M&A Activity

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Monthly Overview of Global
317.581.6127
Analysis Middle-Market M&A Activity
January 2010
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Table of Contents
Commentary 1
Global Activity 3
Regional Transactions 3
Middle-Market Regional Transactions 4
Annual Transactions 5
U.S. M&A Activity 6

Transaction Detail 6
Annual Activity 7
Valuation Multiples 8
Private-Equity Transaction Analysis 9
Transaction Breakdown 11
Industry Breakdown 13
Cross-Border Transaction Analysis 14
U.S. Financing Markets 16

Debt Capital Markets 16
Equity Capital Markets 18
European M&A Activity 19

Transaction Detail 19
Annual Activity 20
Valuation Multiples 21
Private-Equity Transaction Analysis 22
Emerging Markets M&A Activity 23
Select William Blair & Company Transactions 24
William Blair & Company Corporate Finance Contact List 27
Notes 29
Disclosures 30
Commentary
Commentary
OVERVIEW
Global M&A activity for December reinforced the belief that the M&A markets may have finally turned the corner.
For several months we have pointed to the increasingly positive signs that would help fuel the rebound in activity.
These signs included a surging stock market, near-record amount of private-equity capital available for
investment, and increased optimism that the worst of the economic downturn and financial crisis had passed.
While the economic outlook remains uncertain, we sense a more positive tone and outlook among our clients
and an increased willingness to entertain and consider acquisition opportunities. These factors have contributed
to the recent uptick in the $1 billion-plus transactions announced over the past month several months, a trend
that has continued into January. We continue to believe that there is significant momentum as we start the new
year, which should continue well into 2010. For 2010, we believe:
The current near-term outlook should continue to improve amid a more favorable economic outlook and the
rebound in equity prices. This increased optimism and improved environment will likely drive a rebound in
announced M&A activity in 2010.
Strategic buyers can no longer rely on cost cutting to drive growth and will need to consider acquisitions to
drive expected top-and bottom-line growth.
Strategic buyers – public companies with high stock prices, clean balance sheets, and stable cash flows have
the ability to take advantage of the market turmoil to make opportunistic transactions. (Xerox, Cisco, Disney,
Tyco, etc).
Private equity will continue to experience lower deal activity as the credit markets remain extremely tight.
However, there is an estimated $400 billion of uncommitted capital still available when credit markets
eventually open up.
The amount of hostile deal activity will continue to increase as activist shareholders and hedge funds target
underperforming companies.
The number and volume of bankruptcy and distressed transactions will likely remain at or near record levels.
Valuation levels appear to be stabilizing, having declined sharply over the past two years.
GLOBAL M&A HIGHLIGHTS

For December, the number of announced global transactions totaled 2,923, a modest decline of 11.2%
compared with the corresponding period last year.
However, the total disclosed dollar volume for the month was $228.5 billion, a gain of 47.9% compared with
the corresponding period last year.
Global M&A activity turned in its second-highest monthly dollar volume total since July 2008 and has
exceeded $200 billion in three of the past four months (averaging $205 billion) after averaging just $150
billion.
For all of 2009, the total number of transactions declined 14.1% compared with the prior-year period. All five
regions were down, ranging from an 8.7% decline for Europe to a 25.7% decline for Latin America.
In December, the total number of announced middle-market transactions declined a modest 10.3% compared
with the corresponding period last year, driven by a nearly 20% decline in Europe.
However, there was a 21.4% increase in the total announced dollar volume compared with the corresponding
period last year, as all five regions reported sizable increases.
As is the case with the overall market, all regions ended the full year down solidly compared with 2008.
Overall, the total year-to-date number of middle-market transactions declined 17.3% compared with the
corresponding period last year, with three of the five regions showing declines in excess of 25%.
The full-year middle-market disclosed dollar volume also ended significantly below the 2008 totals. The dollar
volume of $759 billion was 30.5% below the 2008 total.
U.S. M&A HIGHLIGHTS

U.S. M&A activity for December showed continued improvement as announced U.S. M&A activity totaled 831
transactions, a decline of just 2.6% compared with the corresponding period last year. This was the third-highest
monthly total for the year and well above the monthly average of 756 transactions.
www.williamblair.com 1
Commentary (cont'd)
Commentary (cont'd)
The dollar volume of transactions totaled $117.0 billion, the highest monthly total since July 2008. This total
was significantly higher than the $35.8 billion last year, and nearly double the monthly average of $66.6
billion. The increase in dollar volume reflected a sizable increase in the number of large transactions.
Middle-market activity for the month was also relatively strong, despite a modest 4.6% decline compared with
the prior-year period. There were 372 disclosed middle-market transactions, compared with the monthly
average of 334. Middle-market dollar volume rose 29.8%, to $24.1 billion, and was significantly higher than
the monthly average of $18.8 billion.
For the full year, the total number of U.S. transactions was 9,054, a decline of 20.3% and the lowest total
since 2003. Despite a sharp increase in the last three months, the full-year dollar volume totaled just $880.1
billion, also the lowest total since 2003.
Full-year middle-market totals were down 15.4% for transactions and 34.9% for dollar volume.
Average deal size for the month was $300.8 million, raising the full-year average to $212 million, compared
with $220.5 million for 2008 and $355 for 2007.
For the month, there were just 88 U.S. related private-equity transactions, more than 25% below the year-ago
period and also well below the monthly average of 112.
The dollar value of $8.0 billion was more than 50% above the comparable period last year, although it was
still less than the trailing-12-month average of $10.8 billion.
The computer and electronics sector remained the most active sector for private-equity investors, with 336
announced transactions for the year. This total was more than the next two sectors combined — healthcare
(157 deals) and professional services (156 deals). These three industries alone represented approximately
50% of the total.
Private companies have continued to take advantage of the market turmoil and increased their acquisition
activity relative to the other market participants. Private companies now represent 47.3% of acquirers, up
from 38.3% in 2008. Private companies also continue to account for the majority (61.7%) of all transaction
targets, although their share has declined from 2008.
Overall EBITDA multiples continue to decline, reflecting the slowdown in the economy and reduced
competition between strategic buyers and private-equity firms. For the overall market, the valuation multiple
has declined to 7.9x EBITDA, compared with 9.3x for 2008. In the middle market, the multiple has declined
from 8.2x EBITDA in 2008 to 7.1x EBITDA.
EUROPEAN M&A HIGHLIGHTS

European M&A activity for December was not quite as robust as in the United States.
The total number of announced deals for the month was 877, a 24.1% decline compared with the
corresponding period last year and well below the trailing-12-month monthly average of 1,213.
The total dollar volume for the month jumped to $88.7 billion, an increase of 23.7% compared with the
corresponding period last year and significantly above the trailing-12-month monthly average of $64.7 billion.
European middle-market activity was just 380 announced deals, down 18.1% compared with the
corresponding period last year, while the dollar volume of $30.9 billion represented a 28.4% increase.
The median enterprise value/EBITDA multiple for all European transactions continues to decline, coming in at
6.6x for the LTM period, down from 9.4x for all of 2008 and 11.0x for 2007.
For middle-market deals over the past 12 months, the median enterprise value/EBITDA multiple has declined
to 6.6x, from 8.6x EBITDA for 2008.
Global Activity
Global Activity Regional Transactions
Global M&A activity finally appears to be turning the corner.

For December, the number of announced global transactions totaled 2,923, a modest decline of 11.2%
compared with the corresponding period last year.
However, the total disclosed dollar volume for the month was $228.5 billion, a gain of 47.9% compared
with the corresponding period last year.
Global M&A activity turned in its second-highest monthly dollar volume total since July 2008 and has
exceeded $200 billion in three of the past four months (averaging $205 billion) after averaging just $150
billion.
For all of 2009, the total number of transactions declined 14.1% compared with the prior-year period. All
five regions were down, ranging from an 8.7% decline for Europe to a 25.7% decline for Latin America.
The dollar volume for 2009 declined 24.9% compared with the prior-year period. Although Africa/Middle
East and Asia-Pacific both showed an increase compared with 2008, large double digit declines in both
Europe and North America resulted in an overall decline for the year.
Global M&A Activity Detail

NUMBER OF DEALS DEAL VALUE
% Change % Change
2007 2008 2009 '09 vs. '08 2007 2008 2009 '09 vs. '08
DECEMBER
North America 965 832 813 (2.3%) $119,392 $29,711 $104,327 251.1%
Latin America 83 82 94 14.6% $8,797 $8,651 $8,947 3.4%
Europe 1,191 1,002 737 (26.4%) $142,050 $55,785 $49,771 (10.8%)
Africa / Middle East 73 56 74 32.1% $20,850 $3,656 $5,409 48.0%
Asia Pacific 1,364 1,318 1,205 (8.6%) $61,177 $56,774 $60,090 5.8%
TOTAL 3,676 3,290 2,923 (11.2%) $352,266 $154,576 $228,544 47.9%
YTD
North America 12,446 10,700 8,579 (19.8%) $1,615,983 $947,947 $763,383 (19.5%)
Latin America 1,211 1,074 798 (25.7%) $93,621 $103,598 $85,788 (17.2%)
Europe 13,324 13,976 12,764 (8.7%) $1,797,105 $1,043,002 $540,449 (48.2%)
Africa / Middle East 774 993 753 (24.2%) $107,227 $55,132 $62,463 13.3%
Asia Pacific 14,274 14,204 12,285 (13.5%) $658,840 $544,175 $571,790 5.1%
TOTAL 42,029 40,947 35,179 (14.1%) $4,272,777 $2,693,854 $2,023,873 (24.9%)
LTM
North America 12,446 10,700 8,579 (19.8%) $1,615,983 $947,947 $763,383 (19.5%)
Latin America 1,211 1,074 798 (25.7%) $93,621 $103,598 $85,788 (17.2%)
Europe 13,324 13,976 12,764 (8.7%) $1,797,105 $1,043,002 $540,449 (48.2%)
Africa / Middle East 774 993 753 (24.2%) $107,227 $55,132 $62,463 13.3%
Asia Pacific 14,274 14,204 12,285 (13.5%) $658,840 $544,175 $571,790 5.1%
TOTAL 42,029 40,947 35,179 (14.1%) $4,272,777 $2,693,854 $2,023,873 (24.9%)
Source: Dealogic and William Blair & Company, L.L.C. Mergers and Acquisitions market analysis.
Global Activity (cont'd)
Global Activity (cont'd) Middle-Market Regional Transactions
In December, the total number of announced middle-market transactions declined a modest 10.3%
compared with the corresponding period last year, driven by a nearly 20% decline in Europe.
However, there was a 21.4% increase in the total announced dollar volume compared with the
corresponding period last year, as all five regions reported sizable increases.
As is the case with the overall market, all regions ended the full year down solidly compared with 2008.
Overall, the total year-to-date number of transactions declined 17.3% compared with the corresponding
period last year, with three of the five regions showing declines in excess of 25%.
The full-year disclosed dollar volume also ended significantly below the 2008 totals. The dollar volume
of $759 billion was 30.5% below the 2008 total. Latin America fared the best, experiencing a modest
decline of just 1.9%, while Europe continues to struggle, ending the year down 48.1% compared with
2008.
Global Middle-Market M&A Activity Detail

% Change % Change
2007 2008 2009 '09 vs. '08 2007 2008 2009 '09 vs. '08
DECEMBER
North America 357 401 375 (6.5%) $29,747 $17,015 $18,914 11.2%
Latin America 40 48 44 (8.3%) $4,984 $2,866 $3,018 5.3%
Europe 504 383 307 (19.8%) $46,538 $19,116 $23,190 21.3%
Africa / Middle East 36 33 37 12.1% $2,560 $2,251 $3,220 43.1%
Asia Pacific 1,093 1,016 925 (9.0%) $38,375 $28,366 $36,135 27.4%
TOTAL 2,030 1,881 1,688 (10.3%) $122,204 $69,614 $84,477 21.4%
YTD
North America 4,204 4,626 3,967 (14.2%) $387,458 $284,832 $201,455 (29.3%)
Latin America 644 552 406 (26.4%) $56,063 $36,704 $36,005 (1.9%)
Europe 5,562 5,394 3,967 (26.5%) $496,273 $401,436 $208,421 (48.1%)
Africa / Middle East 502 553 412 (25.5%) $43,693 $36,533 $24,159 (33.9%)
Asia Pacific 10,937 10,624 9,242 (13.0%) $393,639 $332,594 $289,222 (13.0%)
TOTAL 21,849 21,749 17,994 (17.3%) $1,377,126 $1,092,098 $759,263 (30.5%)
LTM
North America 4,204 4,626 3,967 (14.2%) $387,458 $284,832 $201,455 (29.3%)
Latin America 644 552 406 (26.4%) $56,063 $36,704 $36,005 (1.9%)
Europe 5,562 5,394 3,967 (26.5%) $496,273 $401,436 $208,421 (48.1%)
Africa / Middle East 502 553 412 (25.5%) $43,693 $36,533 $24,159 (33.9%)
Asia Pacific 10,937 10,624 9,242 (13.0%) $393,639 $332,594 $289,222 (13.0%)
TOTAL 21,849 21,749 17,994 (17.3%) $1,377,126 $1,092,098 $759,263 (30.5%)
Global Activity (cont'd)
Global Activity (cont'd) Annual Transactions
Global M&A Activity

Undisclosed Middle Market >$750M Deal Value
Deal Value
Number of Deals ($ in billions)
45,000 42,069 $4,500
41,011
40,000 $4,000
36,235 35,227
35,000 $3,500
27,301 30,791 30,929
30,000 $3,000
26,647 25,907
22,898 24,931
25,000 22,814 $2,500
20,000 $2,000
15,000 $1,500
10,000 $1,000
5,000 $500
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 405 563 645 340 296 293 439 580 800 1,024 600 401
Middle Market 11,859 12,932 15,897 13,015 12,421 11,947 13,789 16,795 18,891 21,851 21,750 17,995
Undisclosed 10,634 13,806 14,249 13,292 12,214 10,574 11,679 13,554 16,544 19,194 18,661 16,831
Deal Value $2,222 $3,060 $3,032 $1,572 $1,239 $1,356 $1,945 $2,755 $3,633 $4,273 $2,694 $2,024
U.S. M&A Activity
U.S. M&A Activity Transaction Detail
Announced U.S. M&A activity in December totaled 831 transactions, a decline of just 2.6% compared
with the corresponding period last year, although it was the third-highest monthly total for the year and
well above the monthly average of 756 transactions.
The dollar volume of transactions totaled $117.0 billion, the highest monthly total since July 2008. This
total was significantly higher than the $35.8 billion last year, and nearly double the monthly average of
$66.6 billion.
Middle-market activity for the month was also relatively strong, despite a modest 4.6% decline
compared with the prior-year period. There were 372 disclosed middle-market transactions, compared
with the monthly average of 334. Middle-market dollar volume rose 29.8%, to $24.1 billion, and was
significantly higher than the monthly average of $18.8 billion.
For the full year, the total number of U.S. transactions was 9,054, a decline of 20.3% and the lowest
total since 2003. Despite a sharp increase in the last three months, the full-year dollar volume totaled
just $880.1 billion, also the lowest total since 2003.
Full-year middle-market totals were down 15.4% for transactions and 34.9% for dollar volume.
U.S. M&A Activity Detail

% Chg. % Chg.
2007 2008 2009 '09 vs. '08 2007 2008 2009 '09 vs. '08
DECEMBER
< $50M 220 302 271 (10.3%) $3,483 $4,402 $3,272 (25.7%)
$50M-$250M 106 72 75 4.2% $12,683 $8,195 $9,191 12.2%
$250M-$750M 49 16 26 62.5% $21,742 $5,949 $11,612 95.2%
Total Middle-Market 375 390 372 (4.6%) $37,908 $18,546 $24,076 29.8%
Monthly Average 368 392 334 (14.7%) $39,055 $31,281 $18,844 (39.8%)
> 750M 40 11 17 54.5% $104,573 $17,302 $92,949 437.2%
Undisclosed 608 452 442 (2.2%) – – – –
Total Deals 1,023 853 831 (2.6%) $142,481 $35,848 $117,025 226.5%
Monthly Average 1,075 961 756 (21.3%) $147,913 $99,548 $66,577 (33.1%)
YTD
< $50M 2,522 3,099 2,970 (4.2%) $41,163 $45,247 $37,021 (18.2%)
$50M-$250M 1,328 1,193 756 (36.6%) $153,975 $133,971 $85,943 (35.8%)
$250M-$750M 626 423 264 (37.6%) $269,783 $176,786 $108,697 (38.5%)
Total Middle-Market 4,476 4,715 3,990 (15.4%) $464,922 $356,004 $231,661 (34.9%)
> 750M 462 230 157 (31.7%) $1,288,675 $731,941 $648,443 (11.4%)
Undisclosed 8,271 6,415 4,907 (23.5%) – – – –
Total Deals 13,209 11,360 9,054 (20.3%) $1,753,597 $1,087,945 $880,104 (19.1%)
LTM
< $50M 2,522 3,099 2,970 (4.2%) $41,163 $45,247 $37,021 (18.2%)
$50M-$250M 1,328 1,193 756 (36.6%) $153,975 $133,971 $85,943 (35.8%)
$250M-$750M 626 423 264 (37.6%) $269,783 $176,786 $108,697 (38.5%)
> 750M 462 230 157 (31.7%) $1,288,675 $731,941 $648,443 (11.4%)
Undisclosed 8,271 6,415 4,907 (23.5%) – – – –
Total Deals 13,209 11,360 9,054 (20.3%) $1,753,597 $1,087,945 $880,104 (19.1%)
U.S. M&A Activity (cont'd)
U.S. M&A Activity (cont'd) Annual Activity
U.S. M&A Activity

Number of Deals Deal Value

($ in billions)
15,000 $2,400
13,099 12,730 13,209
12,793 12,357
11,360
10,091 10,075 $1,800
9,929
10,000 9,054
8,948 8,791
$1,200
5,000
$600
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 265 252 327 190 128 146 233 281 364 462 230 157
Middle Market 6,399 5,351 6,791 4,624 4,019 4,237 4,533 4,465 4,522 4,476 4,715 3,990
Undisclosed 6,435 7,127 5,675 5,277 4,801 4,408 5,163 5,329 7,471 8,271 6,415 4,907
Deal Value $1,583 $1,719 $1,608 $871 $569 $688 $995 $1,300 $1,657 $1,754 $1,088 $880
U.S. Middle-Market M&A Activity

<$50M $50-250M $250-750M Deal Value
Number of Deals Deal Value

($ in billions)
7,000 6,399 6,791 $600
6,000 5,351
$500
5,000 4,624 4,533 4,522 4,715

4,465 4,476
4,237 $400
4,019 3,990
4,000
$300
3,000
$200
2,000
1,000 $100
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
$250-750M 429 527 514 298 291 315 409 427 535 626 423 264
$50-250M 1,446 1,426 1,588 1,010 897 1,071 1,226 1,276 1,294 1,328 1,193 756
<$50M 4,524 3,398 4,689 3,316 2,831 2,851 2,898 2,762 2,693 2,522 3,099 2,970
Deal Value $403 $441 $463 $280 $259 $293 $354 $366 $419 $465 $356 $232
.
U.S. M&A Activity (cont'd) Valuation Multiples
Overall, acquisition multiples as measured by enterprise value/EBITDA remain well below their 2008
levels, reflecting the uncertain economic outlook, reduced corporate profits, tight credit markets, volatile
equity markets, and reduced competition between strategic and financial buyers.
The one-week and four-week acquisition premiums paid for public companies have reached their
highest levels in more than a decade. However, given the recent sharp rebound in equity prices, we
believe that these premiums will likely begin to trend lower.
U.S. EV/EBITDA Valuation Multiples(1)

12.0x Middle Market Overall Market
9.0x
6.0x
3.0x
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Middle Market 9.2x 8.0x 7.4x 6.9x 8.2x 7.4x 8.5x 10.6x 9.6x 9.2x 8.2x 7.1x
Overall Market 9.6x 8.5x 7.8x 7.3x 8.0x 8.0x 9.0x 10.4x 10.3x 10.4x 9.3x 7.9x
(1) Effective with the July 2009 issue, we revised our parameters to exclude transactions in the financial institutions sector. All periods have
been recalculated and the current results are not comparable to those published prior to July 2009.
U.S. EV/EBITDA Middle-Market Valuation Multiples(1)

< $50M $50M-$250M $250M-$750M
12.0x
9.0x
6.0x
3.0x
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
< $50M 8.0x 7.8x 7.0x 6.0x 7.2x 8.3x 8.0x 7.9x 10.2x 7.8x 6.0x 5.3x
$50M-$250M 9.9x 8.1x 7.4x 7.8x 7.7x 6.7x 8.2x 11.1x 9.0x 9.3x 10.6x 7.7x
$250M-$750M 10.9x 8.5x 8.0x 7.2x 9.6x 7.9x 9.1x 11.2x 9.5x 9.3x 10.1x 8.1x
(1) Effective with the July 2009 issue, we revised our parameters to exclude transactions in the financial institutions sector. All periods have
been recalculated and the current results are not comparable to those published prior to July 2009.
Median Acquisition Premiums

1-Week Premium 4-Week Premium
60.0%
40.0%
20.0%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1-Week Premium 38.4% 38.9% 41.2% 47.1% 45.0% 35.3% 26.4% 32.1% 27.6% 29.4% 38.0% 46.0%
4-Week Premium 42.3% 47.0% 49.0% 52.8% 47.5% 41.8% 29.8% 36.0% 30.4% 31.5% 43.0% 55.8%
U.S. M&A Activity (cont'd) Private-Equity Transaction Analysis

For the month, there were just 88 U.S. related private-equity transactions, more than 25% below the
year-ago period and also well below the monthly average of 112.
The dollar value of $8.0 billion was more than 50% above the comparable period last year although it
was still less than the trailing-12-month average of $10.8 billion.
For the full year, there were a total of 1,318 announced transactions, 29.4% less than the
corresponding period last year. The dollar volume has experienced an even more dramatic decline,
down 37.3% year-to-date compared with the corresponding period last year, and down a staggering
79.4% compared with 2007.
U.S. Private-Equity Activity Detail

% Chg. % Chg.
2007 2008 2009 '09 vs. '08 2007 2008 2009 '09 vs. '08
DECEMBER
Middle-Market 76 61 52 (14.8%) $11,325 $3,837 $5,718 49.0%
Monthly Average 74 70 57 (18.4%) $11,821 $8,130 $4,487 (44.8%)
> 750M 16 1 1 0.0% $35,710 $1,300 $2,314 78.0%
Undisclosed 90 57 35 (38.6%) – – – –
Total Deals 182 119 88 (26.1%) $47,034 $5,137 $8,032 56.4%
Monthly Average 207 161 112 (30.1%) $54,807 $21,204 $10,865 (48.8%)
YTD
Middle-Market 884 829 680 (18.0%) $138,848 $90,070 $55,725 (38.1%)
> 750M 161 50 35 (30.0%) $507,607 $122,484 $77,550 (36.7%)
Undisclosed 1,454 989 603 (39.0%) – – – –
Total Deals 2,499 1,868 1,318 (29.4%) $646,455 $212,553 $133,275 (37.3%)
LTM
Middle-Market 884 829 680 (18.0%) $138,848 $90,070 $55,725 (38.1%)
> 750M 161 50 35 (30.0%) $507,607 $122,484 $77,550 (36.7%)
Undisclosed 1,454 989 603 (39.0%) – – – –
Total Deals 2,499 1,868 1,318 (29.4%) $646,455 $212,553 $133,275 (37.3%)
U.S. Private-Equity Activity

Deal Value
2,433 2,499
2,500 $700
2,089
1,884 1,868 $600
2,000
$500
1,500 1,314 1,384 1,318
$400
1,073 1,067 1,125
1,000 $300
718
$200
500
$100
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 24 32 29 21 26 34 74 92 119 161 50 35
Middle Market 367 548 775 558 618 715 1,015 989 1,093 884 829 680
Undisclosed 327 493 510 488 481 635 795 1,008 1,221 1,454 989 603
Deal Value $93 $130 $134 $87 $98 $133 $252 $332 $578 $646 $213 $133
U.S. M&A Activity (cont'd) Private-Equity Transaction Analysis (cont’d)
Just two industries registered an increase in the year-over-year number of transactions, while nine
posted an increase in dollar volume.
The computer and electronics sector remained the most active sector for private-equity investors, with
336 announced transactions for the year. This total was more than the next two sectors combined —
healthcare (157 deals) and professional services (156 deals). These three industries alone represented
approximately 50% of the total.
Based on dollar volume, the finance sector was the most active, with $30.8 billion in announced dollar
volume, accounting for almost 25% of the total. Computers and electronics ended second at $27.8
billion, with healthcare a distant third.
Private Equity Activity by Target Sector

NUMBER OF DEALS DOLLAR VOLUME
2006 2007 2008 2009 2006 2007 2008 2009
Aerospace 17 19 11 6 $4,947 $7,769 $2,555 $1,050
Agribusiness 9 7 7 5 – $75 $150 $202
Auto/Truck 57 55 46 38 $5,266 $19,588 $746 $1,239
Chemicals 61 83 55 29 $14,190 $18,936 $5,357 $1,042
Computers & Electronics 495 413 390 336 $56,671 $44,054 $22,953 $27,821
Construction/Building 92 85 77 42 $10,229 $15,784 $3,788 $796
Consumer Products 94 139 68 32 $9,911 $15,922 $5,947 $2,685
Defense 3 7 4 1 $410 $905 $25 $214
Dining & Lodging 49 50 30 16 $19,024 $39,553 $3,710 $1,014
Finance 83 129 97 70 $20,757 $77,639 $33,303 $30,823
Food & Beverage 64 58 55 32 $9,952 $16,277 $8,380 $7,988
Forestry & Paper 23 28 14 5 $5,136 $7,474 $750 $15
Government 2 4 2 – $8 – $8 –
Healthcare 243 231 180 157 $81,642 $48,230 $15,431 $14,199
Holding Companies 18 25 16 5 $4,172 $6,801 $1,857 $65
Insurance 41 60 42 22 $4,775 $13,572 $3,106 $3,617
Leisure & Recreation 38 41 27 30 $33,925 $7,484 $2,212 $6,703
Machinery 70 81 53 32 $5,374 $4,762 $1,791 $2,107
Metal & Steel 61 58 45 25 $8,124 $6,999 $3,027 $689
Mining 11 15 11 5 $1,673 $2,630 $911 $14
Oil & Gas 74 59 62 38 $12,584 $19,089 $8,193 $4,186
Professional Services 327 350 248 156 $29,768 $41,555 $16,103 $5,117
Publishing 79 76 35 39 $8,921 $7,247 $1,431 $2,194
Real Estate/Property 38 43 45 20 $77,603 $46,515 $4,937 $3,831
Retail 73 95 66 48 $37,620 $27,329 $4,527 $4,125
Telecommunications 150 118 68 58 $64,281 $66,592 $37,522 $5,427
Textile 26 28 17 5 $825 $6,130 $1,206 $228
Transportation 73 85 55 29 $20,877 $14,720 $3,230 $1,099
Utility & Energy 62 57 42 37 $29,494 $62,827 $19,397 $4,784
TOTAL 2,433 2,499 1,868 1,318 $578,157 $646,455 $212,553 $133,275
U.S. M&A Activity (cont'd) Transaction Breakdown

Private companies have continued to take advantage of the market turmoil and increased their
acquisition activity relative to the other market participants. Private companies now represent 47.3% of
acquirers, up from 38.3% in 2008. This increase has come primarily at the expense of public
companies, although private-equity firms and foreign acquirers have also seen their share of the total
decline compared with 2008 results.
Private companies continue to account for the majority (61.7%) of all transaction targets, although their
share has declined modestly from 2008. Both private-equity exits and public companies have also seen
a decline as a percent of the total, while the divestiture activity has increased dramatically over the past
two years.
U.S. Middle-Market M&A Activity by Acquirer(1)

Percent of Deals Private Public Private Equity Foreign
75.0%
50.0%
25.0%
0.0%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Private 16.6% 23.1% 32.7% 28.3% 29.4% 32.4% 29.2% 27.7% 37.3% 38.9% 38.3% 47.3%
Public 71.5% 59.6% 46.5% 48.9% 46.8% 43.6% 44.7% 40.3% 32.1% 30.2% 30.2% 24.9%
Private Equity 5.0% 7.9% 8.9% 8.1% 10.4% 13.8% 15.2% 17.5% 16.9% 15.7% 13.6% 11.6%
Foreign 6.9% 9.4% 11.9% 14.7% 13.5% 10.2% 11.0% 14.5% 13.7% 15.2% 17.9% 16.2%
(1) As of January 2009, we have adjusted the data to include transactions with no disclosed value, rather than just middle-market deals
U.S. Middle-Market M&A Activity by Target(1)

Percent Deals Private Public Private Equity Divestiture
75.0%
50.0%
25.0%
0.0%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Private 59.3% 61.4% 63.9% 49.6% 48.9% 42.9% 52.4% 64.1% 67.3% 69.4% 64.6% 61.7%
Public 7.1% 9.4% 8.8% 7.4% 6.2% 6.2% 4.2% 3.9% 3.3% 3.7% 4.4% 4.1%
Private Equity 1.0% 1.3% 2.1% 3.4% 3.8% 5.3% 6.5% 6.8% 5.6% 5.6% 4.4% 3.7%
Divestiture 32.7% 28.0% 25.1% 39.6% 41.1% 45.6% 37.0% 25.2% 23.8% 21.4% 26.6% 30.6%
(1) As of January 2009, we have adjusted the data to include transactions with no disclosed value, rather than just middle-market deals
U.S. M&A Activity (cont'd) Transaction Breakdown (cont’d)
Distressed U.S. M&A Activity

Deal Value
400 $100
371
350 325 331

$80
300
250
$60
194
200
163
$40
150
109
100 74
66 $20
35 42 43 47
50
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 2 5 1 10 10 13 13 2 2 5 10 17
Middle Market 23 37 25 101 232 247 134 26 22 33 47 164
Undisclosed 10 24 16 52 83 71 47 15 23 36 52 190
Deal Value $7.6 $16.5 $4.0 $31.6 $49.6 $46.1 $30.4 $8.8 $6.0 $18.7 $40.8 $73.7
U.S. Take Private Transaction Activity

Middle Market >750M Deal Value
Deal Value
90 87 $300
81 78
77
$250
65 65
57 58
60 $200
51
45 47
43
$150
32
30 $100
$50
0 $0
Number 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>750M 7 3 8 3 2 4 3 12 15 34 41 6 5
Middle Market 50 48 73 62 63 54 74 33 28 44 46 26 42
Deal Value $19.3 $12.1 $29.4 $14.1 $7.3 $10.1 $10.8 $33.2 $55.1 $240.8 $274.6 $11.4 $16.9
U.S. M&A Activity (cont'd) Industry Breakdown
For the overall market, just 1 (healthcare) of the 14 industry sectors we track showed an increase in the
year-over-year number of deals. In terms of dollar volume, just 4 segments experienced a year-over-
year increase, while just 4 of the 14 segments (an improvement from 11 just three months ago) ended
down in excess of 50% compared with 2008.
In the middle market, the picture is similar, where just three industries saw an increased number of
transactions compared with last year. In terms of dollar volume, just one industry saw an increase in
dollar volume, while four ended down more than 50% (compared with six two months ago).
Transaction Activity by Target Sector

2006 2007 2008 2009
TRANSACTIONS Mid-Mkt Total Mid-Mkt Total Mid-Mkt Total Mid-Mkt Total
Business Services 362 1,711 344 1,750 361 1,298 330 1,027
Computers & Electronics 701 1,800 619 1,731 726 1,671 823 1,640
Construction/Building 82 407 79 398 73 312 45 202
Consumer Products 74 291 111 455 81 236 50 152
Consumer Services 240 695 177 667 151 422 158 349
Energy & Power 290 684 306 729 394 706 335 613
Financial 279 889 271 1,007 254 771 179 664
Food & Beverage 57 214 41 203 47 172 36 123
Healthcare 431 963 350 935 439 881 521 926
Industrial Products 114 499 118 499 129 419 95 267
Materials 162 533 188 647 219 575 172 408
Real Estate/Property 280 548 240 560 201 425 137 263
Telecommunications 217 489 159 451 161 342 142 299
Transportation 69 222 57 250 56 197 29 107
Other 60 223 60 223 65 179 26 103
TOTAL 3,418 10,168 3,120 10,505 3,357 8,606 3,078 7,143
$ VOLUME (B)
Business Services $25,528 $61,236 $26,028 $91,436 $19,402 $31,466 $12,158 $19,124
Computers & Electronics $43,862 $115,675 $42,451 $119,923 $29,288 $74,732 $24,097 $71,662
Construction/Building $8,588 $31,685 $7,630 $45,398 $5,464 $8,666 $2,492 $5,787
Consumer Products $7,311 $17,554 $7,514 $29,011 $5,148 $21,282 $1,839 $7,226
Consumer Services $27,212 $130,605 $21,491 $85,664 $11,385 $24,311 $10,968 $26,960
Energy & Power $34,314 $160,323 $44,072 $210,626 $44,402 $102,001 $27,291 $95,353
Financial $32,248 $174,809 $33,110 $210,613 $24,786 $145,561 $16,957 $92,264
Food & Beverage $7,773 $11,854 $4,444 $30,007 $4,114 $98,723 $2,922 $19,578
Healthcare $35,561 $177,872 $32,385 $140,861 $28,167 $137,719 $25,203 $173,852
Industrial Products $9,712 $25,278 $14,064 $45,482 $9,371 $11,321 $5,916 $17,956
Materials $19,482 $90,651 $23,026 $100,655 $14,998 $58,662 $8,612 $22,462
Real Estate/Property $32,163 $164,892 $36,752 $139,495 $21,167 $33,404 $8,763 $12,388
Telecommunications $18,185 $204,510 $18,633 $83,260 $10,345 $82,439 $11,179 $75,902
Transportation $7,626 $22,135 $8,938 $31,248 $5,010 $11,726 $1,802 $37,716
Other $4,622 $9,219 $5,419 $18,720 $5,670 $6,492 $1,245 $3,795
TOTAL $314,187 $1,398,297 $325,958 $1,382,401 $238,717 $848,505 $161,444 $682,026
ENT. VALUE/ EBITDA

Business Services 11.8x 12.1x 11.2x 13.3x 8.9x 10.8x 10.9x 10.9x
Computers & Electronics 14.6x 15.1x 14.7x 15.3x 13.5x 13.3x 11.5x 11.9x
Construction/Building 8.7x 10.7x 8.8x 10.2x 4.9x 6.4x NA NA
Consumer Products 11.0x 10.4x 10.1x 11.7x NA 10.9x 9.8x 9.8x
Consumer Services 12.4x 13.0x 11.2x 13.4x 10.9x 11.3x 10.6x 10.5x
Energy & Power 11.9x 11.7x 8.0x 9.9x 12.1x 12.9x 8.6x 8.8x
Financial 10.6x 10.4x 10.2x 10.8x 9.5x 9.5x 8.7x 8.7x
Food & Beverage 7.7x 7.6x 16.0x 16.7x 4.9x 13.5x 9.2x 9.2x
Healthcare 12.8x 14.9x 10.9x 13.9x 12.9x 16.7x 10.2x 9.9x
Industrial Products 9.1x 11.6x 13.3x 11.6x 11.9x 11.9x 9.2x 11.4x
Materials 9.5x 10.7x 9.7x 9.9x 10.7x 12.1x 6.4x 6.4x
Real Estate/Property 11.4x 16.1x 12.1x 14.2x 20.0x 17.4x 5.7x 5.7x
Telecommunications 13.1x 13.9x 13.3x 13.7x 18.0x 12.5x 11.0x 11.0x
Transportation 13.4x 13.2x 11.5x 12.4x NA 7.5x 8.0x 8.0x
U.S. M&A Activity (cont'd) Cross-Border Transaction Analysis
Total U.S. cross-border activity and middle-market cross-border activity continue to decline moderately
from prior levels.
For the overall market, the LTM transaction breakdown is about 60%/40% in favor of outbound
transactions, similar to the totals for all of 2006 and 2007.
In the middle market, the LTM transaction breakdown favors the outbound transactions 60% to 40%.
For middle-market and undisclosed transactions, the most actively targeted U.S. industries by foreign
buyers are computers/electronics, healthcare, and professional services.
The most active foreign buyers making acquisitions in the United States remain the same: Canada, the
United Kingdom, and Japan.
The top industries outside the United States targeted by U.S. buyers remain the same:
computer/electronics, professional services, and healthcare.
The top country targeted by U.S. buyers was Canada, followed by the United Kingdom and China.
U.S. Middle-Market Cross-Border M&A by Number of Deals

Outbound Inbound Inbound Deal Value Outbound Deal Value
Deal Value
2,500 $120
2,088 2,147
1,927 $100
2,000 1,846
1,703
1,615
$80
1,448 1,421 1,443 1,4071,417
1,500
1,320 1,268
1,081 1,021
1,119
1,018 1,053 1,038 $60
1,000 867 851 791
680
$40
622
500
$20
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
Inbound
Middle Market 383 469 684 572 442 365 434 526 517 615 735 547
Undisclosed 297 398 397 449 409 257 357 527 751 828 672 491
Value $37.2 $46.8 $65.2 $38.5 $30.2 $24.3 $39.9 $44.2 $57.0 $65.8 $50.2 $37.8
Outbound
Middle Market 757 844 871 676 557 525 699 748 817 1,070 1,094 700
Undisclosed 946 1,002 1,056 772 562 493 621 673 798 1,018 1,053 717
Value $55.6 $77.5 $71.7 $49.3 $36.2 $39.0 $59.4 $61.2 $71.7 $105.1 $91.4 $48.4
U.S. M&A Activity (cont'd) Cross-Border Transaction Analysis (cont’d)
U.S. Cross-Border M&A — Number of Transactions

INBOUND OUTBOUND TOTAL
2007 2008 2009 2007 2008 2009 2007 2008 2009
Middle Market 615 735 547 1,070 1,094 700 1,685 1,829 1,247
> $750M 93 53 23 64 38 25 157 91 48
Undisclosed 828 672 491 1,018 1,053 717 1,846 1,725 1,208
Total 1,536 1,460 1,061 2,152 2,185 1,442 3,688 3,645 2,503
U.S. Cross-Border M&A — Transaction Value

INBOUND OUTBOUND TOTAL
2007 2008 2009 2007 2008 2009 2007 2008 2009
Middle Market $65,770 $50,248 $37,778 $105,149 $91,406 $48,392 $170,919 $141,654 $86,171
> $750M $297,322 $233,161 $51,215 $149,044 $86,460 $66,391 $446,366 $319,621 $117,607
Undisclosed – – – – – – – – –
Total $363,093 $283,409 $88,994 $254,193 $177,865 $114,783 $617,286 $461,275 $203,777
U.S. Cross-Border M&A Transactions — 2009

INBOUND to U.S. OUTBOUND from U.S.
Target Industry Deals Acquiror Country Deals Target Industry Deals Acquiror Country Deals
Computers & Electronics 191 Canada 289 Computers & Electronics 279 Canada 247
Healthcare 139 United Kingdom 151 Professional Services 172 United Kingdom 179
Professional Services 90 Japan 82 Healthcare 121 China 120
Mining 88 Australia 77 Mining 88 Germany 83
Oil & Gas 85 Switzerland 44 Finance 85 Japan 76
U.S. Cross-Border M&A Transactions — 2008

INBOUND to U.S. OUTBOUND from U.S.
Target Industry Deals Acquiror Country Deals Target Industry Deals Acquiror Country Deals
Computers & Electronics 262 Canada 382 Computers & Electronics 417 Canada 304
Healthcare 145 United Kingdom 184 Professional Services 229 United Kingdom 267
Professional Services 140 Australia 88 Finance 158 China 213
Mining 109 Japan 80 Healthcare 122 Japan 163
Oil & Gas 103 Germany 74 Real Estate/Property 102 India 141
U.S. Financing Markets
U.S. Financing Markets Debt Capital Markets
The average debt multiple for LBO loans continues to decline, with total debt/EBITDA for transactions
by companies below $50 million of EBITDA currently at 3.4x, down from 4.4x at the beginning of the
year and 5.3x at the beginning of 2008.
For companies with more than $50 million in EBITDA, the leverage multiples have ticked up slightly,
and now stand at 4.8x total debt and 3.9x senior debt. This compares with total debt of 4.0x and senior
debt of 3.4x at the beginning of the year.
The average total equity contribution for all transactions was 50.6% for all transactions, which is at the
top end of the historical range.
Average Pro Forma Adjusted Credit Statistics of Middle-Market LBO Loans

(Issuers with EBITDA of Less Than $50M)
Total Debt/EBITDA Senior Debt/EBITDA
7.0x 7.0x
6.0x 6.0x
5.3x
5.0x 4.9x
5.0x 5.0x
4.4x 4.4x
3.8x 4.0x 4.1x 3.4x
3.9x 4.8x
3.6x 4.6x
4.0x 3.5x 4.4x 4.0x
3.9x
3.0x 3.4x 3.0x
3.2x 3.3x 3.3x
3.1x 3.0x 3.1x
2.4x
2.0x 2.0x
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
(1) Total Equity equals common, preferred and rollover equity.

Source: S&P’s Leveraged Lending Review.
Average Pro Forma Adjusted Credit Statistics of Middle-Market LBO Loans

(Issuers with EBITDA of More Than $50M)
Total Debt/EBITDA Senior Debt/EBITDA
7.0x 5.8x 7.0x
5.7x 5.6x
6.0x 6.0x
4.9x
5.0x 5.8x 4.8x
4.5x 4.6x
5.0x 5.0x
4.1x 5.2x
3.9x 4.0x
3.8x
4.0x 3.7x 4.0x
4.4x
3.0x 3.4x 3.0x

3.2x 3.3x
3.2x 3.9x
2.8x 2.9x
2.8x
2.0x 2.0x
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
U.S. Financing Markets (Cont'd)
U.S. Financing Markets (Cont'd)
Average Total Equity Contribution For LBO Transactions

Less than $50 million EBITDA More than $50 million EBITDA
60.0%
(1)
50.6%
50.0%
45.3%
40.8% 41.5%
37.9% 39.7%
40.0% 37.0%
36.1% 36.3% 36.7% 35.4% 34.2%
34.2%
32.4% 31.5% 32.3%
28.9% 29.9% 30.0% 31.0% 31.5%
29.6% 29.9%
30.0%
26.8%
25.2%
20.0%
10.0%
0.0%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
(1) 2009 data represents all transactions as there were too few transactions to segment by size. The comparable number in 2008 for all
transactions was 42.6%
Total Equity equals common, preferred and rollover equity.
U.S. Financing Markets (cont'd)
U.S. Financing Markets (cont'd) Equity Capital Markets
IPO Pricings by Sector — Last 4 Quarters: 45 Total Deals

Business
Services
Q1 2009
6
2 Technology
Q2 2009 19
7 Healthcare
13
Q4 2009
26
Other (Utility/
Q3 2009 Energy/Gas)
10 Industrial
5 11
Consumer Financial
10 Services
8
IPO Filings by Sector — Last 4 Quarters: 72 Total Deals

Q1 2009 Financial Other
2 Services 3
Q2 2009 3 Technology
4 12
Healthcare
7
Q3 2009
24
Q4 2009
42
Consumer
Industrial 8
9 Business
Services
3
IPO Backlog(1)
Number of Deals Backlog Pricings Filings Withdrawn
140 124 20
117 116
120
101
15
100 90
80
80 69 58
58 63 61 63 65
47 10
55 52
60 46
44
34 39
40 26
21 9 7 5
17
20 13 11
0 0
11/07
12/07
01/08
02/08
03/08
04/08
05/08
06/08
07/08
08/08
09/08
10/08
11/08
12/08
01/09
02/09
03/09
04/09
05/09
06/09
07/09
08/09
09/09
10/09
11/09
12/09
01/10
Pricings 19 12 4 4 3 2 4 4 2 1 0 0 1 0 0 1 1 2 3 2 0 3 8 12 10 4 0
Filings 16 16 15 3 8 10 16 9 10 6 3 0 3 3 2 0 0 1 0 3 6 9 9 14 13 15 1
Withdrawn 16 8 12 9 7 4 5 5 1 5 6 12 8 11 2 3 4 8 2 2 2 2 1 3 5 4 0
(1) Backlog defined as IPOs filed or revised within the last 180 days, excluding SPACs, REITs and Rule 144A Offerings.
European M&A Activity
European M&A Activity Transaction Detail
European M&A activity has not rebounded quite as much as it has in the United States.
The total number of announced deals for the month was 877, a 24.1% decline compared with the
corresponding period last year, and well below the trailing-12-month monthly average of 1,213.
The total dollar volume for the month jumped to $88.7 billion, an increase of 23.7% compared with the
corresponding period last year and significantly above the trailing-12-month monthly average of $64.7
billion.
European middle-market activity was just 380 announced deals, down 18.1% compared with the
corresponding period last year, while the dollar volume of $30.9 billion represented a 28.4% increase.
European M&A Activity Detail

% Change % Change
2007 2008 2009 '09 vs. '08 2007 2008 2009 '09 vs. '08
DECEMBER
< $50M 347 355 253 (28.7%) $5,234 $4,583 $3,793 (17.2%)
$50M-$250M 173 86 88 2.3% $20,783 $10,323 $9,851 (4.6%)
$250M-$750M 79 23 39 69.6% $33,029 $9,199 $17,304 88.1%
Total Middle-Market 599 464 380 (18.1%) $59,046 $24,104 $30,949 28.4%
Monthly Average 545 553 406 (26.5%) $50,220 $43,889 $22,399 (49.0%)
> 750M 55 19 22 15.8% $136,192 $47,623 $57,785 21.3%
Undisclosed 720 672 475 (29.3%) – – – –
Total Deals 1,374 1,155 877 (24.1%) $195,238 $71,727 $88,734 23.7%
Monthly Average 1,259 1,361 1,213 (10.9%) $189,083 $124,315 $64,711 (47.9%)
YTD
< $50M 3,991 4,367 3,580 (18.0%) $60,254 $57,842 $39,244 (32.2%)
$50M-$250M 1,848 1,557 903 (42.0%) $213,614 $182,745 $102,471 (43.9%)
$250M-$750M 789 577 309 (46.4%) $335,200 $251,139 $133,919 (46.7%)
> 750M 538 337 186 (44.8%) $1,677,931 $876,550 $517,898 (40.9%)
Undisclosed 8,266 9,279 9,300 0.2% – – – –
Total Deals 15,432 16,117 14,278 (11.4%) $2,286,999 $1,368,275 $793,532 (42.0%)
LTM
< $50M 3,991 4,367 3,580 (18.0%) $60,254 $57,842 $39,244 (32.2%)
$50M-$250M 1,848 1,557 903 (42.0%) $213,614 $182,745 $102,471 (43.9%)
$250M-$750M 789 577 309 (46.4%) $335,200 $251,139 $133,919 (46.7%)
> 750M 538 337 186 (44.8%) $1,677,931 $876,550 $517,898 (40.9%)
Undisclosed 8,266 9,279 9,300 0.2% – – – –
Total Deals 15,432 16,117 14,278 (11.4%) $2,286,999 $1,368,275 $793,532 (42.0%)
European M&A Activity (cont'd)
European M&A Activity (cont'd) Annual Activity
European M&A Activity

Deal Value
20,000 $2,400
16,117
15,432
14,727 14,278
15,000 13,723 $1,800
13,118 12,806
11,757
11,485
10,616
10,015
10,000 $1,200
8,348
5,000 $600
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 163 300 355 163 172 149 199 288 391 538 337 186
Middle Market 4,143 5,406 6,580 5,720 5,143 4,651 4,929 5,927 6,215 6,628 6,501 4,792
Undisclosed 4,042 6,051 7,792 7,235 6,170 5,215 5,488 6,591 7,117 8,266 9,279 9,300
Deal Value $772 $1,499 $1,535 $679 $638 $625 $842 $1,221 $1,702 $2,287 $1,368 $794
European Middle-Market M&A Activity

<$50M $50-250M $250-750M Deal Value
Deal Value
8,000 $800
7,000 6,580 6,628 6,501

6,215
5,720 5,927
6,000 5,406 $600
5,143
4,929 4,798
5,000 4,651
4,143
4,000 $400
3,000
2,000 $200
1,000
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
$250-750M 279 377 441 306 294 290 398 492 625 789 577 309
$50-250M 863 1,093 1,202 894 870 928 1,155 1,388 1,568 1,848 1,557 903
<$50M 3,001 3,936 4,937 4,520 3,979 3,433 3,376 4,047 4,022 3,991 4,367 3,586
Deal Value $251 $339 $384 $275 $265 $267 $349 $420 $506 $609 $491 $276
European M&A Activity (cont'd) Valuation Multiples
The median enterprise value/EBITDA multiple for all European transactions continues to decline,
coming in at 6.6x for the year, down from 9.4x for all of 2008 and 11.0x for 2007.
For middle-market deals over the past 12 months, the median enterprise value/EBITDA multiple has
declined to 6.6x, from 8.6x for 2008.
One-week and four-week acquisition premiums, recently at record levels, have begun to decline as a
result of the sharp rebound in equity valuations.
European EV/EBITDA Valuation Multiples

15.0x
Middle Market Overall Market
10.0x
5.0x
0.0x
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Middle Market 9.9x 8.8x 8.7x 8.6x 8.3x 8.6x 8.7x 9.7x 10.3x 10.0x 8.6x 6.6x
Overall Market 10.2x 9.0x 8.9x 8.9x 8.5x 8.7x 8.8x 10.1x 11.0x 11.0x 9.4x 6.6x
European EV/EBITDA Middle-Market Valuation Multiples

15.0x < $50M $50M-$250M $250M-$750M
10.0x
5.0x
0.0x
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Size
< $50M 8.9x 8.2x 7.8x 7.9x 7.3x 7.8x 7.9x 8.2x 10.0x 8.9x 7.2x 7.2x
$50M-$250M 10.2x 8.8x 9.9x 9.4x 9.2x 8.7x 9.2x 10.5x 10.5x 11.6x 8.0x 6.4x
$250M-$750M 12.4x 10.9x 9.3x 9.4x 10.8x 10.3x 9.6x 11.8x 11.6x 9.7x 11.4x 6.6x
European Middle-Market Median Acquisition Premiums

40.0% 1-Week Premium 4-Week Premium
30.0%
20.0%
10.0%
0.0%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1-Week Premium 23.1% 23.6% 26.4% 23.3% 23.5% 17.0% 17.1% 15.9% 14.4% 19.0% 29.2% 22.1%
4-Week Premium 31.1% 30.0% 32.4% 26.3% 23.7% 21.8% 19.2% 20.8% 17.5% 22.5% 30.6% 27.1%
European M&A Activity (cont'd) Private-Equity Transaction Analysis
European private-equity activity is down substantially, mirroring the activity in the United States.
For the month, there were just 85 announced private-equity transactions, well below the 100
transactions in the corresponding period last year. For the full year, the number of transactions declined
39.4% to its lowest annual total since 1999.
The dollar volume for the month was $9.8 billion, bringing the full-year total to $114 billion. This was a
43.6% decline from the 2008 total and was the lowest amount since 2002.
European Private-Equity Activity
Number of Deals Undisclosed Middle Market >$750M Deal Value

2,368
2,500 2,141 2,144 $800
1,902
2,000 1,607 $600
1,401 1,379 1,298 1,386
1,500 985 1,152
$400
1,000 668
500 $200
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 12 22 29 21 31 38 61 90 102 150 70 35
Middle Market 440 572 794 753 730 723 845 985 900 972 791 493
Undisclosed 228 391 578 605 537 625 701 1,066 1,142 1,246 1,041 624
Deal Value $46 $76 $94 $76 $96 $132 $215 $281 $353 $446 $202 $114
Average Total Equity Contribution

60.0% 53.1%
50.0% 44.7%
37.4% 37.6% 38.6% 37.3%
40.0% 35.9% 35.9% 35.9% 33.7% 33.7% 33.6%
29.6%
30.0%
20.0%
10.0%
0.0%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
(1) Total Equity equals common, preferred and rollover equity.

Average Debt Multiples of LBO Loans

7.0x Senior Debt/EBITDA Non-Senior Debt/EBITDA 6.6x
5.8x 5.9x
6.0x 5.5x 5.6x 1.0x 5.3x
4.8x 5.1x
4.9x
5.0x 4.7x 4.7x 4.4x 4.4x 4.5x 4.7x 1.0x 1.2x 1.1x
1.0x 4.5x
0.4x 4.2x 4.2x 4.3x 4.1x 0.7x 1.2x 1.1x 4.0x
4.0x
4.0x 1.2x 0.9x 1.1x 1.1x
0.6x 0.8x 0.7x 0.7x 0.6x 1.0x 0.7x 0.6x 1.3x
3.0x 5.6x
4.4x 4.7x 4.9x
2.0x 4.3x 4.2x 4.5x 3.9x 4.2x
3.5x 3.6x 3.6x 3.5x 3.6x 3.4x 3.4x 3.4x 3.6x 3.6x 3.7x 3.4x3.2x
1.0x
0.0x
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Left Column – less than €50 million EBITDA Right Column – more than €50 million EBITDA
Emerging Markets M&A Activity
Emerging Markets M&A Activity
Latin American M&A Activity

Deal Value
1,500 $140
1,262
1,250 $120
1,152
$100
1,000 854 885 871
749 $80
750
625 618 565
576 $60
520
500 449
$40
250 $20
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 16 17 34 9 13 9 13 13 30 33 36 33
Middle Market 364 425 388 311 200 289 329 310 440 666 596 447
Undisclosed 245 412 327 298 236 222 234 242 415 563 520 391
Deal Value $71 $76 $94 $48 $38 $30 $59 $48 $130 $106 $111 $103
Asian M&A Activity

Deal Value
16,000 15,419 15,450 $900
14,000 13,259 $800

12,274
12,000 $700
9,856 $600
10,000
$500
8,000 7,074
5,858 $400
6,000 5,495 5,152 5,275
3,989 $300
4,000 2,527 $200
2,000 $100
0 $0
Number 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
of Deals
>$750M 26 58 73 51 50 47 86 105 158 196 137 124
Middle Market 1,555 2,521 3,429 3,247 3,778 3,588 5,058 7,149 9,052 11,563 11,318 9,822
Undisclosed 946 1,410 1,993 1,854 2,030 1,640 1,930 2,602 3,064 3,660 3,995 3,313
Deal Value $122 $305 $389 $254 $199 $226 $398 $523 $673 $832 $680 $655
Select William Blair & Company Transactions
Select William Blair & Company Transactions
CLOSE DEAL
DATE BLAIR CLIENT CLIENT DESCRIPTION TRANSACTION DESCRIPTION VALUE
12/29/09* PharmaForce, Inc. U.S.-based specialty injectable Sale to Luitpold Pharmaceuticals, a Daiichi- ND
pharmaceutical company offering a fully- Sankyo group company based in Shirley, NY,
integrated complement of sterile that manufactures and distributes over 65
manufacturing, development, and marketing pharmaceutical products.
capabilities.
12/18/09 AMR Research, Inc. A leading independent market research and Sale to Gartner, Inc. $63.0
advisory firm serving the global supply chain
organization and the related IT ecosystem
that supports it.
12/14/09* Monterey Gourmet Production, distribution, and marketing of Sale to Pulmuone U.S.A., Inc. $45.8
Foods, Inc. refrigerated gourmet food products.
12/2/09* Dutko Worldwide Multidisciplinary government affairs, Sale to Huntsworth plc, a global public $54.3
Holdings, Inc., (Lake strategy, and management consulting relations and healthcare communications group
Capital) company. based in London.
11/30/09 Ellicott Dredges Largest North American manufacturer of Markel Ventures, which owns and manages the ND
Enterprises, LLC dredges and the world leader in the investment activities of Markel Corporation, a
production of mid-sized portable cutter publicly traded insurance company that
suction dredges. markets and underwrites specialty insurance
products and programs to a variety of niche
markets.
10/26/09 Ellerbe Becket, Inc. An internationally recognized provider of Sale to AECOM Technology Corp. ND
architecture, engineering, and interior-
design services.
9/28/09 Auctionpay, Inc. Leading provider of fully integrated payment Sale to Global Payments, Inc., a provider of ND
(Appian Ventures, processing and software solutions that electronic payments transaction processing
Maveron Equity Partners) improve and enhance fundraising activities services.
for nonprofit organizations and schools.
9/24/09* EBEWE Pharma Austrian pharmaceutical company. Sale of company’s specialty generic injectables $1,300.00
Ges.m.b.H. Nfg.KG business to Sandoz, the generic
pharmaceutical division of Novartis.
9/10/09 Temcor, Inc. Aluminum geodesic domes design and Sale to CST Industries, Inc., the leading ND
(Solis Capital Partners) manufacturing. provider of steel tanks for water and
wastewater storage and treatment. The
company is owned by The Sterling Group.
9/01/09 Vcommerce Corporation SaaS enterprise e-commerce solutions for Sale to Channel Intelligence, a performance ND
online retail. marketing and services company and partner
company of Internet Capital Group and Aweida
Capital Management.
8/27/09* Schulerhilfe GmbH The leading provider of private tutoring Sale of Schulerhilfe GmbH, a subsidiary of ND
services to the German and Austrian Educate, Inc., to Paragon Partners GmbH, a
primary and secondary education markets. Munich-based private-equity firm.
8/21/09 Crownline Boats, Inc. Engages in the manufacture, marketing Sale to Leisure Properties, LLC. ND
and distribution of boats.
8/13/09* LEWA GmbH A global leader in the development, design, Sale to Nikkiso Co., Ltd, a publicly listed ND
(Deutsche Beteiligungs manufacture, and service of technologically company on the Tokyo Stock Exchange, and
AG and Quadriga Capital) advanced, highly engineered process and which operates through four business units:
metering pumps and systems. Fluid Technologies, Industrial Solutions,
Composite Technologies, and Medical
Equipment.
8/10/09 Maximum Performance Manufactures a line of remote HVAC and Sale of Lime Energy Company subsidiary to ND
Group lighting controllers under the eMAC and ELUTIONS, Inc., a provider of wireless
uMAC brand names. enterprise automation solutions that help
companies improve their asset performance,
energy usage, and workforce productivity.
* Represents cross-border transaction.
ND – Transaction value not disclosed.
Select William Blair & Company Transactions (cont'd)
CLOSE DEAL
8/07/09* Emerisque Capital Limited Emerisque is a London-based private-equity Acquisition of substantially all of the assets of $125.0
and S. Kumars Nationwide firm and SKNL is an Indian textile company Chicago-based apparel manufacturer
Limited listed on the Mumbai Stock Exchange that Hartmarx Corporation pursuant to §363 of the
manufactures and distributes tailored and United States Bankruptcy Code.
ready-to-wear men’s and women’s apparel.
7/24/09 Waterworks, Inc. Designer, marketer and retailer of high-end Sale to investment firm Design Investors, LLC ND
(Berkshire Partners) bath fixtures, fittings and furnishings, pursuant to a §363 sale.
operating 15 showrooms in affluent markets
across the United States.
5/20/09 Robbins Bros. Corporation Chain of engagement ring stores in the Sale of Robbins Bros. Jewelry, Inc. & ND
United States. Spence Diamonds, Inc. jewelry store chains.
4/11/09 American Corrective Provider of outsourced educational diversion Sale to Levine Leichtman Capital Partners, $26.3
Counseling Services, Inc. programs in the U.S. a middle market private equity firm.
3/26/09 Filtrona plc One of the largest extruders of thermoplastic Divestiture of its North American profile, tube $115.0
(Filtrona Extrusion Holding profile, tube and sheet in North America. and sheet extrusion business (“Filtrona
Companies) Extrusion”) to private equity firm Saw Mill
Capital Partners, L.P. and Management.
3/23/09 FCA Inc. Supplies high value-added, industrial heavy- Sale to Ancor Capital Partners and Prairie ND
duty packaging and related supply chain Capital Partners.
services.
3/18/09* The Cambridge Group Business strategy consulting firm hired by Sale to The Nielsen Company, a global ND
Fortune 1000 companies to design and information and media company with leading
implement growth strategies. market positions in marketing and consumer
information, television and other media
measurement.
3/16/09 Allscripts’ Medication Provides point-of-care medication Sale to A-S Medication Solutions, a national $26.0
Services Group management and medical supply services provider of managed care solutions.
and solutions.
3/12/09* Pivotal Research Centers Contract research organization with Sale of Pivotal Research Centers, a ND
extensive experience in multiple therapeutic subsidiary of Pioneer Behavioral Health
areas. (AMEX: PHC) to Premier Research Group,
Limited, a privately-held contract research
organization based in the United Kingdom.
3/06/09 ExtruMed, LLC Precision thermoplastic medical tubing Sale to Vesta, Inc. which provides products to ND
(Inverness Graham manufacturer. the OEM medical device industry and is a
Investments, L.P.; Wedbush portfolio company of Roundtable Healthcare
Capital Partners, L.P.) Partners.
2/27/09* Photo Therapeutics, Aesthetic dermatological devices. Sale to PhotoMedex, Inc. a provider of a wide $13.3
Limited range of medical products and services.
2/09/09 Payformance Corporation Healthcare IT. Sale to ABS Capital Partners. ND
1/30/09 Saleen, Inc. Manufacturer of high-performance niche Sale to Cyltec LLC, a manufacturer of ND
automobiles and aftermarket parts. automotive parts.
1/23/09 Niman Ranch Producer of all-natural fresh beef, pork, and Sale to Natural Food Holdings. ND
lamb, as well as prepared foods.
1/22/09 Xactly Corporation Leading software-as-a-service (SaaS) Acquisition of Centive, Inc, a provider of on- ND
provider of on-demand sales compensation demand sales compensation solutions.
solutions.
1/18/09* ICON Medical Imaging Medical Imaging CRO. Sale to ICON PLC, a clinical research ND
organization.
12/31/08 Gateway Ethanol Ethanol plant production. Sale to DIP lender Dougherty Funding, LLC. $63.0
* Represents cross-border transactions.

CLOSE DEAL
12/22/08 Pensar Electronic Provider of low-to-medium volume, high mix Sale to LaBarge, Inc. a contract manufacturer $45.0
Solutions, LLC (broad line of relatively shorter run SKUs) of electronic, electromechanical, and
outsourced electronic solutions across a interconnect systems.
diverse range of end markets.
12/19/08* Sorex Holdings Ltd. Independent manufacturer and supplier of a Sale to BASF SE, the world’s leading chemical ND
(Indigo Capital LLP) broad range of chemical and non-chemical company.
pest-control systems.
12/15/08* TDX Group Limited Multinational provider of proprietary, Sale to private equity firm Investcorp $110.2
(Blenheim Chalcot) analytics-based arrears management Technology Partners.
solutions for defaulted consumer debt.
11/20/08 Francisco Partners Global private-equity firm focused Acquisition of API Software, Inc. which ND
exclusively on investments in technology develops labor cost management applications
companies. for hospitals and health systems.
11/18/08* Stainton Metal Company Designer, manufacturer and supplier of an Sale to Valmont Industries, Inc., a global ND
Limited extensive Range of galvanized and designer and manufacturer of poles and towers,
(NVM Private Equity) stainless-steel support structures. irrigation equipment and commercial tubing.
11/14/08 Chockstone, Inc. Loyalty card provider and marketing Sale to Heartland Payments Systems, Inc., a ND
services. provider of credit/debit/prepaid card processing,
payroll, check management, and payments
solutions.
11/06/08 The J.M. Smucker Company Manufactures and markets branded food Acquisition of Folgers Coffee Company from $3,425.0
products. Procter & Gamble.
11/05/08 Molex Incorporated Manufactures and sells electronic Purchase of related party stockholdings. $26.7
components.
10/31/08 TMG Health, Inc. Business process outsourcing services firm Sale to Health Care Service Corporation, the ND
(SCP Partners NewSpring providing a variety of administrative services largest customer-owned health insurer in the
Capital) to the Medicare and Medicaid health plan United States and the fourth-largest health
markets. insurer in the country overall.
10/24/08 IntelliTax Tax software company. Sale to CCH Small Firm Services, a leading ND
(a division of TRE Financial) global information services and publishing
(Platform Partners) company.
10/17/08* EBEWE Pharma International pharmaceutical company. Acquisition of Liba Laboratuarlari Anonim Sirketi, ND
Ges.m.b.H Nfg.KG. a distributor of pharmaceutical products for a
number of leading international companies
within Turkey.
10/16/08 Coria Laboratories, Ltd. Pharmaceutical company specializing in Sale to specialty pharmaceutical company $95.0
research, development and marketing of Valeant Pharmaceuticals International.
dermatology products.
10/08/08 CBOT Metals Complex Commodities Exchange. Sale to securities exchange NYSE Euronext. ND
(a division of CME Group)
10/06/08 Wm. Wrigley Jr. Company Chewing gum company. Sale to Mars, Inc. & Berkshire Hathaway. $23,100.0
* Represents cross-border transactions.

William Blair & Company Corporate Finance Contact List
William Blair & Company Corporate Finance Contact List
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William Blair & Company Corporate Finance Contact List (cont'd)
William Blair & Company Corporate Finance Contact List (cont'd)
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January 18, 2010

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January 2010
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individual, institutional, and issuing clients. Since 1935, we have been committed to helping
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philosophy is to serve our clients’ interests first and foremost. We place a high value on the
enduring nature of our client relationships, the quality of our products and services, and the Steven M. Bernard, CFA
continuity and integrity of our people. William Blair & Company is based in Chicago, with Director of M&A Market Analysis
office locations including Boston, London, New York, San Francisco, Shanghai, Tokyo, and sbernard@williamblair.com
Zurich. For more information, please visit www.williamblair.com. 312.364.8221

M&amp;A Activity

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M&amp;A Activity

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OFFICE LOCATIONS

Headquarters 3 St. Helen’s Place Kamiyacho MT Building

450 East 96th Street

U.S. M&A Activity 6

U.S. Financing Markets 16

European M&A Activity 19

Emerging Markets M&A Activity 23

Select William Blair & Company Transactions 24

William Blair & Company Corporate Finance Contact List 27

GLOBAL M&A HIGHLIGHTS

U.S. M&A HIGHLIGHTS

EUROPEAN M&A HIGHLIGHTS

Global Activity Regional Transactions

 Global M&A activity finally appears to be turning the corner.

Global M&A Activity Detail

Global Activity (cont'd) Middle-Market Regional Transactions

Global Middle-Market M&A Activity Detail

Global Activity (cont'd) Annual Transactions

Global M&A Activity

U.S. M&A Activity Transaction Detail

U.S. M&A Activity Detail

U.S. M&A Activity (cont'd) Annual Activity

U.S. M&A Activity

Number of Deals Deal Value

U.S. Middle-Market M&A Activity

Number of Deals Deal Value

5,000 4,624 4,533 4,522 4,715

U.S. M&A Activity (cont'd) Valuation Multiples

U.S. EV/EBITDA Valuation Multiples(1)

U.S. EV/EBITDA Middle-Market Valuation Multiples(1)

Median Acquisition Premiums

U.S. M&A Activity (cont'd) Private-Equity Transaction Analysis

U.S. Private-Equity Activity Detail

U.S. Private-Equity Activity

U.S. M&A Activity (cont'd) Private-Equity Transaction Analysis (cont’d)

Private Equity Activity by Target Sector

U.S. M&A Activity (cont'd) Transaction Breakdown

U.S. Middle-Market M&A Activity by Acquirer(1)

U.S. Middle-Market M&A Activity by Target(1)

U.S. M&A Activity (cont'd) Transaction Breakdown (cont’d)

Distressed U.S. M&A Activity

350 325 331

U.S. Take Private Transaction Activity

U.S. M&A Activity (cont'd) Industry Breakdown

Transaction Activity by Target Sector

ENT. VALUE/ EBITDA

U.S. M&A Activity (cont'd) Cross-Border Transaction Analysis

U.S. Middle-Market Cross-Border M&A by Number of Deals

U.S. M&A Activity (cont'd) Cross-Border Transaction Analysis (cont’d)

U.S. Cross-Border M&A — Number of Transactions

U.S. Cross-Border M&A — Transaction Value

U.S. Cross-Border M&A Transactions — 2009

U.S. Cross-Border M&A Transactions — 2008

U.S. Financing Markets Debt Capital Markets

Average Pro Forma Adjusted Credit Statistics of Middle-Market LBO Loans

(1) Total Equity equals common, preferred and rollover equity.

Average Pro Forma Adjusted Credit Statistics of Middle-Market LBO Loans

3.0x 3.4x 3.0x

Source: S&P’s Leveraged Lending Review.

U.S. Financing Markets (Cont'd)

Average Total Equity Contribution For LBO Transactions

U.S. Financing Markets (cont'd) Equity Capital Markets

IPO Pricings by Sector — Last 4 Quarters: 45 Total Deals

M&A Activity

M&A Activity

Global M&A activity finally appears to be turning the corner.