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Slideshow: How PE-Backed IPOs Have Fared In Aftermarket

You know you’ve entered the world of private equity when spreads on fund performance widen to fantastic levels. A fund that returns 10 cents on the dollar? Sure, some firms have managed it. Multiply your money by more than 8 times? Yep, private equity funds can do that too. And everything in between.

Over a long period of time, investors in buyout funds have found that their top-quartile funds will double their money or better; from their bottom-quartile funds they’re lucky to get their money back.

With some 19 U.S. buyout-backed IPOs so far this year, including those of peak-year LBO targets Freescale Semiconductor and HCA Holdings, we thought it would be a good time to take a look at whether any of this volatility has carried over to the public markets. It has.

While the overall stock market rose early in the year, before falling smartly over the summer (the S&P 500 is down 6% year-to-date at press time), the stock prices of buyout-backed companies have blazed their own paths. The worst performer: MagnaChip Semiconductor, which as of Sept. 7 had traded down more than 38 percent from its $14 IPO price in mid-March, according to data from Thomson Reuters (publisher of peHUB). It was backed by Citicorp Venture Capital Ltd, Avenue Capital Group and CVC Asia Pacific Ltd. The best performer: ServiceSource International LLC, which was up 76 percent from its $10 IPO price in late March. It had backing from General Atlantic LLC, Benchmark Capital and Housatonic Partners.

The median year-to-date performance for the bunch is -11.97%; the top-quartile demarcation is 14.78%; and bottom-quartile is -20.08%.

Click through the slide show to see the top 10 performers among buyout-backed IPOs this year. All data comes from Thomson Reuters, and is through Sept. 7.

David M. Toll is editor-in-charge of Buyouts Magazine, where you’ll find regular updates on PE-backed IPO aftermarket performance. Follow him on Twitter @davidmtoll. Follow @Buyouts.


[slide title=”No. 10 – C&J Energy Services Inc (CJES)”]

IPO Date: 7/29/2011

Industry: Oil & Gas

IPO Price: $29

Total Return Since IPO: -11.97%

Select Backers: Energy Spectrum Capital, Citigroup Private Equity

[slide title=”No. 9 – Wesco Aircraft Holdings (WAIR)”]

IPO Date: 7/27/2011

Industry: Airlines and Aviation

IPO Price: $15.00

Total Return Since IPO: -11.73%

Select Backers: Carlyle Group, Trilantic Capital Partners, Bank of America Commercial Finance

[slide title=”No. 8 – Spirit Airlines Inc. (SAVE)”]

IPO Date: 5/26/2011

Industry: Airlines and Aviation

IPO Price: $12.00

Total Return Since IPO: -1.00%

Select Backers: Oaktree Capital Management, Indigo Partners LLC

[slide title=”No. 7 – Medquist Holdings In.c (MEDH)”]

IPO Date: 2/04/2011

Industry: Medical/Health Software

IPO Price: $8.00

Total Return Since IPO: 2.37%

Select Backers: Trilantic Capital Partners, TDA Capital Partners, Frontline Strategy Ltd., Kingdom Capital, S.A.C. Capital Advisors LP, Americorp Ventures Ltd.

[slide title=”No. 6 – Tornier SAS (TRNX)”]

IPO Date: 2/03/2011

Industry: Pacemakers and Artificial Organs

IPO Price: $19.00

Total Return Since IPO: 12.37%

Select Backers: Warburg Pincus LLC, Vertical Group, Split Rock Partners LLC

[slide title=”No. 5 – Francesca’s Holdings Corp (FRAN)”]

IPO Date: 7/20/2011

Industry: Retail

IPO Price: $17.00

Total Return Since IPO: 17.18%

Select Backers: CCMP Capital Advisors LLC

[slide title=”No. 4 – Nielsen Holdings NV (NLSN)”]

IPO Date: 1/26/2011

Industry: High Technology

IPO Price: $23.00

Total Return Since IPO: 26.39%

Select Backers: Apax Partners Worldwide LLP, Blackstone Group LP, Carlyle Group, Cinven Ltd, AlpInvest Partners NV, CPP Investment Board, HarbourVest Partners LLC, Hellman & Friedman, Kohlberg Kravis Roberts & Co., Thomas H. Lee Partners

[slide title=”No. 3 – Thermon Group Holdings Inc. (THR)”]

IPO Date: 5/04/2011

Industry: Energy and Power

IPO Price: $12.00

Total Return Since IPO: 33.17%

Select Backers: Code Hennessy & Simmons LLC

[slide title=”No. 2 – Dunkin Brands Group Inc. (DNKN)”]

IPO Date: 7/26/2011

Industry: Fast Food

IPO Price: $19.00

Total Return Since IPO: 41.21%

Select Backers: Bain Capital, Carlyle Group LLC, Thomas H. Lee Partners

[slide title=”No. 1 – ServiceSource International (SREV)”]

IPO Date: 3/25/2011

Industry: Business and Office Services

IPO Price: $10.00

Total Return Since IPO: 76.00%

Select Backers: General Atlantic LLC, Benchmark Capital, Housatonic Partners