revenue grew 3%
year on year. This growth was achieved against the back-drop of a difficult trading
environment in Emap's core UK market where the key end markets it serves, retail
and construction, experienced a significant downturn. This was partly compensated
for by a strong performance in its public sector end market. In comparison to
other media companies, Emap has shown a good degree of resilience, largely as
a result of having a streamlined portfolio of market leading products that benefit
from customers concentrating budget spend on the market leader.
Since the initial investment, which completed at the beginning of the year,
Apax Funds and GMG have worked with the company to complete the senior
management team, including hiring David Gilbertson as buy-in CEO from Informa.
The Group has also been fundamentally restructured along product lines, with new
reporting lines put in place and a new set of performance indicators introduced.
Healthcare
The Healthcare team at Apax Partners comprises 17

dedicated investment professionals based in Europe,
the US and India. The team is characterised by its very strong
scientific background, with many of the members having
achieved academic success in their specialist field before
moving into industry, consulting or private equity directly.
Top Health investments

TriZetto Investment year Enterprise value at Capio Investment year Enterprise value at
2008 $1.5bn 2006 €2.9bn

General Investment year Enterprise value at Mölnlycke Investment year Enterprise value at
Healthcare time of investment Health Care time of investment
Group
2006 £2.5bn 2005 €1.3bn


Healthcare partners
1. Bill Sullivan 4. Khawar Mann

Board seats TriZetto, Spectrum Board seats General Healthcare Group,
Laboratory Network, MagnaCare Capio, Unilabs, Celldex.
Holdings.
1 Background Joined Apax Partners in 2003. Prior experience at Weston Medical
2007. Prior experience at MagnaCare Group PLC and Linklaters. MA in Medical
Holdings, Inc., Oxford Health Plans and Sciences and Law and LL.M from Girton
Lincoln HN Life. Bachelors of Finance College, Cambridge University. MBA from
and Banking from Suffolk University the Wharton School, University of
4 in Boston. Pennsylvania.
3
2. Buddy Gumina 5. Cathrin Petty
Office New York Office New York
Board seats TriZetto, Qualitest Board seats Qualitest Pharmaceuticals,
Pharmaceuticals, Spectrum Laboratory Affymax Inc., Intercell AG, Zymogenetics
Network, Encompass Home Health, Inc, Xanodyne Inc., Zeneus Pharma Ltd.
Voyager HospiceCare, Magnacare
Holdings.
2000 from Schroder Ventures, and
Background Joined Apax Partners in previously worked at Schroders
1998. Prior experience at Donaldson, Investment Management. MSc in Natural
Lufkin & Jenrette Merchant Banking Sciences (immunology) from New Hall,
Partners. BA in Political Science from Yale Cambridge University with a post
University. MBA from Harvard Graduate graduate in Management Studies from
School of Business Administration. the Judge Institute, Cambridge.
3. Ian Jones
Office London
Board seats General Healthcare Group,
Mölnlycke Health Care Group, Regent
Medical, Medlock Medical, Hansen
Transmissions, PureWafer.
5 1997 from Coopers & Lybrand. Degree in
Mathematics and Computer Science from
5
Cambridge University. MBA from Warwick
Business School. Chartered Accountant
(ACA).
2

Healthcare review
Overview The Healthcare team at Apax Partners comprises 17 dedicated Healthcare IT is becoming increasingly important for providers,
investment professionals based in London, New York, Madrid, Milan, Munich and professionals and patients. New models of healthcare delivery are increasingly
Mumbai. The team is characterised by its very strong scientific background, with IT intensive. Further, there is broad recognition, especially in the US, that data
many of the members having achieved academic success in their specialist field analytics and customer-facing technologies will be critical to future success. The
before moving into industry, consulting or private equity directly. Led from London team is interested in segments of the market benefiting from exposure from
by Ian Jones, it is a stable team, with the core members having advised the last these drivers and led the US$1.5bn public-to-private of TriZetto in the US during
three Apax Funds. the summer of 2008.
The Healthcare group focuses exclusively on buyouts and has advised Apax
Funds on equity investments of over €2.2bn in companies such as Apollo Healthcare strategy The Healthcare team has specialists in each of the three
Hospitals, General Healthcare Group, Capio, Unilabs, Mölnlycke Health Care key areas of focus outlined above. It is focused on making investments in growth
Group, TriZetto and Qualitest Pharmaceuticals. areas where it has a proprietary angle, derived from its sector knowledge and
expertise. The primary focus of the team is on European and US opportunities but
Marketplace trends and drivers The Healthcare team focuses specifically on there are significant opportunities for transatlantic and global transactions,
three core areas globally: medical products, devices and supplies; speciality and reflecting the global nature of the healthcare industry.
generic pharmaceuticals and healthcare service providers and in addition, in the
US, on the healthcare IT space. Dynamics are different in each sub-sector. Outlook We believe that the healthcare sector remains dynamic and will
The key drivers in the medical products space are innovation, consolidation see increasing changes in how healthcare is provided and sourced. As a result of
and globalisation. There are pressures on many large medical product companies these changes, we anticipate that there will be far-reaching consequences in the
to divest non-core assets. In our opinion the medical products sub-sector has healthcare sub-sectors that we focus on. We continue to concentrate on areas
attractive LBO characteristics, displaying long-term growth prospects with good where rapid change and dislocations in the market are producing interesting
margins and cash flow characteristics. opportunities.
The pharmaceuticals space is characterised by increased commercial
pressures driving a re-examination of the business model. Ongoing consolidation
amongst the major pharmaceutical companies will drive portfolio rationalisation
and create opportunities for more nimble competitors. In the generics space, we
are witnessing continued strong growth in demand, balanced by consolidation and
aggressive competition; the sector remains an attractive area for the team to
focus on. Ian Jones
Across the broad sweep of companies that are covered by the healthcare
providers tag, the key dynamics are ageing populations, consumer awareness and
patient choice. Healthcare costs are forcing payers to re-assess the level of future
provision and the financing of care. New reimbursement models are emerging
including ‘pay by performance’ rather than ‘pay by procedure’. The sector is also
becoming increasingly regulated and specialised management teams are
emerging on a global basis, which are well equipped to deal with a rapidly
changing part of the healthcare sector.
“I feel that we are already seeing an improvement in our strategic planning –

specifically in our ability to look further into the future and make decisions
which will help us achieve the greatest impact – and this is largely thanks to
the support we receive from Apax on the strategic and financial planning side”.
Jeff Margolis, CEO, TriZetto

Healthcare continued
Case study: Healthcare Towards Integrated Healthcare Management Based in Newport Beach,
California, the TriZetto Group Inc. develops, licences and manages software
TriZetto solutions that link together constituents in the healthcare supply chain to improve
the coordination of benefits and care for healthcare consumers. The company,
which was founded in 1997 and achieved an IPO on NASDAQ two years later, has
approximately 2,000 staff and sells its software systems to over 350 separate
customers in the US health insurance and benefits administrator markets; all in all,
TriZetto technology touches approximately half the insured population of the US.
The deal In August 2008, Apax Europe VII and Apax US VII joined forces
with two of TriZetto’s core customers – Blue Cross Shield of Tennessee and
Regence Group – to take the company private in an investment worth
approximately US$1.5bn. On the decision to de-list TriZetto, founder and CEO
Jeff Margolis says: “Although the management team felt that TriZetto had a very
strong profile as a listed business, we also saw a major opportunity to secure the
investment that would get us closer to achieving our ultimate goal of Integrated
Healthcare Management. Clearly, the state of the public markets was also a
factor: we had predicted an extended period of volatility on the markets and
wanted to avoid the potentially destructive situation where management
resources are diverted away from the objectives of a business to deal with
PR issues. The option of a take-private by a strong backer offered us the chance
to secure real value for our shareholders and customers”.
Why Apax Partners? As far as the choice of partner was concerned Margolis
explains that the options had been varied: “There was significant interest in
TriZetto in late 2007 and into 2008, with something like 20 unsolicited approaches
from trade and financial bidders. We had already crossed paths with Apax before,
whilst analysing a potential acquisition, and on this occasion we were immediately
impressed by the team’s grasp of the long-term vision for the business and their
willingness to buy into this vision and trust the strengths of the company. In the
end, this, plus their relationship with two of our key clients, gave them the edge
and the three parties combined to win the bid.”
Since the deal completed In the few short months since the completion of
the deal the transition from public to private has been a seamless one. What is
more, as Margolis points out, the change has not affected the company’s
performance.
What about the future? The TriZetto and Apax Partners teams strongly
believe that healthcare systems in the US and elsewhere continue to suffer from
poor coordination and the company’s ultimate goal is to optimise benefits and care
via the principle of Integrated Healthcare Management. To achieve this, the
primary objective must be to continue to make investments that fuel growth, both
in terms of the development of TriZetto’s existing technology and services, and via
acquisitions that bolster the company’s footprint, increase its range of offerings
and, perhaps, expand its geographical coverage.
“Given the current market conditions, there are certainly opportunities out there.
They genuinely understand the business and although India is a different culture, the
fundamental business model of operating a hospital doesn’t change that much and
the experience they have as owners of hospitals elsewhere will be beneficial as we
continue to grow.The results of the partnership so far have been good and they have
given the company the freedom to take decisive action”.
Suneeta Reddy, Finance Director, Apollo Hospitals

Healthcare continued
Case study: Healthcare Bringing focused expertise to an Indian leader Treating over three million
patients every year, Apollo Hospitals is the largest private healthcare provider in
Apollo Asia. Apollo was established as a public company in 1979 by Dr P C Reddy, and
has been a pioneering force in Indian healthcare ever since. Today it operates a
network of 44 hospitals with around 7,000 beds. In addition to its hospitals
business, Apollo owns and operates one of the largest pharmacy chains in India as
well as primary care clinics, nursing homes, a health insurance business and one
of India’s largest medical outsourcing businesses.
The deal In mid 2007, Apollo was looking to raise equity capital in order to
expand. Suneeta Reddy, Apollo’s Finance Director, explains the rationale: “We had
a very clear sense that Apollo was poised for growth. Demand in the Indian
healthcare sector was, and still is, far greater than supply, the stock markets were
doing well and we wanted to capitalise on the opportunity.”
Why Apax Partners? As part of this sales process, the Apollo Management
team met with five or six other investors and ultimately chose Funds advised by
Apax Partners. Apax was always well placed due to its knowledge of the
healthcare sector in general and specific experience with hospital investments
such as Capio and General Healthcare Group in Europe. It also benefited from a
strong prior relationship with the company and with the Reddy family stretching
back to an initial meeting in the US in 2004.
Reddy continues: “We were looking for a strategic partner that could really
help the business maximise the opportunities that we saw. Most of the others
could provide the financing, but we felt that Apax understood the hospital
business much better and would also have the strategic know-how that we were
looking for. In terms of process, they were extremely thorough; they had
commissioned an external study and had a deep understanding of the market.
They were also able to complete the diligence very quickly and with a very high
level of understanding.”
Since the deal completed in October 2007, Apax Funds’ deal team has
advised management on a number of initiatives such as budgeting and
performance monitoring in the group, operational improvements and assessment
of potential acquisition targets. “We haven’t seen eye-to-eye on everything”, says
Reddy, “but they have been a surprisingly useful sounding board for the business
and their questioning approach has helped to get the best out of our team and,
at the end of the day, our interests are very closely aligned.
“They have also been effective at benchmarking our business against
performance in their European investments and have challenged us to drive
through operational improvements without compromising on clinical excellence.
The team have risen to this challenge and, as a consequence, the business has
become more profitable.”
What about the future? As more people demand a higher standard of
medical care, the growth potential for Apollo remains strong. The private hospitals
market is diverse and there is scope for further consolidation as well as organic
growth. The group also has ambitious plans to grow the number of pharmacies it
operates from 700 to 1,200 by 2010.
Financial &
Business Services
Worldwide, the FABS team is made up of 18 investment
professionals located across Apax Partners’ office network.
The team has a broad range of expertise spanning industry,
consulting and investment banking that enables Apax Partners
both to identify opportunities and to work deeply with portfolio
companies across the sector.
Top Financial & Business Services investments

Hub Investment year Enterprise value at Travelex Investment year Enterprise value at
International time of investment time of investment
2007 $2.0bn 2005 £1.1bn

Farmactoring Investment year Enterprise value at
time of investment
2006 €224m

Financial & Business Services partners
1. Mitch Truwit 4. Massimiliano Belingheri

Board seats Hub International Board seats Farmafactoring, Azimut,
Smart Technologies, Yell, PCM.
1 5 2006. Previously President and Chief Background Joined Apax Partners in
Executive Officer of Orbitz Worldwide, 2001. Prior experience at McKinsey and
2 Chief Operating Officer of priceline.com Morgan Stanley. Laurea in Economia in
3 and Head of Corporate Development for Government, Business & Economics from
Oxford Health Plans. BA in Political Universita’ Commerciale Bocconi, Milan,
Science from Vassar College. MBA from Italy. MBA from Harvard Business School
Harvard Graduate School of Business (Baker Scholar).
4 Administration.
5. Ralf Gruss
2. Michael Phillips
Office Hong Kong
Office Munich
Board seats IFCO, Kabel Deutschland,
Board seats Xerium, Sulo, IFCO, PVH, LR Health & Beauty Systems.
Tommy Hilfiger.
Background Joined Apax Partners in 2000 from Arthur D. Little. Degree in
1992. Prior experience at Ciba-Geigy Ltd. Financial Economics and Industrial
and Otto Waste Management Ltd. BSc Engineering from the University of
Honours in Engineering Chemistry from Karlsruhe. Studied Financial Economics
Queen’s University, Kingston, Canada. and Business Administration at the
MBA from INSEAD. London School of Economics and the
University of Massachusetts (Boston).
3. Frank Ehmer
Office London
Board seats CME, Emap, Tommy Hilfiger,
Authentos, Bundesdruckerei, Wind Hellas.
2000. Prior experience at the hedge fund
Highbridge in New York. Diploma from
Universität Mannheim. MBA from
Harvard Business School.

Financial & Business Services review
Overview The Financial & Business Services (‘FABS’) sector represents a In business services, the main drivers continue to be the implications of
substantial portion of the global economy, with approximately 18% of the market outsourcing and globalisation. In a recession, companies are looking to outsource
capitalisation of the MSCI Global Index in the sector. The sector itself more of their non-core functions, and are increasingly seeking partners that are
encompasses a diverse range of businesses, from diversified global financial able to fulfil these functions across their entire network. This will lead to
institutions to international business services companies, and countless regional, continuous growth within the sector to counterbalance the impact of the global
national and local players. recession. Governments’ commitments to free trade should support the
Worldwide, the FABS team is made up of 18 investment professionals globalisation of the sector and its consolidation as business services firms strive
located across Apax Partners’ office network. The team has a broad range of to meet their clients’ needs around the world.
expertise spanning industry, consulting and investment banking that enables
Strategy The team pursues different strategies for financial services and
Apax Partners both to identify opportunities and to work deeply with portfolio
business services, reflecting the unique dynamics of each sector.
companies across the sector.
In financial services, we target businesses that own strong customer-facing
Apax Funds have invested €1.4bn in the sector over the past 15 years.
franchises and have the potential to strongly benefit from a rebound in the
Marketplace/trends and drivers The financial services sector has been economy. We aim to support solid institutions to take advantage of the scarcity of
one of the main beneficiaries of the long term globalisation and deregulation available capital to pursue growth through acquisition in their vertical segments of
process that has transformed the global economy over the past 30 years. This operation.
long term trend will continue, despite the current credit crisis. After the global In business services, we believe that as the market tends to be
correction in asset values and a re-basing of GDP levels, normal growth will return, characterised by relative fragmentation there exists a substantial opportunity to
as will the need for financial services in both developed and developing regions. build and develop businesses of scale through organic growth and acquisition.
We remain confident that the financial services sector will out-perform GDP Our goal is therefore to acquire strong platforms that can be used to drive growth
growth in the future. both within their own markets and overseas and be positively exposed to a
However, whenever the speed of new product innovation and product rebound in the global economy.
complexity outstrip the limits of the available regulatory framework and risk
Outlook The trends underlying both the financial services and business
control systems, an imbalance is created. In this instance, the imbalance allowed
services industries mean that they are likely to continue to be highly geared to
a surplus of cheap liquidity to misprice risk in ‘repackaged’ sub-prime real estate
an economic rebound, and present attractive investment opportunities for the
assets and other financial debt products. The crisis was further fuelled by the
Apax Funds. Within financial services, scarcity of capital will present a unique flow
issuance of derivatives and insurance products in the form of credit default swaps
of investment opportunities as large groups seek to exit non-core businesses and
and credit wraps, without adequate requirements for regulatory capital. What
geographies and business models get redefined. Continued turbulence in the
appeared to be free money now burdens the financial markets with losses that
capital markets will create opportunities as firms seek strategic partners to help
cannot be financed. The only solution to stabilise the financial markets has been
them through the downturn. In business services, globalisation and consolidation
strong government intervention and the elimination of loopholes in the regulatory
will continue to present opportunities for investment in the sector.
framework of the banking sector. This process will continue through 2009 and the
effects will be felt for years to come.
We expect the financial services sector to be reshaped in the years to
come as financial services conglomerates (some of them government owned)
sell high quality non-core businesses to raise capital to restore their balance
sheets, repay government support and retrench to their core markets. Michael Phillips
While asset management, asset gathering, insurance and support services
will go through a cyclical downturn, the viability of wholesale funded business will
be severely tested. We expect the new wave of legislation and regulation to
restrict entry into the sector, increase core capital requirements and protect the
profitability of the existing institutions.

Financial & Business Services continued
Case study: Financial & Business Services Farmafactoring S.p.A. is the leading provider of credit management services
to suppliers to the Italian public healthcare system, the Servizio Sanitario Nazionale
Farmafactoring (‘SSN’). The company was founded in 1985 by a group of Italian and multinational
pharmaceutical and biomedical companies to alleviate the cash-flow difficulties of
the SSN’s suppliers, who were affected by the traditionally long payment cycles of
its constituent health authorities.
Farmafactoring purchases and manages the collection of its clients’
receivables, allowing them to completely outsource their accounts receivables
management function. In addition to providing non-recourse factoring,
Farmafactoring also provides receivables management services for clients who
choose to retain them on their own balance sheets.
Farmafactoring’s strong relationships with the SSN’s local health authorities
across Italy and deep knowledge of their payment patterns allows the company to
price its products very competitively, while its scale gives it a strong bargaining
position when negotiating payments from the health authorities.
The deal The company was attractive to Apax Funds as it is the clear market
leader with a defensible competitive position in a growing sector. Historically,
growth in public healthcare expenditure has not been impacted by the economic
cycle and, in addition, the company has identified several growth opportunities,
including providing its services to a wider range of suppliers to the SSN and to
other parts of the Italian public sector, launching new products to its existing
clients, and expanding internationally.
Why Apax Partners? In December 2006, the Apax Europe VI fund won an
auction to acquire a 91.7% stake in Farmafactoring. The Apax deal team had been
developing an understanding of Farmafactoring’s business and prospects for some
time prior to the decision by the company’s shareholders to begin the sale
process, and their extensive knowledge of the business provided a key
competitive advantage during the auction process.
What about the future? Since the acquisition, the business has continued
to perform strongly and the Apax deal team has advised the company’s
management to put in place preemptive measures to counter any shocks
resulting from the volatility of the credit markets.
In addition, a series of initiatives has been launched to optimise the key
value drivers of the business, including targets to encourage the collection of as
much default interest as possible from the existing book of business, buying
portfolios of receivables outside the existing client base, and improvements to the
funding structure of the business.
Finally, the company has completed the necessary groundwork to expand
its operations to Spain to leverage its expertise with public healthcare payers in a
market with similar dynamics to Italy.
4
88 89
Section 4:
Our investors
90 Investors review
98 Current portfolio listing

Total funds raised
At 31.12.2008
€26.6bn
At 31.12.2008
£25.7bn
At 31.12.2008
US$36.9bn
Our Investors The development of Apax Partners
Our investors are our clients and the relationship with our investors is at the Investor breakdown by type In How the Funds have evolved The history of Apax Partners is interwoven
heart of our business and indeed drives our business. Advising the Apax Funds to with the development of the private equity asset class on both sides of the Atlantic.
which our investors have committed, understanding what they are looking for Public pension funds 31.77% Throughout its 30-year history, Apax Funds have successfully invested
from their investment, and working with them to provide enhanced returns drives Private pension funds 14.16% across all investment stages, and through several complete economic cycles.
the Apax Partners strategy and that of the Investor Relations (IR) team. The IR Funds of funds 11.14% The firm’s current focus on large buyouts is rooted in a culture that has
team places significant emphasis on three key areas: (i) investor communication; High net worth individuals 10.28% always been outward looking, pioneering and committed to growing businesses.
(ii) relationship development and (iii) content improvement. The primary principle Insurance 9.76% The deep understanding of the five sectors in which its Funds invest has been at
applied across the three areas is to be transparent, by providing detailed and Banks 7.05% the core of Apax Partners’ strategy, giving it early access to investment
frequent information through formal and informal communication channels. Endowments 6.14% opportunities and an ability to add value quickly to portfolio companies.
Sovereign funds 5.18%
Investor communications The IR team advise our Guernsey office on Gatekeepers 4.52%
Emilio Voli Partner, Investor Relations communications with our investors. This includes quarterly reports and activity
updates (or press releases) upon the occurrence of significant events such as the Year of first Total amount
making or disposal of an investment. Formal reporting is sent directly to investors Fund investment raised (m)
and there is also a secure Extranet providing online access to financial, legal and UK I
Apax Venture Capital Fund 1982 £10.15
reporting information for investors, as well as copies of presentations given to Apax Ventures II 1984 £30.12
investors at the Annual Meeting, Boards of Advisers Meetings, as well as Minutes Apax Ventures III 1987 £75.00
of the Boards of Advisers Meetings. Investor breakdown
Apax Ventures IV 1990 £109.60
Apax UK V 1995 £164.00
In addition to the above, the Funds Administration team provides quarterly by type Apax UK VI 1997 £313.20
Capital Statements to Investors and audited Financial Statements for the Apax Pan-European
Fund Partnerships and can assist in answering more technical and accounting Apax Europe IV 1999 €1,803.15
queries from investors. A specialist tax team is also available to assist in the Apax Europe V 2001 €4,404.30
Apax Europe VI 2005 €4,310.33
provision of tax reporting information. Apax Europe VII 2007 €11,204.27
Relationship development The IR team manages a thorough relationship Germany

David Whitehouse Partner, Investor Relations APA German European Ventures 1992 €49.39
development programme ensuring investors receive relevant updates as well as Apax Germany II 1997 €133.20
access to senior investment professionals across the firm. The opportunity for one- Investor breakdown by geography Israel
on-one meetings is regularly offered to current and potential investors in the funds Israel Growth Fund 1994 US$40.05
and meetings are taken by both the IR team and the investment professionals.
P US 40.21% Apax Israel II 1999 US$102.50
The IR team is keen to develop long-serving relationships with investors Continental Europe 24.54% United States
and seeks to understand through these relationships what investors are looking Excelsior Fund 1981 US$25.53
UK 13.98%
Excelsior II 1985 US$109.13
for, how best to deliver this, and make ongoing proposals to investors as Canada 11.59% Excelsior Jersey 1985 US$29.82
appropriate. Asia 8.13% The P/A Fund 1987 US$40.40
Excelsior III 1989 US$175.00
Oceania 1.56%
Content improvement Apax Partners recognises that investors’ demands P/A Fund II 1993 US$60.61
Excelsior IV 1995 US$265.15
and requirements for information are constantly evolving. Therefore Apax Partners P/A Fund III 1997 US$100.00
has built an appropriate infrastructure to collect information to support investor Excelsior V 1998 US$406.00
needs, as well as to be able to communicate to investors on topical issues as they Excelsior VI 2000 US$1,100.00
Apax US VII 2006 US$856.34
Nadia Preston Head of IR Client Services
emerge. Investors have the opportunity to pose ad-hoc questions via the IR team SKM Equity Fund I 1993 US$300.00
and we ensure they receive a timely response. SKM Equity Fund II 1996 US$516.00
SKM Equity Fund III 2000 US$720.00
Investor breakdown
Japan
by geography Apax Globis Japan Fund 1999 ¥20,000.00
Other
Apax European Buy-In Fund 1989 €300.00
The firm believes that private equity has the ability to deliver excellent returns to
investors by bringing better governance to companies, by improving operational
performance and by ensuring full alignment of interest between investors and
company management.
Our Investors
Case study: Investor AlpInvest Partners independently manages the private equity investments
for two of the world’s largest pension funds: Dutch ABP and PFZW. The pension
AlpInvest funds’ beneficiaries are civil servants, teachers and healthcare workers, all
participating in sector based defined benefit schemes.
While ABP and PFZW had successful histories as private equity investors,
the funds concluded that their long-term commitment to the market would best
be served by an independent, dedicated and full-scale private equity organisation.
AlpInvest Partners became the exclusive private equity manager for these funds
in 1999 and bears full discretionary power over all investment decisions.
AlpInvest Partners is one of the few private equity investors with the
financial scale and global reach to partner with the world's largest private equity
firms as well as the specialised high-performers. With €40bn of assets under
management, AlpInvest Partners has the ability to provide substantial
commitments to partners’ funds and also to support them with meaningful equity
and mezzanine co-investment in their portfolio companies.
In portfolio construction AlpInvest Partners takes a long-term investment
perspective by analysing the global economic trends effecting private equity. AlpInvest
Partners follows a deliberate allocation process: top-down segment analysis and
bottom-up partner selection.
The top-down approach includes analysis of the general characteristics, size
and growth of all private equity market segments.
In investment selection the fund investments team performs extensive due
diligence in order to be able to identify the best-in-class general partners based on
the desired geography, industry focus and stage of life focus. In conducting this
due diligence, the team leverages AlpInvest Partners’ firm-wide resources and
intelligence. With first-hand knowledge collected from the co-investments team
along with the market visibility of the secondary investments team, AlpInvest
Partners is able to quickly and efficiently identify trends, integrate knowledge and
capture opportunity.
AlpInvest Partners’ success is driven by partnering with experienced private
equity investors, operating within well structured teams with solid investment
histories. This requires our partners to be responsible owners of their portfolio
companies. AlpInvest Partners is engaged in the discussions on implementation of
the UN Principles for Responsible Investment in the private equity space and
promotes portfolio companies to subscribe to the UN Global Compact principles.
Some relationships, such as the Commonfund-Apax relationship, date back two

decades to the very first commitments made outside of the US by Commonfund
Capital. Commonfund Capital places a high value on these relationships, seeking to
be a trusted partner and adviser to select, high quality general partners.
Our Investors
Case study: Investor Commonfund Capital LP Founded in 1971, Commonfund is a non-profit

investment management company devoted to enhancing the financial resources
Commonfund of non-profit institutions and social enterprises including educational endowments,
foundations, hospitals and healthcare systems, cultural, social service and faith-
based organisations and other charities located in the US, Canada, the United
Kingdom and elsewhere. Commonfund Capital is the private capital arm of
Commonfund. Since the founding of Commonfund Capital in 1988, the mission
has remained the same: to provide organisations with a total solution for private
capital investing – venture capital, private equity and natural resources. With
offices in Wilton, Connecticut and London, UK, Commonfund Capital is staffed by
more than 40 investment professionals and serves over 700 institutional investors
from the non-profit community. Since the formation of Commonfund Capital, the
group has managed 37 fund-of-fund programmes totalling over US$11bn in private
capital commitments. Within these programmes, Commonfund has forged
partnerships with 188 direct private capital management groups around the globe.
There are several fundamental factors that continue to testify to the
strength and success of the private capital industry that distinguish the private
capital model in any environment, weak or strong. These advantages include
strong competitive urgency, long-term horizon, strong governance, aligned
incentives, focus on strong management talent, stable shareholder base and
efficient capital structures. From a portfolio allocation standpoint, the key to
potential success in this asset class is to partner with top tier private capital
managers in a diversified programme in order to access the vast and largely
distinct opportunity set private companies represent.
The manager selection process for a private capital programme considers
such fundamental issues as the quality and experience of the manager's team,
investment philosophy and past performance. Assessment includes the strategic
fit of the manager’s investment approach with investment objectives of the
organisation and conduct of a number of qualitative and quantitative analyses.
More specifically, this could be a review of factors such as quality of team,
investment strategy, investment and exit experience, alignment of interest, ability
to add value to portfolio companies, commitment/motivation, firm culture, due
diligence expertise, deal sourcing, firm governance, prior track record and
distribution policies. This work, accompanied by structured risk management, legal
negotiation and documentation in the commitment phase, is key to building a
private capital programme. After the commitment period, the focus becomes
ongoing monitoring and dialogue with the manager during the investment life of
manager commitments.
Commonfund Capital works on advisory boards for private capital
managers around the world.
Our partnership with Apax Partners is now in its third decade, and is an impressive
example of the high-quality relationships which GIC SI seeks to establish globally.
Our Investors
Case study: Investor GIC The Government of Singapore Investment Corporation (GIC) has been
the manager of Singapore’s foreign reserves since 1981. The GIC Group strives to
GIC achieve good long-term returns on assets under its management, to preserve and
enhance Singapore's reserves. Owned wholly by Singapore’s Ministry of Finance
but reporting to its own Board of Directors, GIC operates as a private fund
management company with the sole objective of generating financial returns
through its main subsidiaries: Public Markets, Real Estate and Special Investments
(SI). GIC is today one of the largest investment management organisations in the
world, investing well over US$100 billion in multiple asset classes in more than 40
countries.
GIC SI’s team of 70 investment professionals operates from offices in
Singapore, London, New York, Silicon Valley and Beijing, and adopts a globally
integrated approach in its selection of fund manager and direct investments.
The GIC SI portfolio includes limited partner interests in leading global and regional
funds focused on investments in buyouts, venture capital, infrastructure and
mezzanine. Minority equity and mezzanine investments are also made directly in
well-run companies. GIC SI further invests directly in infrastructure assets
worldwide. GIC SI’s investment team adds value to fund managers and investee
companies by providing advice and access to a global network of business links
which GIC SI has developed over the years.
The GIC perspective is that of a long-term investor over various economic
cycles. For over 25 years, the firm has identified and invested with outstanding
private equity fund managers and grown with them over time. Our partnership
with Apax Partners is now in its third decade, and is an impressive example of the
high-quality relationships which GIC SI seeks to establish globally.
Current portfolio
Following is a complete list of all live
Apax Funds portfolio companies.
Year of initial Starhome BV 2004 Year of initial Procognia Limited 2002 *UK Walker-compliant portfolio companies New Look Group
Tech & Telecom investment Media investment New Look is a retailer of value fashion clothing and the third
Streamserve Inc 1999 Prometheus Laboratories 1999
largest womenswear retailer in the UK. The company has
Bezeq The Israel Telecommunication Corp 2005 Cengage – Nelson Education 2007 Emap
Synetrix Holdings Limited 2004 Qualitest Pharmaceuticals 2007 nearly 600 stores in the UK and over 270 stores trading
Emap is the UK’s leading business information provider.
BitBand Inc 2003 Cengage Learning 2007 under the MIM format in France. The initial investment
TDC A/S 2005 Senex Financial 2004 The company provides information to its customers
in this company was made by the Apax Europe IV and
BlueArc Corporation 2000 Central European Media Enterprises Ltd 2006 through four key formats: print and online magazines,
Tideway Systems Limited 2004 Sense Proteomic Ltd/Procognia 1998 Apax Europe V funds in 2004.
exhibitions and festivals, digital information services,
Centerbeam 2000 Emap* 2007
Transera Communications 2004 SkinMedica 2003 and conferences. The initial investment from Apax Funds Turnover (53 weeks to 29 March 2008)
Composite Software 2002
Versatel AG 2005
HIT Entertainment* 2005
Spectrum Holding Company 2005
was made by Apax Europe VII in 2007. £1,169.1m
Corvil Networks Limited 2003 Incisive Media Limited* 2006 Turnover (year to 31 March 2008) Number of employees
Crescendo Networks Limited 2003
Weather Investments SpA
Wisair Inc
2008
2002
Quartermaster 2005
The TriZetto Group
Voyager HospiceCare
2008
2004
£283.3m 20,405
Number of employees
CSG Solar AG
Dialog Semiconductor Plc
2005
1998
SportsMyx Holdings
Stage Three Music Limited
2005
2004
Wilex AG 1998 1,588 Somerfield
Xanodyne Pharmaceuticals 2005 Somerfield is the fifth largest grocery retailer in the UK, operating
Digital Fuel Technologies Inc 2005 Year of initial Telcast Media Group GmbH 2001 out of small, local stores to serve the ‘convenience shoppers’
ZymoGenetics 2000 General Healthcare Group Limited
Retail & Consumer investment market. In July 2008, funds advised by Apax Partners agreed the
Elliptec Resonant Actuator AG 2004 The Learning Annex 2006 General Healthcare Group is the leading provider of
sale of Somerfield to the Co-operative Group for £1.565bn.
Ale House Holdings 2004 independent health care services in the UK. Its primary
Frontier Silicon Holdings Limited 2003 The NewsMarket 2000
businesses are BMI Healthcare and Netcare UK. The initial investment in this company was made by the Apax
Bob’s Discount Furniture 2005
Handmark 2001 Trader Media Group* 2007 Year of initial BMI Healthcare is the acute care private hospital division and Europe VI fund in 2005.
Café Rio 2004 Financial & Business Services investment Netcare UK provides specialised clinical services to patients
InnovaLight 2004 Truvo/World Directories 2004 Turnover (year to 30 April 2008)
Iris Financial Engineering Holdings Ltd 2003
Comark 2005
VoodooVox 2001
Bolero.net 2000
under contract to the National Health Service. The initial
investment in this company was made by the Apax Europe VI £4,221.4m
D+S europe AG 2008 Builders TradeSource 2003 fund in 2006. Number of employees
mFoundry 2003
Home Organizers 2000 Contech Construction 2006 Turnover (year to 30 Sept. 2008)
40,855
Midasplayer/King.com
Mobixell Networks
2005
2000
LR Health & Beauty Systems GmbH 2004 Year of initial CorMine 2005 £772.6m
Healthcare investment Number of employees Trader Media Group
Nanomix 2002
New Look Group*
Norcraft Companies
2004
2003
Aerovance 2004
Electro – Stocks Grup S.L.
Farmafactoring S.P.A.
2007
2006
8,473 Trader Media Group is one of Europe’s largest specialist multi-
media publishers, with market-leading automotive classified
NXP 2006
Affymax Pharmaceuticals 2001 websites, over 70 leading classified titles and a high-volume
Ollie’s Bargain Outlet 2003 Hub International 2007
OnePath Networks Limited 1997 HIT Entertainment printing business.
AngioDynamics 1999
Panrico, S.A. 2005 IFCO Systems N.V. 2003 Hit Entertainment is the world's largest independent
Onespin Solutions GmbH 2005 Autotrader is the leading player in the UK automotive print
Apollo Hospitals Enterprise Ltd 2007 owner and distributor of pre-school children's content.
Plantasjen 2007 L3 2000 classified market and autotrader.co.uk is the leader in the online
Peregrine Semiconductor 1997 Hit owns brands such as Thomas and Friends, Bob the
Ascent Healthcare 2000 segment.
rue21 1998 PlanView 2004 Builder, Barney the Dinosaur, Pingu, Fireman Sam and
Pictage 2006
Astex Technology Ltd/Metagen GmbH 2001 Angelina Ballerina. The initial investment in this company The initial investment in this company was made by the Apax
S.B. Restaurant 2000 Plexus Systems 2006
Power Paper Limited 2005 was made by the Apax Europe VI fund in 2005. Europe VII fund in 2007.
Cadent 2000
Savaria Corporation 1998 RealPage 2003
PowerID Limited 2007 Turnover (year to 31 July 2008) Turnover (year to 31 March 2008)
Printar Limited 2004
Sisal S.p.A. 2006
Capio AB
Celldex Therapeutics
2006
2003
Travelex Holdings Limited* 2005 US$273.8m £309.1m
Somerfield Ltd* 2005 Number of employees Number of employees
Promethean Ltd
RaySat, Inc.
2004
2005
Spyder Active Sports 2004
Dune Medical Devices Limited 2004 384 3,527
General Healthcare Group Limited* 2006 Year of initial
Teavana Holdings 2004
Red-M Group 2001 Other investment
Magnacare Holdings 2002 Incisive Media Limited Travelex Holdings Limited
Tnuva 2008
SMART Technologies 2007 Applied Tech 1997 Incisive Media is a business-to-business information Travelex is the world's largest non-bank provider of commercial
Novacea 2004
Tommy Hilfiger Corp 2006 provider. The business operates across the main areas of foreign exchange services, providing integrated payment
Basic Energy Services 2005
Orexo AB (Biolipox AB) 2002 financial services, with leading brands in the financial, legal, solutions for business customers globally. Travelex operates
Xerium Technologies 1999
Precision Partners 1998 accountancy, real estate and IT sectors. The initial over 700 retail foreign exchange branches around the world.
investment in this company was made by the Apax The initial investment in this company was made by the Apax
Europe VI fund in 2006. Europe V and Apax Europe VI funds in 2005.
Turnover (year to 31 Dec. 2008 – unaudited) Turnover (year to 31 Dec. 2008)
£224.7m £583.7m
Number of employees Number of employees
1,899 5,554
100
Apax Partners international offices
China Italy
Apax Partners Hong Kong Ltd Apax Partners S.r.l.
16th Floor Palazzo Gallarati Scotti
Nexxus Building Via A. Manzoni, 30
41 Connaught Road Milan 20121
Central Hong Kong Italy
People’s Republic of China T: +39 02 762 1191
T: +852 2297 2313
India
China Apax Partners India
Apax Investment (Shanghai) Advisers Private Limited
Company Ltd 2nd Floor
65th floor Devchand House
Shanghai World Financial Center Shivsager Estate
100 Century Avenue Dr Annie Besant Road
Pudong New District Worli
200120, Shanghai Mumbai – 400018
People’s Republic of China India
T: +86 21 5198 5656 T: +91 22 4050 8400
Germany Spain
Apax Partners Apax Partners España, S.A.
Beteiligungsberatung GmbH Velázquez 10-5°
Possartstrasse 11 28001 Madrid
Kopernikustrasse Spain
81679 Munich T: +34 91 423 1000
Germany
UK
T: +49 89 998 9090
Apax Partners UK Ltd
Guernsey 33 Jermyn Street
Third Floor London SW1Y 6DN
Royal Bank Place United Kingdom
1 Glategny Esplanade T: +44 (0)20 7872 6300
St Peter Port
USA
Guernsey GY1 2HJ
Apax Partners, L.P.
T: +44 (0)1481 810 000
53rd Floor
Israel 153 East 53rd Street
Apax Partners (Israel) Ltd New York, NY 10022
Museum Tower USA
4 Berkowitz Street T: +1 212 753 6300
Tel Aviv 64238
Israel
T: +972 3 777 4400
For any questions on this Report please For any questions on this report please
contact Ben Harding in the UK office. contact Ben Harding in the UK office.

Table of contents
www.apax.com

4 Apax Funds
1 Section 1:
Overview

from Martin Halusa
19 Our global reach
2 Section 2:
Governance
32 Our values
3 Section 3:
42 Sector review
Tech & Telecom
52 Sector review
Retail & Consumer
62 Sector review
Media
70 Sector review
Healthcare
80 Sector review
4 Section 4:
Our investors
90 Investors

Front cover:

Private Equity Apax Partners 2008 Annual Report

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Private Equity Apax Partners 2008 Annual Report

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12739_R&A08_Cover:Layout 1 24/6/09 11:38 Page 1

Apax Partners Annual Report 2008

Apax Partners Annual Report 2008 2 Performance highlights

10 Chief Executive’s letter

Designed and produced by RadleyYeldar

Apax Partners Annual Report 2008

Apax Partners Annual Report 2008 2 Performance highlights

10 Chief Executive’s letter

Designed and produced by RadleyYeldar

The development of Apax Partners Total funds raised

€1.8bn €4.4bn €11.2bn

1980: Excelsior Fund The US firm 1994 Israel

£10.15m Munich office

2002: European and US operating 2004: Succession

Find out how we got here

Apax Partners Annual Report 2008 1

About usApax Partners is an independent global partnership

Our mission Ourmission is to release the untapped potential

2 Apax Partners Annual Report 2008 3

2008 Performance highlights

1.07bn Average portfolio profit growth, last ten years

Dow Jones/Private Equity

Investor breakdown by type In

Public pension funds 31.77% FinancialTimes-Mergermarket

Endowments 6.14% 30%

Sovereign funds 5.18% Winner Fundraising of theYear

Net IRR top decile benchmark 2

Financial News/Private Equity

0% 15 year 10 year Net debt/EBITDA multiple

4 Apax Partners Annual Report 2008 5

Apax Funds live portfolio summary

Retail & Consumer 29.73%

Portfolio equity value

Sale agreed July 2008, completed March 2009

*Walker: UK compliant †BVK: Germany compliant

10 Chief Executive’s letter

19 Our global reach

20 China – opportunities and challenges

8 Apax Partners Annual Report 2008 9

10 Apax Partners Annual Report 2008 11

Chief Executive’s letter

12 Apax Partners Annual Report 2008 13

Chief Executive’s letter

Although there will inevitably be consolidation in the industry, in the

14 Apax Partners Annual Report 2008 15

Focus on company results

5Apax Partners focuses on five industry

16 Apax Partners Annual Report 2008 17

Investment strategy Investment strategy

Apax Partners deal selection criteria

Is it a global company or does it have the potential to be?

18 Apax Partners Annual Report 2008 19

20 Apax Partners Annual Report 2008 21

Richard Zhang Apax Partners Greater China

28 Governance and compliance

34 The wider community

24 Apax Partners Annual Report 2008 25

26 Apax Partners Annual Report 2008 27

How we are run

28 Apax Partners Annual Report 2008 29

How we are run

Fund Advisory Boards As well as the internal corporate governance bodies,

30 Apax Partners Annual Report 2008 31

How we are run