2009 annual report axa private equity

AXAPRIVATEEQUITYANNUALREPORT2009

This document contains information, including details of investment performance, in respect of funds which are closed to new investors. Past performance is not necessarily indicative of future returns on these or other funds. The value of investments may fall as well as rise. Private equity investments are illiquid and there is no guarantee that they can be sold at valuation levels. It shall not be viewed as investment advice, and does not constitute an offer to sell, a solicitation of any offer to buy, or the basis for any contact for the purchase or sale of any investment.

The portfolio companies financial data are issued by the companies.

Unless otherwise mentioned, figures are as of December 31, 2009 and the exchange rate that applies is €1 = US$1.43.

AXA Private Equity Global Investments, the European Way

$25 billion advised or managed*

AXA Private Equity is among the leading global private equity firms with

$25 billion of assets managed or advised for major international investors.

Since 1996, its constant focus on the long-term growth of its investments has

generated sustained and stable returns.

With 230 employees and eight offices in Paris, Frankfurt, London, New

York, Singapore, Milan, Zurich and Vienna, AXA Private Equity offers its

partners - companies management and investors - access to a broad and solid

network across Europe, North America and Asia.

A diversified set of asset classes including direct funds, funds of funds,

infrastructure and mezzanine means that AXA Private Equity has the expertise

and mindset to provide more than just financing.

Mezzanine

Arranger

Acquisition financing

$3 billion

Infrastructure

Brownfield

Greenfield

$2 billion

Funds of funds

Primary

Secondary

Early secondary

Mandates

Direct funds

Small cap

Mid cap

Venture

Co-investment

$7 billion$13 billion

Private EquityFirm of the Year

Financial TimesMergermarket European

M&A Awards 2009

* As of December 31, 2009

summary

Foreword of the CEO

Company profile

What’s new in 2009?

Key facts and figures InvestmentsDivestmentsNew partnerships

Corporate review

A story of sustained growthOur storyA cohesive management teamBest-in-class reportingA loyal and diversified investor baseClient-oriented support Rigorous internal governanceCorporate social responsibilityPromoting excellence

Investment review

InfrastructureFunds of fundsDirect fundsMid cap Small cap Venture capitalCo-investmentMezzanine

Glossary

10_12_23_26_

32_ 33_34_36_37_38_39_40_44_

48_52_58_60_62_64_67_72_

right time, and our ability to grow compa-

nies with the help of our international

network, set us apart. As such, we are

confident that those carefully-chosen new

companies and partners you read about in

the following pages will play a part in our

continued success in the years to come.

We are committed to helping our entrepre-

neurs transform their businesses and

expand into new markets with the support

of private capital.

foreword of the CEO

Within today’s challenging economic

environment, our distinctive culture and

investment strategy has resulted in a solid

performance, reinforcing the trust of all of

our investors around the world.

Our approach towards investments in

companies and private equity funds has

always been characterized by discipline.

This year has been no different. Our caution

in selecting the right investments at the

We support entrepreneurs in the international expansion of their businesses

/ 5

Dominique Senequier

Our industry has continued to be in the

spotlight in 2009. We welcome such

scrutiny. Responsible investment by

private equity requires moderate use of

leverage and sharing of the value created

among all parties, which is the case at

AXA Private Equity. In fact, an ethical

code frames our every interaction with

companies, funds, investors and partners.

Each individual within the firm is trusted

to ensure we subscribe to ever-improving

socially responsible standards.

Looking ahead, we are well-placed to build

upon our long-term strategy:

• stabilizing and strengthening our portfo-

lio companies and capitalizing upon our

network and resources to grow them

internationally

• benefiting from consistent returns in

infrastructure assets, given that we are one

of the few investors with experience of

investing in this sector

Responsible investment by private equity requires moderate use of leverage and sharing of the value created among all parties

• maintaining our market-leading approach

and performance in funds of funds thanks

to our vigilance, excellent market timing

and best-in-class monitoring standards.

Emerging markets will play a key role in

shaping the world economy in the years to

come. At AXA Private Equity, we have been

embracing the opportunities afforded by

our global reach for some years.

We are looking forward to building upon

this strong platform in 2010.

Our investment approach

Active since 1996, AXA Private Equity is an experienced investor with a meticulous approach

to generating consistently good returns. Because our portfolio is diversified across a range of

asset classes, sectors and geographies, we are able to capitalize upon a variety of opportunities

for our investors. Our global reach across Europe, North America and Asia benefits our partner

portfolio companies, which are often looking for support to expand internationally.

We are cautious and highly disciplined in the investments we make, having reasonable

recourse to external leverage. Yet it is also within our ability to move fast to seize the right

opportunities which has resulted in consistent returns and an enviable track record during

the last 14 years. Our teams take a long-term view and are committed to creating operational

value and sustainable growth. We believe we are successful because of the close ties we

develop with the management of our portfolio companies and partner funds.

company profile

OUR VALUESAt AXA Private Equity, we have always

prided ourselves on maintaining a distinc-

tive corporate culture underpinned by

values that define the way we work with

investors, portfolio companies, co-investors,

other funds and our employees.

• Responsible behaviour: complying with

the rules laid down by our regulators is a

baseline requirement for us. In addition,

we challenge each AXA Private Equity

employee to go beyond what is expected

and find ways to work responsibly and

with consideration for our impact upon

companies, communities and people.

• Service orientation: investors and

companies like to be treated individually.

They recoil from standard approaches.

We take time to l isten, understand

individual needs and find the best solution

for mutual benefit.

• Investment discipline: caution is our

watch-word. Every decision, from initial

investment through build-up to divestment,

is made with the most stringent due

diligence and attention to the appropriate

process.

BRINGING OPERATIONAL VALUE TO OUR COMPANIES AXA Private Equity’s investment philo-

sophy has always been broader than mere

financial engineering. In the context of the

economic upheaval that characterized

2009, our main objective was to continue

to support our portfolio companies

through these difficult times and secure

their development in the years ahead.

At the same time, we continually reassured

our investors by providing detailed, regular

assessments of the funds’ future cash

flows.

It is our duty and our commitment to

be a reliable, responsible and engaged

shareholder. So, we mobilized our resources

and network to provide our companies

with the advice they needed to deal with

these tough conditions, while ensuring

they remained focused on growth over

the long-term. Using our long-established

monitoring procedures and forecasting

systems, we helped management of our

portfolio companies adhere to good

corporate governance structures and

protocols.

/ 7

Funds of funds

Primary, early secondary and secondary

MezzanineDebt product

between senior debt and equity

InfrastructureBrownfield and

greenfield

Co-investmentMinority interests in major transactions €20–100m per transaction

Venture capitalInnovation and growth financing€2m to €5m investment in IT, internet and energy sector

Mid cap Majority investmentsin companiesvalued between €100m and €2bn

Small cap Investments in medium-sized companies with a valuation of under €100m

Active across a diversified range of asset classes

Investing across all industries (selection from our portfolio)

we maintain performance

thanks to a high level

of discipline

What’s new in 2009?Key facts and figures

Investments Divestments

New partnerships

key facts and figures2009: a year of solid returns

165 investors

2.6 funds per investor on average

7,500 underlying companies in funds of funds portfolio

150 companies in direct portfolio

500 funds in portfolio

$18.6 billioncommitted since 1996

Funds of fundsAXA Secondary Fund III (vintage 2004) 50.1% net IRRAXA Early Secondary Fund II (vintage 2004) 17.5% net IRR

AXA Secondary Funds ranked n° 6 most influential investor in The Wall Street Journal(March 17, 2009)

Direct fundsAXA LBO Fund II (vintage 2000) 33.0% net IRRAXA LBO Fund III (vintage 2005) 9.4% net IRR

AXA LBO Fund III ranked n°3 in terms of performance in the Financial Times(April 15, 2009)

AXA Expansion Fund I (vintage 2002) 16.9% net IRR

* Past performance is no guarantee of future performance. Valuations may move up or down over time. The above figures do not cover the entirety of all funds managed and/or advised by AXA Private Equity.Only the performance of certain major funds is presented here. All the figures are presented after management fees and carried interest.

Fund performance examples (as of December 31, 2009)*

Our cautious investment approach and rigorous monitoring have helped us build one of the best track records in the private equity industry.

What’s new in 2009? / Corporate review / Investment review / 11

* for mid cap, small cap and co-investment where we have a lead position** for small and mid cap

5 divestments in 2009

15 investments

in 2009

3 build-ups in portfolio companies in 2009*

3x net Debt / EBITDA

20% sales growth of our portfolio companies

since acquisition*

In 2009, we strengthened and grew our companies.

2009 was not just about stabilizing

and strengthening our companies’

fundamentals. Keen to capitalize upon

opportunities presented by the downturn,

we created value by initiating and securing

several bolt-on acquisitions for companies

within our portfolio. Three build-ups took

place in 2009. Unipex acquired Codibel

in March, Löwen Play acquired Vrakas in

April, and Gerflor acquired Ketonen during

the course of the year.

In a market environment characterized

by reduced transaction opportunities,

AXA Private Equity managed to secure

several investments, most of them during

the second half of the year: a total of 15

investments and five divestments across

the direct funds, funds of funds, mezzanine

and infrastructure activities.

In 2010, we will continue to provide operational support to our investments.

We are well-placed to take advantage of

new opportunities that may arise in the

coming months. But new investments

will be made with our usual caution and

limited leverage. We have purposefully

accumulated a reserve of undrawn

commitments across our funds, so that

we may react quickly and seize new

opportunities with advantageous terms.

The funds of funds team is also well

positioned to invest in very large secondary

opportunities.

Awards

Best Private Equity Firm in France

Southern European Private EquityFirm of the Year

Dominique Senequier, European Private Equity Most Influential Woman

Enel Rete Gas European Oil and Gas Deal

**

Interview with Frédéric Roche (CEO)Investment Date_ August 2009Country_ FranceSales 2009_ €26mEmployees_ 10

Why did you choose to partner

with AXA Private Equity?

A few months ago, a competitive

bid was organized and AXA Private

Equity was chosen to acquire 100%

of the shares of the company. Its reputation of reliability and

professionalism played a key role

in the decision. Having personally

met with many investors, I was

also able to appreciate the team’s

acute understanding of the

company’s industrial vision. Finally,

its commitment and its capacity to

support our growth strategy helped

make the difference.

What kind of resources does

the team provide you with?

With 15 wind farms mainly situated

within a 300 km radius of Paris, and

a total capacity of 163 MW, Kallista

is one of the most important wind

farm platforms in France. Our

objective is to reinforce our position

in the French and European wind

market and open it up to new

technologies. The AXA Private

Equity infrastructure team has the

capacity to create synergies via its

existing portfolio assets, such as

Saur, Sanef, Tozzi Wind Farms and

Tre & Partners. It will use Kallista as

a platform for all of its renewable

energy activities. Last but not least,

having a shareholder that is as well

established as AXA Private Equity

in the European market is extremely

reassuring and favors our long-term

development.

What does your growth strategy

depend on?

As of today, Kallista owns wind

farms. We would like to expand our

activities to evolve in the coming

years into a more comprehensive

and lucrative business which

includes project development,

operating and maintenance,

and reporting. Building on our

expertise, we also plan to expand

our infrastructure base and

develop new projects in wind

and solar energy across Europe.

Although capital intensive in the

first stages of development, such

infrastructure projects traditionally

exhibit low correlation to economic

cycles and generate stable and

recurrent returns.

2009 investments infrastructure

KALLISTA Renewable energy

How would you characterize

the potential for green energies?

There is a growing demand for

more environmentally-friendly

energies across Europe. Moreover,

because wind and other renewable

energies are available naturally,

and thus to some extent, are

inexhaust ib le , they present

good business opportunities in

the coming years. In the context

of rising oil prices, developing

the capabilities in such fields

helps secure countries’ energy

independence and international

competitiveness. Compared to its

neighbors, France is still behind and

there is an obvious need to catch

up. Now is the time to seize the

opportunity and fully benefit from

the growth potential.


Wind farm in Breteuil-Paillart (Picardie region).

2009 investments infrastructure

Investment Date_ February 2009Activity_ Renewable energyCountry_ ItalySales 2009_ €48mEmployees_ 3

AXA Private Equity and the industrial company, Tozzi

Group, have established a joint venture to invest in

the Italian renewable energy sector. The joint venture,

TRE & Partners S.p.a, acts as a holding company and

comprises investments in wind farms, hydroelectric

and solar projects in Italy. TRE & Partners consists of

Tozzi Group assets – wind farms and hydroelectric

projects already in operation - as well as projects

currently under development or construction with

a total gross capacity above 400 MW. Tozzi Group

owns 55% of TRE & Partners, with AXA Private Equity

holding the remaining shareholding.

Investment Date_ May 2009Activity_ Natural gas distributionCountry_ ItalySales 2009_ €318mEmployees_ 1,289

Enel Rete Gas is the subsidiary of the Enel Group

operating in the distribution of natural gas in Italy.

It has a market share of about 12% in terms of the

amount of gas distributed, with more than 2 million

users connected to the grid and approximately

3.2 billion cubic meters of gas distributed to more

than 1,200 municipalities in 2009.

In 2009, the infrastructure team completed three major investments in the energy sector: TRE & Partners and Enel Rete Gas in Italy, and Kallista in France.

Investment Date_ August 2009Activity_ Renewable energyCountry_ FranceSales 2009_ €26mEmployees_ 10

AXA Private Equity has acquired 100% of Kallista

Energies Renouvelables and Kallista France, which is

held through Holding Energies Renouvelables (“HER”),

a holding company dedicated to renewable energy

investments in France and with which the firm plans

to make further investments. The assets represent one

of the most important wind farm platforms in France

and comprise 15 wind farms with a total capacity of

163 MW, mainly situated 300 km from Paris. Synergies

arising from AXA Private Equity’s existing portfolio

will help boost Kallista’s growth and reinforce its

position in France.

2009 investments direct funds - mid cap

Investment Date_ December 2009Activity_ Multi-sector cateringCountry_ FranceSales 2009_ €408mEmployees_ 12,200

Newrest is a global catering company created in 1995

in Toulouse. Today it is present in 32 countries.

In this transaction, AXA Private Equity acquired 22.5%

of the shares of the company and the management

increased its shareholding from 61.3% to 67.5%, other

financial investors completing the shareholding

structure.

The company serves diversified markets such as

Airlines (58% of total revenues), Retail and Business,

Catering and Support Services. AXA Private Equity’s

international network and resources will support

the Group’s growth and reinforce its diversification

strategy.

Investment Date_ November 2009*Activity_ Home-shopping TV channelCountry_ GermanySales 2009_ €379mEmployees_ 500

HSE 24 is Germany’s second TV home-shopping

channel and number one in Austria and German-

speaking Switzerland. It offers 24-hour programming

produced at three studios in Ismaning near Munich.

With 500 employees, mainly dedicated to customer

order processing through call centers, the company

offers customers a product catalogue of about 22,000

different products in the areas of beauty, wellness,

jewelry, home and living, household goods, fashion,

sports, house and garden as well as home electronics,

half of which are new to the market. AXA Private

Equity’s involvement will provide the company with a

solid foundation for the future.

*Closing March 2010


We adopted a cautious approach in 2009 due to the decrease in available debt and high valuations. However, the team seized two opportunities in France and Germany during the last quarter, with very attractive conditions.

Interview with Olivier Sadran and Jonathan Stent-Torriani (co-CEOs)Investment Date_ December 2009Country_ FranceSales 2009_ €408mEmployees_ 12,200

2009 investments direct funds - mid cap

NEWRESTMulti-sector catering

Why did NEWREST look

for a new shareholder?

Created in 1995, Newrest is

a mature company that was

about to enter a new phase of

its development. During the

previous 15 years, the Group had

regularly evolved: after five years

of operations, Newrest joined the

Compass group in 2000 and then

regained its independence through

a management buyout in 2005. In early 2009, it was clear that

some of its shareholders wished to

exit. At the same time, Newrest was

looking to meet new challenges

and needed additional means to

fuel its growth strategy. Under

the agreement, achieved with

no leverage, AXA Private Equity

acquired 22.5% of the equity, the

management and employees

increased their stake from 61.3% to

67.5%, 10% remained with existing

shareholders. The transaction was

designed to allow shareholders to

fully focus on creating operational

value.

How would you define

your collaboration

with AXA Private Equity?

Newrest is a dynamic company

which is present in 32 countries

and has doubled revenues since

1995. We believe entrepreneurial

spirit and initiative are key to our

success. The management and

employees of Newrest hold the

majority of the company’s capital. AXA Private Equity is our chosen

partner and we have regular

interaction. The team efficiently

challenges us and demonstrates

a perspective and proactivity that

are in line with the way we work.

What is NEWREST’s

growth strategy?

Over the years, the Group has

extended its range of food services

through a multi-sector catering

model. Inflight catering generates

58% of total revenues, Retail and

Business Solutions (catering

concepts), along with Catering and

Support Services (management of

restaurants, cafeteria and reception

rooms) make up the rest.

Newrest’s strategy is aimed at

taking ful l advantage of the

numerous opportunities in the

booming food industry. We plan

to consolidate our international

reach and expand our services into

untapped sectors. Having access

to AXA Private Equity’s worldwide

network is a clear advantage for

us. Our focus is to consolidate

our positions in Europe and in the

Middle East and to improve our

penetration of the South American

market. We are one of the few

global players in the industry. To

ensure continuous growth, we

will focus on markets, such as oil

exploration and production fields,

where we see good potential.


School cafeteria - French Polynesia

Investment Date_ December 2009Activity_ Stave-wood and barrel makerCountry_ FranceSales 2009_ €60mEmployees_ 280

Founded in 1928, Charlois is an historic and leading

wood manufacturer and barrel maker. It has been

successful in optimizing its production process

through acquisitions and now consists of two stave-

wood makers, two cask manufacturers and a pallet

manufacturer. Stave wood and barrels are sold to

2009 investments direct funds - small cap

Investment Date_ December 2009Activity_ Professional trainingCountry_ FranceSales 2009_ €168mEmployees_ 1,138

Founded 80 years ago, Cegos is now Europe’s leader

in professional training. The group progressively

expanded into various areas of training such as

e-learning and face-to-face training, in diversified

markets such as finance, management, human

resources, marketing and sales. Cegos is operational

in 28 countries. The transaction was achieved with

limited leverage, provided by six banks, which enabled

AXA Private Equity to acquire 15% of the shares and

the management team and employees to increase

their stake to 65%. Investors will back a development

project to take full advantage of the training sector’s

growth potential and increase the Group’s turnover by

more than 50% by 2014. Cegos will seek to reinforce

its position in e-learning and diversify its offer through

new technologies. It will also boost its international

growth and improve its penetration of the UK and

German markets, possibly through build-ups.

The small cap team resumed investments in the second half of the year and completed three attractive investments with good valuations and growth prospects.

Investment Date_ October 2009Activity_ Call center services providerCountry_ AustriaSales 2009_ €38mEmployees_ 2,000

Competence Call Center AG (CCC) is a European

operator of customer care centers. Founded in 1998,

the Austrian-headquartered firm currently operates

eight call centers in six countries. CCC has plans

for further expansion into Austria and elsewhere in

Europe. The company employs 2,000 people and

the largest office is located in Berlin. CCC has grown

dynamically in recent years. International development

is a priority for CCC. Therefore, the company aims

to expand its presence abroad, possibly through

build-ups, in order to better meet the needs of its

international clients.

premium wine producers all around the world, with

around 80% of the production of casks sold abroad. In

December 2009, with the help of AXA Private Equity

which acquired 31% of the new entity, Charlois Group

merged with Saury Group, the fifth largest barrel

maker in the market with a production of 50,000

barrels per year and vats used for quality wines and

brandy. AXA Private Equity’s track record in working

with family businesses means we are able to support

the Group’s international expansion strategy. The

investment team will also bring to Charlois expertise

on governance processes in companies facing

significant change.

Investment Date_ June 2009Activity_ Project portfolio management software

Founded in 1996, Planisware is a leading software

company specialising in project and product

management software.


2009 investments direct funds - venture capital

Investment Date_ September 2009Activity_ Internet community cashback site

Founded in 2000, eBuyClub acts as a social network

of purchasers and offers various services to facilitate

on-line purchases and create savings.

Investment Date_ January 2009Activity_ Software components & related services

Founded in 1999, Lusis is both a software and a

consulting company. Lusis delivers mission critical

systems to banks, finance transport and services

companies. With a workforce of 100 employees

based in France and Luxembourg, the company has

a healthy cash position and has experienced double-

digit growth since it was founded.

Investment Date_ July 2009Activity_ Domain name operator

INDOM is the leading French registrar for businesses,

offering a complete range of services with a view to

optimizing, administering and securing their domain

names. The company is well equipped to capitalize

upon opportunities arising from changes in its

market, such as the creation of new extensions and

the launch of individual country domain names. This

collaboration will secure the company for the future

and help with its penetration of the market.

Investment Date_ March 2009Activity_ Software producer

Goto Software is an emailing software publisher.

The company runs three businesses: anti-spam

technologies (Vade Retro), e-mail software

(Sarbacane) and games applications (bridge

software). GOTO Software is profitable and has

secured dynamic growth since 2004. AXA Private

Equity will provide resources and expertise to take

advantage of the booming market and help expand

the company’s client base.

Investment Date_ October 2009Activity_ Rich media and web TV content publisher and producer

Brainsonic is one of the European leaders in the

production of rich media and internet TV for

communications, marketing and training.

2009 continued to be an active year for venture funds: four investments and three reinvestments were completed in France in various sectors: solar energy, internet and information technology.

Reinvestments

Investment Date_ August 2009Activity_ Solar energy

Aviccia designs and installs turn-key solar panels

on large roofs for customers due to its combined

expertise in construction and photovoltaic facilities.

It is also developing a business producing renewable

energies based on rented roofs, which it equips and

operates.

2009 investments direct funds - small cap

CHARLOISStave-wood and barrel maker

Why did you open your company

to a financial partner like

AXA Private Equity?

Six generations of Charlois have

run this company. As a family

business, we managed to grow at

a decent pace, recently acquiring

two firms: Berthomieu in 2006 and

Malviche in 2008. As we opened

to new markets and diversified

our client base, sustaining our

growth implied a change of scale.

We were looking for a financial

boost, one that would help us

secure new acquisitions. Teaming

up with a financial partner like AXA

Private Equity, used to dealing with

family-owned companies facing

similar issues as ours, was a clear

advantage.

How would you describe AXA

Private Equity’s contribution

during the merger with Saury?

As a family-owned firm, it is

paramount for us to preserve our

identity. But, at the same time, we

need to open ourselves to external

expertise and knowledge. When

we discussed a possible merger

with Saury, it became obvious we

could not complete such a sizeable

acquisition without external help.

That is where AXA Private Equity

came in. It demonstrated a true

understanding of our sector,

and the quality of its network of

partners clinched it: one of its

investors had previously been

involved in a deal with Saury

and understood our needs and

concerns. We benefited from its

input on strategic guidance, during

and after the transaction. Now,

the merged group stands out as

the first completely integrated

high quality barrel maker, going

upstream from wood processing

to barrel making. Both the Charlois

and Saury brands retain their

separate identities, production

materials and sales operations, 75%

of which are realized abroad.

Tell us more about your growth

plans?

With the merger and the change

of scale, Charlois had to evolve:

we reorganized our internal

processes, introduced new reporting

procedures and rationalized our

corporate governance rules and

mechanisms.

The expertise and resources

provided by AXA Private Equity,

which has been regularly dealing

with s imi lar s i tuat ions , was

truly beneficial to us. Our group

organization is now fully adapted

to meet new challenges and

sustain accelerated growth. Our

sector is likely to consolidate and

we are well positioned to reinforce

our market shares through build-

ups. Charlois’s goal is to expand

its presence internationally. AXA

Private Equity’s global reach will

help us identify possible build-up

targets.

Interview with Sylvain Charlois (CEO)Investment Date_ December 2009Country_ FranceSales 2009_ €60mEmployees_ 280


Barrels at the Berthomieu cooperage. Less than 1% of the global wine production matures in French oak barrels in the most prestigious cellars of France and the whole world.

2009 investmentsfunds of funds and mezzanine

Investment Date_ December 2009Commitment_ €32m

Acquisition of a portfolio of seven US and European

buyout fund interests.

Investment Date_ September 2009Commitment_ €55m

Acquisition of two US and European buyout fund

interests.

Initial Investment Date_ November 2007Activity_ Watertight joints manufacturingCountry_ FranceCommitment_ €12m

In November 2007, AXA Private Equity invested €12m

of mezzanine finance in Siem Flexitallic, one of the

leading worldwide suppliers in watertight joints for

highly demanding applications including energy and

nuclear industry, chemicals, pharmaceuticals and

petrochemicals. Following a covenant reset for the US

Group in June 2009, the mezzanine holders agreed

on a capital increase of €2m.

Initial Investment Date_ December 2005Activity_ Automative applierCountry_ GermanyCommitment_ €10m

Neumayer holds a leading position as an automotive

supplier in Germany and operates seven plants -

one in the US, one in Italy, one in Brazil and four in

Germany. The company’s performance sharply

deteriorated in 2009 as a result of the worldwide

crisis and its impact on the automotive industry.

A consensual restructuring solution was reached in

June 2009 through which AXA Private Equity was able

to achieve a satisfactory solution with a mezzanine

and senior debt haircut. AXA Private Equity invested

€3m in super senior debt, transferred part of its

mezzanine to senior debt, and will be entitled to some

equity.

Funds of funds investments

Sawgrass Siem Flexitallic

Allen

Mezzanine investment

Mezzanine reinvestments

The fund of funds team clearly remained very selective about investments in 2009. Two acquisitions at the end of the year were completed, with exceptional conditions.

The mezzanine team primarily focused on direct investments and portfolio monitoring to anticipate difficulties and secure position.

Investment Date_ June 2009Activity_ Commercial and strategic analysis for the oil and gas industryCountry_ UKCommitment_ €19m

In June 2009, AXA Private Equity invested €19m in

the mezzanine facility for the acquisition of Wood

Mackenzie by Charterhouse. Wood Mackenzie is

a global leader specializing in the collection and

dissemination of information for the energy industry,

primarily focused on oil and gas. The company

also conducts third party research and provides

consultancy services.


2009 divestments

Date of Sale_ September 2009Activity_ SoftwareCountry_ FranceTime Held_ 8 years

In September 2009, we sold the shares to ORSYP,

an international software company. During eight years,

AXA Private Equity supported the growth of Sysload.

Over that period, Sysload secured its position as a

leading player in the supervision of IT infrastructures

and quality control for information systems. Sysload

has conquered a significant proportion of the European

market and is pursuing growth internationally.

It has more than 900 customers (30,000 licences in

production) and sustained a growth rate of 25% per

year for the past five years.

Date of Sale_ January 2009

Time Held_ 3 years and 3 months

Exit Type_ Recapitalization

Schneider is a German leader in B2B and B2C mail

order sales. The group also provides marketing

services and is one of the leading mail order catalogue

specialists in Germany. The mezzanine has been fully

repaid by a senior recapitalization allowed by a low

leverage level.

Date of Sale_ June 2009

Time Held_ 1 year

Exit Type_ Secondary LBO

Wood Mackenzie is a global leader specializing in

the collection and dissemination of information for

the energy industry, primarily focused on oil and gas.

The company also conducts third party research and

provides consultancy services. The mezzanine has

been fully repaid by the sale of the company from

Candover to Charterhouse.

Date of Sale_ January 2009

Leading Funds_ TPG / Goldman Sachs

Activity_ Mobile telecom operator

Country_ USA

Time Held_ 1 year and 2 months

AXA Private Equity sold its participation in Alltel,

the fifth largest wireless communications services

operator in the US, following the sale of the company

to Verizon.

Date of Sale_ November 2009

Activity_ ShipyardCountry_ France

Sales 2009_ €150m

Employees_ 930Time Held_ 4 years

In November 2009, after four years as a shareholder

of the company, AXA Private Equity sold its 40% stake

in Piriou to the management. During this period, we

have placed our expertise, resources and network at

the company’s disposal.

Venture

Small cap

Mezzanine

Co-investment

Interview with Pascal Piriou (CEO)Date of Sale_ November 2009Country_ France

Sales 2009_ €150mEmployees_ 930Time Held_ 4 years

2009 divestment direct funds - small cap

PIRIOUShipyard

Why did you decide to team up

with a private equity investor?

After 40 years of running a

successful 100% family-owned

business , the company was

facing two major challenges.

Some of our family shareholders

wanted to exit and we needed to

secure the company during and

after this period of transition. At the same time, the company

was undergoing rapid industrial

changes and it was necessary to

find sustainable means to finance

our international expansion. We

looked for a financial partner able

to provide strategic guidance and

fuel our accelerating growth. In

2006, we had already launched

the Mauritius subsidiary and had

just opened another one in Nigeria.

Those were large investments

and Piriou was not organized to

manage that industrial conversion

on its own. We chose AXA Private

Equity because of its moderately-

leveraged financial offering and

its proposed solutions for our

governance issues.

How did AXA Private Equity

help with PIRIOU’s corporate

governance?

AXA Private Equity had a good

understanding of our rationale and

our future needs. It helped stabilize

issues around our ownership

and came up with solut ions

to consolidate our corporate

governance structure. We set up a

Supervisory Board, implemented

better reporting rules and put

together a Group organization

compatible with our growth plans. A great deal was achieved in the

four years AXA Private Equity

partnered with us. In 2009, the

time was right for the management

to resume control of the capital

and for AXA Private Equity to exit

on good terms.

How would you describe the

collaboration with AXA Private

Equity?

AXA Private Equity held 40%

of the shares and posit ively

contributed to the development

of the company during four years.

Throughout this period, its team

acted as allies, but also challenged

us in a constructive way. The

firm’s solid network in Asia helped

expand our global presence and

enabled us to get closer to our

customers. The opening of our

Vietnamese shipyard in 2006

provided us with access to one of

the busiest shipping areas in the

world. With AXA Private Equity’s

support, Piriou moved from a

family company mainly focused

on building fishing boats into an

international diversified group.

Sales have increased from €65m

to € 150m and we now have a

930 strong workforce.


“ Franche Terre ” 90 meter fishing boat built by PIRIOU.

In October 2009, the Caisse de dépôt

et placement du Québec (The Caisse)

and AXA Private Equity decided to join

forces and share their respective market

knowledge and networks in North

America, Europe, Asia and the Middle

East to foster their portfolio companies’

international development. AXA Private

Equity and The Caisse are longstanding

partners. The Caisse has been one of

AXA Private Equity’s historical investors. This agreement marks a new stage in

collaboration and trust between the two

partners.

BROADER EXPERTISE AND SHARED RESOURCESVia the new partnersh ip, Québec

businesses will be able to benefit from

AXA Private Equity’s solid international

network, which is particularly far-reaching

in Europe and Asia. The Caisse’s experience

and multi-market knowledge, especially in

North America, will be useful in supporting

the global growth of businesses. This

partnership fully illustrates the AXA Private

Equity philosophy to help businesses it

invests in, develop both industrially and

geographically.

MEETING THE CHALLENGES OF TODAY’S BUSINESS WORLDProductivity levels, globalization and

transfer of ownership are some of the

major challenges business leaders are

facing, both in Québec and Europe.

By placing practical tools at the disposal

of portfolio companies, the alliance

contributes in a concrete way to the

growth of businesses. AXA Private Equity

and The Caisse will help companies seize

new business development opportunities:

joining a global distribution network,

searching for suppliers, developing joint

ventures, forming an alliance with a foreign

company, or acquiring an international

competitor.

MAkING THE PARTNERSHIP WORkA dedicated task force was set up to

implement the partnership and facilitate

exchanges between teams. An initial

screening of portfolio companies, both at

AXA Private Equity and at The Caisse, led

to the identification of thirty businesses

in various sectors (e.g. pharmaceutical,

natural ingredients, IT…) with cross-border

growth potential. Portfolio companies from

each party have been brought together to

enable the development of new business

opportunities.

new partnerships sharing a worldwide network

Building on existing strong ties, Caisse de dépôt et placement du Québec and AXA Private Equity formed a partnership to support businesses expanding abroad.

What’s new in 2009? / Corporate review / Investment review / 27What’s new in 2009? / Corporate review / Investment review / 27

new partnerships Caisse de dépôt et placement du Québec

By opening its network to our portfolio companies, this partnership represents a major opportunity for Québec-based companies to accelerate their cross-border development.Normand ProvostExecutive Vice-President, Private Equity and Chief OperationsCaisse de dépôt et placement du Québec

Caisse de dépôt et placement du Québec

The Caisse is a leading

financial institution

managing funds primarily

for public and private

pension and insurance

companies.

Net assets under management

CAD 131.6bnas of December 31, 2009

AN ACTIVE ADVOCATE

The objective of the Principles for Responsible Investment is to ensure that investors

take account of Environmental, Social and Governance (“ESG”) issues in their investment

decisions and practices as shareholders. The code also proposes ways in which to

implement these principles. AXA Private Equity has been active in putting those actions

into practice and is keen to act as a leading proponent of ethical and responsible

investment in the private equity community and beyond.

We are committed to responsible behavior, not only for ethical reasons but also because we believe that this will have a positive impact on the growth of the companies in which we are shareholders.Dominique Senequier, CEO

In May 2009, AXA Private Equity became one of the first private equity signatories to

the Principles for Responsible Investment issued by the United Nations (“UN PRI”),

demonstrating its renewed commitment towards responsible investment.

new partnerships Principles for Responsible Investment (UN PRI)


• Incorporate ESG issues into investment analysis and decision-making processes

• ESG analysis is a standard part of the investment due diligence in all investment areas.

• Be active owners and incorporate ESG issues into our ownership policies and practices

• Companies of our last mid cap fund are subject to a yearly ESG evaluation, which is conducted with the help of a specialized consultant.

• We promote an active policy consisting in sharing capital gains with all employees when existing from our portfolio companies.

• Seek appropriate disclosure on ESG issues by the entities in which we invest

• Our fund of funds team has compiled a questionnaire which will encourage the entities in which we invest (primary commitments) to disclose their ESG-related actions.

• Promote acceptance and implementation of the Principles within the investment industry

• We were closely involved with the first conference in France on ESG matters in the private equity industry.

• As a member of its Steering Committee, we take an active part in the Private Equity workplan of the UN PRI.

• Work together to enhance effectiveness in implementing the Principles

• We have issued our own Corporate Responsibility Charter which sets out our commitment to investors, investments, employees, society and the environment.

• An internal multi-disciplinary working group is dedicated to the CSR policy, including ESG criteria promotion and implementation.

• Report on activities and progress towards implementing the Principles

• This report, and the forthcoming corporate and social responsibility section of our website, are part of our commitment to demonstrate the incorporation of the Principles into our business.

6 UN PRI PRINCIPLES OUR ACTIONS

How we apply the six UN Principles for Responsible Investment.

we are committed to

excellence, ethics and

the long term Corporate review

A story of sustained growthOur story

A cohesive management teamBest-in-class reporting

A loyal and diversified investor baseClient-oriented support

Rigorous internal governanceCorporate social responsibility

Promoting excellence

a story of sustained growth14 years of consistent development

BUILDING A GLOBAL

INVESTMENT CAPACITY

AXA Private Equity has progressively

developed a solid network of experts and

partners around the world, in Europe, North

America and Asia. This network helps

provide our teams with a comprehensive

understanding of global market trends,

facilitates investment sourcing, favors

reactivity and makes it easier to access the

best transactions in the market.

GLOBAL REACH, LOCAL KNOWLEDGE

With 230 employees based in eight offices

worldwide, our teams have a practical

understanding of the challenges and

opportunities relative to their local and

regional markets. This in-depth knowledge

of local market dynamics is critical to

developing quality partnerships with

management teams and investors.

0.1 0.2 0.2 0.8 1.9 2.6 3.1 4.56

8

14

23

26 25

1996

19971998

1999

20002001

2002

2003

2004

2005

2006

2007

2008

2009

Assets under management (in billion dollars)

Since its creation in 1996, AXA Private Equity has managed sustained, consistent growth

in assets under management, which stands at $25 billion in 2009. Over the years,

we have diversified our activities, which now range from direct investments to funds of

funds, infrastructure and mezzanine. AXA Private Equity has demonstrated top quartile

returns since inception in all its areas of expertise.

Partnership with The Caisse de dépôt et placement

du Québec (Canada)

230 employees

Zurich and Vienna offices open

Milan office opens

Singapore office opened by Christophe FlorinLaunch of co-investment, mezzanine and Asia funds

Launch of infrastructure businessMore than 100 employees

Frankfurt office opened by Stephan IllenbergerLaunch of primary funds of funds business

London and New York offices open

Start of secondary funds of funds business by Vincent Gombault and Christophe Florin

Launch of first venture capital fund

Launch of LBO business by Dominique Gaillard

Dominique Senequier founds AXA Private Equity


our story

2009

2008

2007

2005

2001

1999

1998

1997

1996

a cohesive management team

VINCENT GOMBAULTManaging Director,

Funds of Funds

Vincent Gombault joined AXA

Private Equity in 1998 and manages

the firm’s funds of funds activities.

He spent seven years in AXA Group’s

Industrial Holdings department and

was also an Investment Manager

in the M&A department of Société

Générale. He began his career at the

French Trade Commission in Detroit,

USA. He is also a lecturer at ESSEC.

Education: Master in Financial

Techniques from ESSEC. DESS in

Banking and Finance. Degree in Law.

Master’s degree in Economics from

Paris X University, Nanterre.

DOMINIQUE GAILLARDManaging Director,

Direct funds

Dominique Gaillard joined AXA

Private Equity in 1997 and manages

direct investment activit ies.

Previously, he spent seven years

with Charterhouse France where

he was a Director and member of

the Executive Board. He began his

career at Péchiney.

Education: Ecole Polytechnique.

Ecole Nationale des Ponts et Chaus-

sées. Institut d’Administration des

Entreprises. Master of Science from

UC Berkeley.

DOMINIQUE SENEQUIERChief Executive Officer

Dominique Senequier joined AXA

Group in early 1996 and founded

AXA Private Equity. At GAN from

1987 to 1995, she created and

developed the subsidiary GAN

Participations. Prior to that, she

was Group Acquisitions Manager

at GAN and spent five years with

the French Insurance Commission.

Education: Ecole Polytechnique. DEA in Banking and Monetary

Economics from the Sorbonne

University. Member of the Interna-

tional Actuarial Association.

CHRISTOPHE FLORINChief Operating Officer

Managing Director, Asia

Christophe Florin joined AXA

Private Equity in 1998 to participate

in the development of the funds of

funds business and has directed the

Asian business since 2005. He is also

responsible for the Administration

and Finance, Legal and Human

Resources departments. Previously,

he worked in GAN’s unlisted

company investments team, at

Développement et Partenariat and

also at Crédit National.

Education: MBA in Finance from

Université de Laval, Quebec. Degree

from Sciences Po. Paris.

STEPHAN ILLENBERGERManaging Director, Germany

Before launching AXA Private

Equity’s German-based business

in 2001, Stephan I l lenberger

spent three years as a Managing

Partner of Doertenbach & Co,

an independent management

company. Previously, he was Head

of Corporate Finance Germany at

NatWest Markets and CEO of York

Hannover. From 1987 to 1992 he was

Director of Bayerische Vereinsbank

in the M&A department. He started

his career with McKinsey and TA

Associates.

Education: MBA from the University

of Munich. MA in Economics from

Chicago University.

AXA Private Equity Executive Board Members*

We value entrepreneurship in private equity.Dominique SenequierChief Executive Officer

* From left to right.


Vincent Gombault, Dominique Senequier, Stephan Illenberger, Dominique Gaillard, Christophe Florin (from left to right).

All the members of the Executive Board have worked together since the early years of the company.

best-in-class reporting

Frequent and direct communication

with investors is critical: our team of

nine local relationship managers based

in North America, Continental Europe,

United Kingdom, Asia and the Middle East

maintains close contact with clients, swiftly

addressing their inquiries and organizing

regular meetings to discuss progress.

TRANSPARENCY AND REACTIVITY

Our investor relations team is continually

improving the quality of information we

provide and the service we offer. We

are commited to being transparent and

reactive to investors.

A general survey was conducted among

more than 100 investors to assess their

satisfaction with our service. As a result,

this year AXA Private Equity initiated

quarterly investor conference calls with

investors preceded by a presentation

updating investors on key actions and

performance during the last quarter.

The session is monitored and recorded

and made available to those who cannot

attend in real time.

In 2010, IntraLinks, the client online

reporting interface, will cover all of AXA

Private Equity’s funds, both direct and

funds of funds. Investors may access the

reporting information they need, such

as capital calls, through a unique and

comprehensive online tool.

According to strict regulatory requi-

rements , AXA Pr ivate Equity has

harmonized all client templates to provide

thorough and detailed information on

funds’ underlying assets. On top of the

Annual Advisory Boards and Annual

General Meetings, two global Investor

Meetings have taken place this year, one

in New York, the other in Paris, at which

more than 160 institutions from all over

the world were present.

Since 1996, throughout the different generations of funds, investors have regularly

renewed their commitment to AXA Private Equity. The client base is diverse, including

private and public pension funds, family offices, high-net-worth individuals, insurance

companies, funds of funds and government agencies. More than 80% of AXA Private

Equity’s 165 investors are based outside France and more than 46% outside Europe.


a loyal and diversified investor base

165 investors

80% of investorsbased outside France

90% re-up(1)

for our main funds

* As of December 31, 2009 – Excluding investments by AXA Group (1) Percentage of existing investors who reinvested in a new generation of funds

Geographical breakdown* Breakdown by type of investors*

6% Funds of

funds

14% Insurancecompanies

10% Family Offices/High-Net-Worth Individuals

52% Pensionfunds

9% Government

agencies

9% Others39%

North America

54% Europe

7% Asia-Australia

Middle-East

client-oriented support

Maintaining “best-in-class” standards and following rigorous processes is critical to ensuring our continued strong performance and investor commitment.Edouard Boscher, Head of Investor Relations

INTERNATIONAL NETWORk OF

INVESTOR RELATIONS MANAGERS

14 people in the Investor Relations team

develop the product line offered to

clients and are in charge of relations with

investors. Nine regional correspondents

are specifically responsible for providing

information regarding the regions

where they operate: North America,

Continental Europe, Switzerland, United

Kingdom, Asia and the Middle East.

Every day, they are supported by the

Client Servicing team for reporting

issues and by the Product Management

team for due di l igence processes.

They are backed by a professional

communications team in charge of

organizing client events and sharing key

information with the investors on a regular

basis.

DEDICATED RISk MANAGEMENT,

CONTROL AND COMPLIANCE TEAMS

Five people are ful ly dedicated to

Internal Controls, Risk Management and

Compliance issues. AXA Private Equity’s

Compliance Standards and Policies include

clear and strict policies on personal trading

of securities, control and use of non-public

information, gift policy and handling

employee complaints (whistle blowing).

DILIGENT MANAGEMENT OF

INVESTMENT VEHICLES

Among the 50 people in the Finance &

Administration Department, 30 financial

controllers are in charge of 210 investment

vehicles and assess production, valuation

and performance calculations, fund

launching analysis and integration of new

activities. Each controller is dedicated to

one product line without overlaps and

all are organized into eight dedicated

teams: LBO, co-investment, infrastructure,

retail, secondary funds, primary funds,

mezzanine and mandates.

The legal team consists of ten professionals

who manage the structuring and follow-

up of the investment vehicles and advise

investment teams on investments and

divestments.


rigorous internal governance

Standards of corporate responsibility

are laid out in the AXA Private Equity

compliance manuals and our Code of

Conduct. They endorse the following

principles: priority of investors’ interests,

in tegr i ty, conf ident ia l i ty, loya l ty,

transparency and security. Above all, our

culture demands responsible behavior

from every individual working with the

firm. Below are some of the ways in which

we ensure we are exceeding industry

standards and investors’ requirements.

COMMITTED TO IMPROVING

INDUSTRY STANDARDS

AXA Pr ivate Equity engages with

other market players and takes an

active part in professional discussions

around the industry’s working practices.

We participated in industry consultations

regarding the rules and regulations

applicable to FCPRs (French regulated

funds) and in the AFIC/AFG working group

(French Private Equity and management

associations) responsible for drafting the

new Code of Ethics for the professions.

AXA Private Equity provided its expertise

to private equity regulators in Singapore

and has recently been working with Abu

Dhabi regulators to help them define

private equity regulation locally.

RECOGNIZED FOR OUR INTERNAL

CONTROLS AND PROCESSES

In December, we obtained our fourth

annual SAS 70 Type II certification*, which

confirms the efficiency of our internal

controls and processes.

Once again, no fai l ings have been

identified by PricewaterhouseCoopers.

This certification is an internationally

recognized audit standard designed

to provide information to be used for

financial reporting purposes by clients and

investors of AXA Private Equity and their

independent auditors.

Achieving SAS 70 certif ication is of

particular importance for AXA Private

Equity’s compliance with Sarbanes-Oxley

legislation and reflects the firm’s ongoing

commitment to maintaining a strong

control environment.

ACCREDITED

PERFORMANCE REPORTING

AXA Private Equity has also renewed its

GIPS** certification attesting to the firm’s

compliance with the internationally

recognized funds’ performance presentation

standards.

* Statement on Auditing Standards No. 70 established by the American Institute of Certified Public Accountants

** GIPS: “Global Investment Performance Standards“.

Behaving ethically is a cornerstone of our corporate strategy at AXA Private Equity.

AXA Private Equity is regulated by:• AMF (French Financial Markets Authority)

• SEC (US Stock Exchange Commission)

• FSA (UK Financial Services Authority)


Under the leadership of Dominique

Senequier, a dedicated CSR (Corporate

Social Responsibility) working group

was set up this year, gathering managing

directors from our mid cap, small cap,

infrastructure and fund of funds teams

as well as senior executives from human

resources , purchas ing , corporate

development & communications, investor

relations and compliance.

This year, not only did we sign the UN PRI

(Principles for Responsible Investment)

but we became member of its private

equity steering committee and issued our

own CSR charter. We also co-organized

the first conference in France on the

application of ESG (Environment, Social,

Governance) criteria in the private equity

industry in July 2009.

corporate social responsibility

an active commitment

ACTING AS A RESPONSIBLE COMPANY

We believe diversity equals strength.

For example, 44% of all employees are

female, including our CEO, the head of our

mezzanine activities and two managing

directors in the mid cap team.

We also seek to build an environmentally

fr iendly workplace by using paper

produced from forests managed according

to sustainable development principles.

80% of our reporting is now electronic.

We sort waste and control our electricity

consumption.

Of course, our governance and compliance

principles are stringent. We focus on

ensuring good risk management practices,

adherence to regulation, comprehensive

employee engagement and careful

reputation management.

AXA Private Equity is committed to socially responsible behavior, both as a shareholder

in portfolio companies and as a company in its own right.

Improving performance responsibly

We believe being a responsible investor will improve our long-term performance by taking into account the interests of all stakeholders: • Reducing risks on portfolio companies and funds• Improving management practices of portfolio companies and funds• Making us a preferred shareholder and employer

PROMOTING CSR

ACTIONS AT PORTFOLIO LEVEL

Our responsible approach extends to

our portfolio companies. When we are

a majority shareholder, we share up

to 5% of capital gains realized with all

employees when unwinding successful LBO

transactions. This helps in aligning interests

of all stakeholders. Employees contribute

to the creation of the value in a company.

Prior to each new investment we make,

ESG criteria are assessed within our

investment memoranda, both for our direct

funds and primary funds of funds. Beyond

ESG implementation within AXA Private Equity companies

• to investors: newsletter

• to employees: presentation at seminar, internal newsletter

• to public: annual report, website, conferences, associations

• assessment of ESG criteria and action plan in investment memoranda

communication

• external consultant consolidates information and provides independent ratings on AXA LBO Fund IV companies

the initial investment stage, we carry out

environmental due diligence in portfolio

companies with industrial operations

and support initiatives aimed at reducing

the ecological impact of their activities.

This year, we commissioned an external

consultant to provide independent ratings

for each of the portfolio companies in our

latest mid cap fund. We will repeat the

exercise on an annual basis.

For each investment opportunity, environmental, social and governance factors are systematically assessed.Dominique Gaillard, Member of the Executive Board, direct funds

before investing during investment


> >

corporate social responsibility

case studies

DIANA INGREDIENTS

Diana Ingredients specializes in

producing and commercializing

natural ingredients for the food

industries (pet food, aromas,

culinary ingredients and natural

extracts). AXA Private Equity

invested in the company in 2007.

Since then, Diana Ingredients has

reinforced its position and its

international presence. It has 19

production sites and markets its

products in Europe, America,

Australia and Asia. The company

employs 1 , 300 peop le and

generated €322m of revenues in

2009. Its development strategy

and its business model include

s o l i d a n d co n c re te s o c i a l

responsibility commitments.

RESPONSIBLE HUMAN

RESOURCES MANAGEMENT

Diana Ingredients has worked

hard to create an attractive and

efficient working environment for

its employees. It has implemented a

training program for non-qualified

employees, enabling them to certify

their skills through a recognized

diploma. A diverse workforce

is important to the business.

Women represent more than one

third of the workforce and 51%

of the management. Moreover,

Diana Ingredients has partnered

with Atlas, a company which

places people with disabilities in

employment.

In 2009, the compensation system

was overhauled and now includes

a profit sharing policy for all

employees.

STRICT HEALTH

AND SAFETY POLICIES

Health & Safety issues are closely

monitored. Strict regulations and

policies have been implemented:

regular reporting procedures

help prevent accidents and rapi-

dly manage potential incidents.

A Director for Operational Excellence

is responsible for supporting health

and safety best practices; he is

backed by a network of dedicated

correspondents in the Group’s

different entities.

Foreword of ceo / 43

MAISONS TRECOBAT

AXA Private Equity invested in

Trecobat, the house builder, in

2007. Trecobat builds about 1,000

houses per year. The company

expanded its range of products,

such as wooden houses, and

invested heavily in innovation.

BUILDING

POSITIVE ENERGY HOUSES

Trecobat recently developed

the Positive Energy House, an

innovative home that produces

more energy from renewable

energy sources than it imports

f rom externa l sources . The

company was able to develop such

a product using a combination of

microgeneration technology and

low-energy building techniques,

At the 2009 Innovative Houses Challenge, held in Copenhagen, Trecobat was awarded the Golden Medal in the “ Positive Energy House” category and the Jury’s Special Price for all categories.

such as passive solar building

design, insulation and careful site

selection and placement.

Trecobat is currently building

90 houses as part of the French

Housing Ministry project “A house

for 15 euros per day”. Partly

financed by local municipalities,

these homes will have a minimum

area of 85 m2 and will be equipped

with a heating pump.

Trecobat also built 12 HQE certified

(High Quality Environmental

standard) individual houses in a test

zone as part of the “ Brest Métro-

pole Océane ” municipal initiative.


promoting excellence committed to education

AXA Private Equity has developed a

program to strengthen links between

the business world and education via

student sponsorships, grants to non-profit

organizations and mentoring programs.

In 2009, AXA Private Equity allocated ten

grants for students through partnerships

with universities and contributed to two

non-profit organizations. We funded

the studies of three students at Ecole

Polytechnique, five exchange programs to

the USA for students of the International

Master of Finance at the University of

Cergy Pontoise in France, and two grants

were given to students of the University

of Frankfurt under the “House of Finance”

program.

Frateli workshop at AXA Private Equity Paris office “How to prepare for Universities and Business Schools admission interviews”

Sofia, a Fratelli mentee, was

admitted at HEC Business School and spent six months as

an intern in our office in New York.

Created in 2004 by young professionals

concerned wi th promot ing equa l

opportunities, Frateli’s objective is to

provide a mentoring program to 18-year-

old students born into underprivileged

families. Nine employees from AXA Private

Equity provide coaching and mentoring

to young students from various academic

backgrounds, guiding them on their

academic choices and career plans.

Created in 2006, Un Avenir Ensemble’s

main objective is to assist students from

underprivileged backgrounds in France.

The association has set up a mentoring

program for young people with potential

who lack financial resources or guidance.

Three employees of AXA Private Equity

are mentors in the program.


promoting excellence human resources team and policy

INTERNAL MOBILITY

In 2009, nine employees moved internally

to another position within the company.

A VAST RANGE

OF TRAINING PROGRAMS

In 2009, internal knowledge-sharing

sessions led by various teams and open to

all employees gathered 196 participants.

128 employees took part in external

training courses. Over the year, 57% of

all staff completed at least one external

course.

INTERNAL MENTORSHIP PROGRAM

Every new employee with less than three

years’ experience takes part in the internal

mentoring program. In 2009, eight new

mentoring pairs were added to the nine

already existing. More pairs will join the

program in early 2010. An Engagement

Charter for the new mentors and mentees

has been drafted and will be included in

the 2010 program.

SHORT MOBILITY PROGRAM

Aimed at strengthening cohesion between

the members of the funds of funds team

located throughout our eight offices,

the Short Mobility Program provides the

opportunity for its members to work in

another country for three months. In 2009,

three employees took part in the program.

YOUNG ANALYST

GRADUATE PROGRAM

A year after joining the company, young

analysts participate in a nine-month

program consisting of three periods of

three months in different departments

within the firm. In 2009, 13 analysts took

part in the program, and were sent to one

of the eight AXA Private Equity offices

around the world, sharing the daily life

of a different team and discovering new

expertise.

The Human Resources approach aims at fostering the development of professional

competences via an individual approach, capitalizing on its internal resources as well as

encouraging the ongoing acquisition of best practices from external professionals. In this

team of five, areas such as Compensation & Benefits, Recruitment or Training are each

covered by a dedicated specialist.


we cover the full range of the private

equity asset class

Investment ReviewInfrastructure

Funds of fundsDirect funds

Mid capSmall cap

VentureCo-investment

Mezzanine

infrastructure

LOW RISk ASSET WITH

ATTRACTIVE, LONG-TERM RETURNS

At AXA Private Equity, we have a

strong track record in infrastructure.

As an asset class, it has an attractive

r isk/return prof i le . In f rastructure

investments are equity or quasi-equity

products displaying low correlation

with other asset classes and business

cycles and offering inflation protection.

They are long-term (usually 20 years)

investments associated with limited risk of

capital loss and strong visibility, generating

regular and sustained yield and returns.

Active since 2005, the infrastructure team

of 12 professionals has committed more

than €860 million and manages and/or

advises €1.3 billion of assets in sectors

including water, waste, motorways and

energy.

The team primarily focuses on the

European market and brownfield projects

(i.e. acquisition of an operating company

through privatization, buyout or private

placement), with an opportunistic stance

on greenfield projects (i.e. new infrastruc-

ture development).

AXA Private Equity’s strengths lie in our

solid institutional and financial network,

our expert knowledge of regulated sectors,

and our proven experience in working

with the public and private sectors. We

have a well established, high performing

track record, market recognition and

international presence. Our financial

capabilities and valuation, reporting and

legal structuring provide our partners with

the tools they need to operate effectively

and continue to grow.

€1.3 billion managed and/or advised by AXA

Private Equity’s Infrastructure team

$41 trillion global infrastructure needs by 2030

Source: AXA Private Equiy

With their good risk/return profile, infrastructure investments are attractive for investors looking for low volatility and consistent returns over the long term.Mathias Burghardt, Head of infrastructure

THE RIGHT TIMING

In 2010, conditions are converging to

create a favorable environment for seizing

the opportunities infrastructure presents.

Governments are supporting infrastructure

investments as part of their stimulus

policies to boost economic growth. As the

sector is highly regulated, infrastructure

projects benefit from friendly legal

frameworks and market entry conditions.

The combination of an increase in energy

needs and public interest in reducing

carbon emissions will generate new

opportunities in renewable energies.

Due to the economic context, many

industrial companies are currently selling

whole or part of their non-core assets. New

opportunities are arising from institutional

investors seeking to deleverage or create

liquidity through the sale of infrastructure

assets. European regulatory requirements

may lead to unbundling of certain

infrastructure assets.

Moreover, driven by world population

growth, infrastructure has to develop

st ructura l ly. I t i s est imated that

infrastructure needs will reach $41 trillion

by 2030. Now is the time to take advantage

of this emerging opportunity.

Projected annual infrastructure expenditurein the next two decades - Geographic distribution (in US$bn)

Source: CIBC World Markets Research (2009): ‘Capitalizing on the Upcoming infrastructure Stimulus’

300

200 200

153

6060

40

10Europe

China

Non-China Asia

North Americ

a

Russia

Middle East

Latin Americ

a

Africa


infrastructureportfolio

August 09 Renewable energy France 26

May 09 Natural gas distribution Italy 318

February 09 Renewable energy Italy 48

February 09 Telecom/Rail France n.a.*

August 08 Motorways France n.a.*

June 08 Water and sewerage United Kingdom 1,585(2)

October 07 Hospitals Italy n.a.*

May 07 Renewable energy Italy 22

April 07 Water and waste France 1,517

December 06 Waste management United Kingdom n.a.*

October 06 Waste management United Kingdom n.a.*

January 06 Motorways France 1,414

Company Investment Date Sector Country

Estimated 2009

Revenues in €m

* Revenues not applicable for projects in construction(1) Closing February 2010(2) Estimated amount end of March 2010

Northumberland

Cornwall

(1)

AXA Private Equity’s long-term commitment to support our development is key. Our Group is supported and positively challenged by the team’s strategic guidance and understanding of our industrial vision.Gianclaudio Neri, CEO, Enel Rete GasEnel Rete Gas was awarded “European Oil & Gas deal of the year” by Project Finance Magazine

SANEF - A16 Motorway (North of France).

Estimated 2009

Revenues in €m


funds of funds

A SELECTIVE APPROACHWe have developed a solid network of

long-term relationships with the most

prestigious private equity managers

around the world. AXA Private Equity has

more than 60 seats on advisory boards of

some of the most important funds.

Many investors have committed large

amounts in private equity funds in recent

years generating a large and sustainable

secondary deal flow for the next few years.

In such a speculative environment, we

adopted a cautious approach, relying on

our deep knowledge of the market, on our

efficient and careful pricing evaluation

method and backed by our unique in-

house monitoring system, which covers

more than 500 funds. Out of the 90

opportunities studied, the funds of funds

team realized two major investments in

early secondary funds of funds in the last

quarter of 2009.

The early secondary and secondary markets

should remain active in 2010 and 2011,

so AXA Private Equity will seek the best

opportunities at reasonable entry levels. As

investors regain trust in the economy, new

funds should be raised. We will therefore

look into opportunistic timing for primary

investments. With an investment capability

of $2.5 billion on the secondary and early

secondary markets, AXA Private Equity is

well positioned to rapidly seize the best-

performing investment opportunities.

7,500 underlyingcompanies

$1.2 billiondistributed since 2007

$20 billionassessed in 2009 : Secondary funds of funds market deal flow

500 funds in portfolio

AN INTERNATIONAL TEAM IN EIGHT

OFFICES AROUND THE WORLD

AXA Private Equity’s fund of funds team

has become a leader in the international

market: it is based on 33 investment

professionals who operate from eight

offices on three continents, in Europe,

North America and Asia. The team

manages or advises assets of over $13

billion invested in more than 500 funds

around the world, representing a portfolio

of more than 7,500 companies

Active for the past 12 years in funds of funds, AXA Private Equity has developed

an in-depth knowledge of the market and offers worldwide investors a complete

range of products: primary, early secondary and secondary funds.

Performance of secondary funds among the best on the market (as of December 31, 2009)

Vintage Net IRR*Net

multiple*Cash

on cash**Maximum

Cash at work multiple***

Secondary funds

AXA Secondary Fund I 1999 39.7% 1.90 x 184.2% 5.9 x

AXA Secondary Fund II 2001 23.1% 1.55 x 135.4% 3.2 x

AXA Secondary Fund III 2004 50.1% 1.66 x 125.6% 5.7 x

Early Secondary funds

AXA Early Secondary Fund I 2003 17.3% 1.41 x 94.2% 3.6 x

AXA Early Secondary Fund II 2004 17.5% 1.57 x 86.5% 2.7 x

AXA Early Secondary Fund III 2005 n.a. 0.94 x 25.3% 1.3 x

Past performance is no guarantee of future performance. Valuations may move up or down over time. These figures do not cover the entirety of the funds managed and/or advised by AXA Private Equity. Only the performances of certain major funds are presented here.

* After management fees and carried interest.** Ratio of distributed capital to called up capital.*** Multiple of distributed capital plus unrealized valuation divided by the net cash at work (i.e. the sum of called-up capital minus the sum of distributed capital).


Our team benefits from a strong track record and has developed a deep understanding of the market. Our high-quality network enables us to rapidly seize the best investment opportunities all over the world.Vincent Gombault, Executive Board Member, funds of funds

Amounts committed

Number of transactions

8467 77 81

298 307

120

474 501

730

0

1999

20002001

2002

2003

2004

2005

2006

2007

2008

2009

0

0

1

2

3

4

5

6

7

8

9

10

100

200

300

400

500

600

700

800

8

7

4

5

9

5 5

7 7

3

0

funds of fundssecondary and early secondary

220 4801,040

2,854

ASF I - 19

99

ASF II - 2

001

ASF III - 2

004

ASF IV - 2

007

Amounts committed

Number of transactions

2003

2004

2005

2006

2007

2008

2009

0

100

150

200

250

300

50

2

0

4

6

8

10

12

53

264

107

218

275

44

87

6

5

5

10

7

3

2

4 generations of secondary funds(in million USD)

Secondary fundsAmounts committed (in million USD) and number of transactions completed as of December 31, 2009

Early Secondary fundsAmounts committed (in million EUR) and number of transactions completed as of December 31, 2009


15

11

28

43

28

17

21 22

36

41

30

15

1

< 1998

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

funds of fundsprimary

Breakdown by investment strategy* Breakdown by region*

Number of primary funds’ commitments by vintage

7%Others

1%Distressed funds

24%Venture

68% Buyout

* Number of funds as of December 31, 2009

48% North America

8%Asia, Australia

44%Europe

funds of funds

BEST-IN-CLASS

MONITORING SYSTEM

During the past 24 months, AXA Private

Equity has developed its own monitoring

system that enables us to collect detailed

information on funds in which we invest.

The team analyzes and monitors the

majority of the underlying companies of

these funds on a regular basis.

Meet ings and cal ls with the funds’

managers are held on a quarterly basis,

providing opportunities to exchange

information about significant events and

value creation strategies, comparing our

own assumptions with those developed

by the fund managers. Since this year,

our internally-developed database, which

consolidates the transaction and market

data collected over the past ten years,

can be accessed by our 33 investment

professionals within our eight offices

worldwide.

Via the principle of pooled and shared

resources, each member of the team

updates the database directly from internal

documents (e.g. capital calls, distribution

notices, quarterly reports) and external

data, such as market studies.

The volume of information available and

the strict management of the database

give the funds of funds team a leading

position in terms of knowledge of the

private equity market. AXA Private Equity’s

unique monitoring system is a valuable

tool in a context where reactivity and

selectivity are key competitive advantages

for fund of funds managers.

AN INNOVATIVE

ARCHIVING PROJECT

Following the creation of the Electronic

Database and Monitoring tools by the

fund of funds team, AXA Private Equity

launched an Archiving Solution, which

allows the company to define which funds

of funds documents must be legally stored,

what their shelf life should be, and the

duration of legal conservation.

AXA Private Equity stands as the first

private equity player to implement

such an Archiving System, which is

certified compliant with both regulatory

requirements and archiving standards.

The database today covers 500 underlying funds (325 General Partners) or more than 7,500 portfolio companies.Benoît Verbrugghe, Head of AXA Private Equity USA


MAIN GENERAL PARTNERS

America

Pan American (KKR, Blackstone, Carlyle, TPG, TH Lee, Onex, Warburg Pincus, etc.)

Mid Market (Behrman, Brazos, Harvest, KRG,Oak Hill, SPL, WCAS, etc.)

Europe

Pan European(APAX, BC Partners, Carlyle, Cinven, CVC, Charterhouse, EQT, PAI, Triton, 3i, etc.)

Mid Market (Astorg, Bencis, Clessidra,Lyceum, Mid Europa, Pragma, etc.)

Asia and Australia

Pan Asiatic and Australasian (Affinity, CVC, KKR, etc.)

Mid Market (3i, Actis, CDH, ChrysCapital,CHAMP, HOPU, etc.)

Brooks Equipment USA Distribution 3.7%

ILC Industries USA Defence 3.4%

First Data USA Financial services 3.4%

Pelican Products USA Manufacturing 3.0%

TDF France Telecom 2.5%

Dollar General USA Retail 2.3%

IPC Acquisition Italy Consumer goods 2.0%

Keolis France Transport 2.0%

American Home Mortgage USA Financial services 1.9%

Energy Future Holdings USA Energy 1.9%

Groupe France Agricole France Media 1.8%

Selig Sealing USA Manufacturing 1.7%

US Foodservice USA Distribution 1.5%

Pneu Service Italy Distribution 1.5%

Alliance Boots United Kingdom Healthcare 1.4%

Biomet USA Healthcare 1.4%

Elster Germany Energy 1.4%

Peacock Engineering USA Manufacturing 1.4%

Snaam France Construction 1.1%

Cobra Italy Consumer goods 1.1%

Total Top 20 Companies

Company Location Sector % of Portfolio Valuation

FUNDS OF FUNDS’ PORTFOLIO EXPOSURE TO MAJOR COMPANIESAs of June 30, 2009

40%

Through its funds of funds business, AXA Private Equity gains exposure both directly to the best fund managers and indirectly to a very wide range of companies worldwide.

direct funds

FOCUS ON LONG-TERM VALUE CREATION

At AXA Private Equity, we are focused

on supporting the growth of companies

in which we invest. As a responsible

shareholder, AXA Private Equity’s

contribution goes beyond pure financial

support . Teams work closely with

companies’ management to provide

strategic guidance and constructively

challenge decisions. Regular dialogue

and mutual trust are fundamental to our

approach. We provide advice on corporate

governance, group organization and

management, finance and legal matters

and environment or social responsibility-

related issues.

We are defined by our cautious approach.

Leverage is kept to a minimum and exit

conditions are discussed thoroughly at

the time of investment to the satisfaction

of all parties. Once we are committed, we

closely monitor financial positions, support

management, especially during times of

difficulty, and facilitate access to external

experts through AXA Private Equity’s

international network.

In light of the deteriorated economic

environment in 2009, we spent a great

deal of time and resources monitoring

portfolio companies and providing

guidance to management. We were also

able to capitalize upon the investment

opportunities presented by the downturn,

investing in nine companies: two mid

cap, three small cap and four venture

capital. Continuing our strategy of helping

companies to grow, we assisted in three

build-ups.

MEETING STAkEHOLDERS’ EXPECTATIONS

AXA Private Equity conducted a survey

last year aimed at assessing our practices

and investment strategy. More than a

hundred people, including company

managers, bankers and government

representatives were interviewed.

As a result, we are adapting our approach

to meet the evolving expectations of these

stakeholders.

A NEW CSR

PARADIGM FOR DIRECT FUNDS

As part of a comprehensive effort to

disseminate responsible practices to

portfolio companies, AXA Private Equity

hired a consultant to conduct an ESG

(Environment, Social, Governance) analysis

on companies in our fourth generation

buyout fund. The results have been

shared with these companies, and we are

monitoring and assisting them in making

appropriate changes to their business

practices.

AXA Private Equity’s direct funds team invests in companies of all sizes in a variety of

sectors across Europe. We have developed a diverse set of investment vehicles, including

small and mid cap, venture and co-investment. The direct funds team is composed

of 40 professionals based in Paris, Frankfurt, Milan, Vienna and Singapore.

Our portfolio companies are headquartered in 21 countries around the world.

SWEDEN

FINLAND

NORWAY

DENMARK

INDIA

KOREA

CANADAUNITED STATES

CHINA

BELGIU

M

LITHUANIA

NETHERLANDS

GERMANYFRANCE

POLAND

AUSTR

IA

BULG

ARIA

HUNGARYITALY

SPAIN

UNITED K

INGDOM

direct fundsportfolio


We want to change the rules for private equity. We believe that AXA Private Equity can set a benchmark for other investors with our sustainable approach to company investment. Dominique Gaillard, Executive Board Member, direct funds

direct fundsmid cap

CREATING OPERATIONAL VALUE

Focusing on majority or active minority

investments in companies valued between

€100 million and €2 billion, the mid cap

team of 17 professionals has carried

out 41 transactions since its creation

and has participated in over 40 add-on

acquisitions.

We have been very cautious in 2009

focusing on the monitoring of our portfolio

companies. During the second half of the

year, we resumed investments.

In 2009, AXA Private Equity invested

€45 million in one transaction, committed

a further €200 million, and has €1 billion of

available cash to invest by 2013.

Sector diversification

7%Construction and Building Materials

19%Technology,

Mediaand Telecom

29%Consumer Goodsand Services

43% Industrials

2%Aerospace and Defence

We care about our companies and support their growth in the long term. Philippe Poletti, Head of mid cap France, Germany and Italy

direct fundsmid cap portfolio

December 09 Multi-sector catering France 408

November 09 TV home-shopping channel Germany 379

May 08 Active ingredients and specialty chemicals

France/Canada 131

April 08 Gaming arcade operator Germany 149

June 07 Natural ingredients for pet food, human food, beverages & pharmaceuticals

France 322

January 07 Specialty chemicals Germany 294

November 06 PVC flooring France 414

October 06 Specialty chemicals France 164

September 06 Airport ground support equipments France 193

May 06 Radio and internet (blogs) France 41

April 06 Concrete sleepers Germany 158

February 06 Licence-free vehicles France 103

November 05 Laundry and home-cleaning products France 325

December 04 PVC profiles for doors and windows Germany 207


Olivier Sadran, co-CEO, Newrest

AXA Private Equity acquired its shares with no leverage and the deal enabled the management to increase its stake. Shareholders can now fully focus on operational value creation.

(1)

(1) Closing March 2010

Estimated 2009

Revenues in €m


direct fundssmall cap

ENTREPRENEUR-ORIENTED

INVESTMENTS

AXA Private Equity’s small cap team

focuses on companies with a valuation of

less than €100 million where a majority

holding is taken, or less than €500

million in the case of a minority holding.

Companies are often family companies

looking for finance in order to continue

their growth, or, where it is necessary, to

increase share capital. AXA Private Equity

supports them for an average period of

five years.

In light of difficult market conditions in

2009, the 13 members of the small cap

team scrutinized the cash and working

capital of portfolio companies. We helped

consolidate corporate structures and

processes, and establish efficient reporting

procedures and management forecasting

systems.

EASTERN EUROPE

The Eastern Europe team, based in Vienna

since 2008, has prioritized mid cap, small

cap and expansion deals. 2010 should be

a year of economic recovery in Central

and Eastern Europe, with interesting and

affordable investment opportunities to

capitalize upon.

17%Healthcare and

Life Sciences

18%Technology,

Media and Telecom

28%Business Services

32% Industrials

5% Construction and Building Materials


We support family-owned companies to expand internationally or to optimize their capital structure.Dominique Gaillard, Executive Board Member, direct funds

Access to AXA Private Equity’s international network, together with its excellent knowledge of the pharmaceutical industry, will help us implement our growth plans and achieve strategic build-ups.

direct fundssmall cap portfolio

December 09 Professional training France 168

December 09 Stave wood and barrel-maker manufacturer France 60

October 09 Call center Austria 38

December 08 Food ingredients Belgium 36

July 08 B2B information provider France 52

January 08 Manufacturer of hydraulic valves Italy 20

June 07 Manufacturer of generic pharmaceutical products

France 68

May 07 Promotional marketing software France 12

February 07 Single-family houses building company France 88

October 06 Manufacturer of plastic containers and palettes

Germany 12

September 06 Industrial framework for single family houses France 47


March 06 Claims collection services France 40

July 05 Technical and graphical analysis of financial markets

France 12

September 04 Social contribution, tax and operating cost reduction consultancy

France 57


Estimated 2009 Revenues in €m

Pierre Banzet, CEO, Synerlab


direct fundsventure capital

SUPPORT ENTREPRENEURS

IN FOSTERING GROWTH

Active in venture for almost 14 years, AXA

Private Equity supports firms that have

the potential to transform innovation into

growth. We always invest at a sufficiently

mature phase in their development when

they are in a position to capitalize upon

their unique proposition. AXA Private

Equity’s venture team is particularly valued

for its entrepreneurial approach and its

expertise in the Information Technology,

Internet and Cleantech sectors.

We always invest in equity to create

corporate value. There was no noticeable

decline in performance in 2009, with

20 out of 24 portfolio companies profitable.

Our line of action is focused on supporting entrepreneurs whoturn innovation into growth, therefore creating value and jobs.Laurent Foata, Director, venture capital

FACILITATING CONTACTS BETWEEN

ENTREPRENEURS AND INVESTORS

AXA Private Equity sponsored “Tremplin

Entreprises”, an event which we have

supported since its inception 11 years ago.

Organized by the French Senate and the

ESSEC Business School, it provides an

opportunity for 30 teams of entrepreneurs

to present their projects to investors who may

potentially be interested in financing them.

AXA Private Equity participated in three

selection committees: Software & Systems,

Internet & Services and Energy, Materials &

Components.

direct fundsventure capital portfolio

AXA Private Equity truly understands the challenges facing entrepreneurs and its pragmatic, constructive approach fully convinced me to partner with the firm.Thierry Tarnus, Founder, Goto Software

December 09 Equipment for air and water quality measurement (1) France

August 09 Development and installation of turn-key solar panels France


ENERGY AND ENVIRONMENT

(1) Listed companies

December 09 Publishing of an electronic CAD software (1) France

December 09 IT services (1) France

March 09 Software producer France

January 09 IT Services France

March 08 IT Services specializing in business process outsourcing France

May 07 Promotional marketing software France

December 06 Rich media and web TV content publisher and producer France

November 06 IT Services (1) France

July 05 Windev development environment software France

March 05 Mobile device management software France

January 05 Financial management software France

December 02 Project portfolio management software France


SOFTWARE AND INFORMATION TECHNOLOGY



direct fundsventure capital portfolio

December 06 Development of oncology cell therapies France

July 06 Prenatal diagnosis France

September 04 Cellular therapy for the treatment of inflammatory diseases France

March 04 Molecular diagnosis laboratory Netherlands

September 02 Development of immune modulation drugs France

July 02 Knowledge management platform for life sciences France

Company Investment Date Country

LIFE SCIENCES

October 06 Alternative discount telecommunications operator (1) France

July 06 Development and production of diode-pumped solid statelasers

France

September 04 Made-to-measure mobile telecoms terminals manufacturer France


TELECOMS AND COMPONENTS

July 09 Domain name operator France

February 09 Online shopping search engine (1) France

April 08 Construction and home improvement website France

January 08 Social cataloging France

December 07 Affiliation platform France

January 06 Internet community cashback site France


INTERNET AND DIGITAL MEDIA


Sector

Sector

direct fundsco-investment

COLLABORATING FOR GROWTH

Via our co-investment activity, we have

established partnerships with several key

private equity managers for large and mid-

size LBO transactions, involving companies

whose valuation may reach several

hundred million or several billion of euros.

Because of poor economic conditions

and limited access to debt, 2009 was an

unpredictable year and AXA Private Equity

remained very cautious on investments.

The firm has invested over €1 billion

in 32 companies worldwide since 2005,

meaning we are among Europe’s leading

players for such transactions. The co-investment team has enjoyed

privileged relationships with major

international funds and benefited from

AXA Private Equity’s well established ties

with other key industry players.

A team of five professionals runs the

portfolio and supports existing investments

such as Keolis and its acquisition of

EFFIA, a subsidiary of SNCF. One exit was

conducted during the year. AXA Private

Equity is ready to resume investing, with

more than €500 million available for

investment in the next two years.


4%Energy & Utilities

6%Healthcare & Life Sciences

12%Business Services

17%Industrials

22%Consumer Goods & Services

39% Technology, Media & Telecom


Our close relationship with a large

international group such

as TDF illustrates

our ability to be an active shareholder.Alexandre Motte, Director,

co-investment


direct fundsco-investment portfolio

August 07 Manufacturer of automatic transmissions for commercial vehicles

United States 1,269

July 07 Pharmaceuticals and beauty products retailer and wholesaler

United Kingdom 20,910

July 07 Nursing homes operator United States 191

April 07 Passenger transport operator France 3,424

March 07 Mobile network operator Lithuania 192

January 07 Broadcasting and transmission services provider

France 1,574

November 06 Semiconductor components manufacturer United States 2,524

November 06 Equipment rental services supplier United States 923

November 06 Wood-based building materials distributor Finland 333

September 08 Safety closures and aluminium screw capsmanufacturer

Italy 311

April 08 Telecom towers operator India 626

March 08 Automatic food & beverage vending machines operator

Italy 180

January 08 Casino entertainment and hotel operator United States 6,408

December 07 Life insurance Korea 4,800

October 07 Electricity generation and distribution United States 6,868

September 07 Payment processing services provider United States 6,366

September 07 Manufacturer of specialty vessels China 1,392


Estimated 2009 Revenues in €mSector

September 06 Cable-TV operator Sweden 385

September 06 Semiconductor components manufacturer Netherlands 2,734

August 06 Nursing homes operator France 480

August 06 Roofing materials distributor United States 564

August 06 B2B, media measurement and marketing information provider

Netherlands 7,338

April 06 Kidney dialysis clinics operator United States 254

April 06 Marble and granit distributor Spain 213

February 06 Cable-TV operator Poland 97

December 05 Plastic pipes & fittings B2B retailer France 707

October 05 Electrical parts and supplies B2B distributor

France 11,307

August 05 Multi-facilities services provider (cleaning, property services, office support…)

Denmark 9,664

August 05 Manufacturer of natural ingredients for the food industry

Denmark 520

August 05 Commercial aircraft composite structures manufacturer

United States 2,934

August 05 Fast fit automotive services United Kingdom 1,084

Company Investment Date Sector CountryEstimated 2009 Revenues in €m



The relationship with AXA Private Equity has proven to be constructive in many ways. The firm is a supportive shareholder and helpful partner for our development projects. Olivier Huart, CEO, TDF Group

STRATEGIC ACQUISITION PLAN

In March 2009, Keolis entered

into an agreement to acquire

EFFIA from SNCF. EFFIA is the

third French parking operator

with 65,000 parking spaces in key

locations such as railway and coach

stations.This acquisition is part of

a comprehensive development

project aimed at diversifying the

Group’s activities and expanding

its presence at every stage of

the value chain of urban mobility

systems. It is also hoping to regain

full control of strategic companies

in which it has a minority stake or is

in a joint venture.

Expanding i ts internat ional

presence is a priority. Keolis

plans to build upon its standing

in interurban coach transport in

France, but also in the UK and

in German railways. In 2010, it

is actively looking to boost its

presence in North America through

opportunistic acquisitions.

AN AMBITIOUS

INDUSTRIAL PROJECT

Keol is ’s a im is to become a

leading global mobility operator.

Through network, expertise and

connections, shareholders support

the management’s development

strategy based on large contract

gains, selective acquisit ions

and financial discipline. In three

years, Keolis secured several key

advances.

In 2009, the Group’s turnover

reached €3.4 billion and it now has

45,500 employees. AXA Private

Equity, together with the Caisse

de dépôt et placement du Québec,

provide advice on and contacts

for acquisitions abroad, as well as

knowledge of regulated markets.

AXA Private Equity helped Keolis

broaden its understanding of the

business by opening its network

to the company and facilitating

access to sector experts, such as

Michel Derbesse, the former CEO

of Bouygues Holding company,

today President of Keolis Group’s

Supervisory Board. Keolis signi-

ficantly reinforced its market

position in 2009 by securing major

contracts in Bordeaux, London,

and Melbourne.

Keoliscase study

KEOLISPassenger transport operatorkEOLIS is a private passenger transport company, the sixth

largest in Europe. The Group operates bus, metro and tram

networks and rai l systems, based on long-term contracts

(five to ten years) granting exclusivity to manage transport

systems in France and 12 other countries. AXA Private Equity

invested in the company in 2007, alongside the Caisse de dépôt et

placement du Québec.

2 billion peopleuse Keolis transport facilities

every year

€3.4 billionturnover in 2009: 59% in France,

41% abroad

24%sales growth since 2007

160 subsidiaries in 13 countries in Europe, Algeria,

Australia, Canada and United States

30,000 drivers

45,500employeesand more than

AXA Private Equity is a dedicated shareholder, providing us with the right incentives on management processes and financial discipline. It brought us truly valuable insights on our build-up strategy.Michel Bleitrach, CEO, Keolis


keolis buses operate inter-city links in more than 70 French departments.

mezzanine

A DYNAMIC TEAM

Mezzanine is a source of subordinated

financing, between equity and senior

debt, which is used in leveraged buyouts

but a lso for f inanc ing expans ion

projects, acquisitions and shareholder

reorganizations. The team consists of

11 people based in Paris, New York, London

and Milan.

Our diversified portfolio of 51 companies

worldwide provides the team with good

visibility on market trends and allows for

benchmarks. Through close and proactive

monitoring, we are in general able to

anticipate major difficulties and secure our

positions.

The mezzanine activity at AXA Private

Equity benefits from a strong inter-

national reach and synergies with other

teams within the firm. The funds have a

¤1.2 billion investment capacity to deploy.

Through a cautious approach, three main

priorities will guide investments in the year

to come: opportunistically targeting high-

performing buyout transactions, providing

resources to companies looking into

acquisitions and acting as an alternative

solution to banks, selectively participating

in refinancings to extend and amend

existing maturities on existing debt.


23% Consumer Goods and Services

2%Energy & Utilities

23%Healthcare &Life Sciences

17%Business services

15%Industrials

11%Technology Media

and Telecom

7%Construction and Building

Materials

2%Aerospace and Defence

June 09 Commercial and strategic analysis to companies operating in the oil and gas industry

United Kingdom 120

November 08 Inspection, audit for building and public works France 434

October 08 Pan-European medical service provider Europe 345

October 08 Specialized medical test laboratory France 226

September 08 Provider of cash automation equipment to financial institutions

United Kingdom 356

September 08 Photo sensor technology Europe/North America

166

September 08 Laundry detergents and personal care products United States 1,467

August 08 Chain of dental practices United Kingdom 70

August 08 Consulting firm specialized in government projects

United States 2,176

August 08 Civil engineering Canada 130

July 08 Marketing and sale of freight capacity for cargo and airlines

France 25

May 08 Gas springs, dampers and actuators for industrial applications

Germany 281

April 08 Telecom operator Bulgaria 501

April 08 Reinforced fiberglass plastic manufacturer China 37

March 08 Chain of bed and mattress stores United Kingdom 270

Company Investment Date Sector CountryEstimated 2009 Revenues in €m

mezzanineportfolio


Our diversified portfolio provides us with good visibility on market trends. Cécile Mayer-Lévi, Head of mezzanine

February 08 Railway logistics operator Poland 183

February 08 Helicopter operator Italy/Spain 309

January 08 Designer and manufacturer of standard and custom power supplies, converters and inverters

France 63

November 07 Watertight joints France 74

November 07 Telecom and IT France 174

November 07 Crane rentals and sales France 43

November 07 Metrology and calibration services France 87

October 07 Manufacturer and distributor of branded pool equipment

France 473

October 07 Home healthcare services United Kingdom 739

September 07 Ingredients and aromatic product for the food industry

France 66

September 07 Satellite telecommunications France/Norway 477

August 07 Women’s ready-to-wear clothing France 765

August 07 Retail chain for home and office storage solutions United States 382

July 07 Veterinary pharmaceutical laboratory France 392

July 07 Moving company for offices and households France 59

June 07 Mobile telephone operator Lituania 195

May 07 Retail chain of branded discounted products France 145

April 07 Passenger transport operator France 3,424



mezzanineportfolio


March 07 Prefabricated concrete elements France 271

March 07 Blood analysis systems for diagnosing allergies, asthma

Sweden 324

March 07 Aluminium profiles for windows, verandas and doors

Belgium 243

February 07 Specialty chemicals Germany 294

February 07 Consulting firm in information systems Spain 383

January 07 Indoor perfumes France 50

November 06 Cable operator Netherlands 1,280

November 06 Pharmaceutical and cosmetics industry France 107

October 06 Logistics for non strategic purchasing France 138

September 06 Retailer of perfumes and beauty products Italy 355

June 06 Concrete sleepers and system provider for railways

Germany 158


April 06 Cleaning and rental of flat linen and working apparel

France 142

April 06 Claims collection services France 35

January 06 Engineering for telecommunications France 179

January 06 Licence-free vehicles France 103

December 05 Sub-contractor in the motor industry Germany 394

November 05 Manufacturer of swimming pool covers France 42




Printed on PEFC certified paper, from sustainable forests by Bis’Art – April 2010

This publication has been prepared

by the AXA Private Equity Communications Department

Graphic Design

RESEARCH STUDIOS PARIS

CREDITS

p.4, 12, 35 ©Richard Cognep.13, 14 ©Kallista p.14 ©Enel Rete Gas p.14 ©Tre & Partnersp.15 ©Elias Badras p.15 ©HSE 24p.16 ©Newrest

p.17 ©Denis Rillardonp.18 ©Cegosp.18 ©CCCp.18, 21 ©Olivier Chatelainp.20 ©Christophe Deschanel p.24 ©Pirioup.25 ©M. Mochet (AFP)

p.42 ©Diana Ingredientsp.43 ©Trecobatp.44 ©Vincent Girier Dufournierp.51 ©Fernand Burgerp.71 ©Keolis

glossary

BUILD-UPA company acquisition designed to expand a group and generate synergies.

BUYOUTSee LBO.

CLOSING This represents completion of a transaction when all participants (i.e. directors and financial investors) sign the final legal purchase agreement and consideration is paid over.

DEAL FLOWThis describes investment opportunities in a market.

DIRECT FUNDSA fund investing directly in companies.

DUE DILIGENCEA series of audit procedures enabling an equity investor to form an opinion regarding the assets, business, organization, financial situation and outlook of the company in which he/she plans to invest.

EARLY SECONDARY FUNDS OF FUNDS Funds of funds for which drawn capital represents between 15% and 50% of commitments.

EXPANSION CAPITALThis is a segment of private equity relating generally to a minority investment in equity, or capital akin to equity, with a view to fund the growth of a profitable company with significant growth outlook.

FUNDS OF FUNDSA fund investing in other funds.

GIPSGlobal Investment Performance Standards. These are international ethical standards for an objective presentation of results and performance. These standards ensure fair and complete presentation of past performance, and transparent and complete disclosures.

GPGeneral Partner. This refers to companies managing funds.

IRR Internal Rate of Return. This is a performance indicator for private equity transactions which measures the average annualized return of an investment that includes cash outflows, cash inflows and valuation.

LBO Leveraged Buyout. This is both debt and equity finance for an acquisition. LBOs consist of purchasing a company with the backing of bank debt.

LPLimited Partnership.This is an investment vehicle combining investments from several partners. The LP is managedby a General Partner (GP).

MEzzANINESubordinated debt which bridges the gap between equity and senior debt and consequently benefits from an intermediate return. The debt component generates interests and the equity component provides a potential upside.

MULTIPLEThis is a performance indicator based on the ratio of the proceeds received for the sale of an investment with the cost of the initial capital investment.

PRIMARY FUNDS OF FUNDSFunds of funds which invests in new funds (less than 15%).

PRIVATE EQUITYThe term “private equity” generally concerns investment in equity in unlisted companies.

SAS 70Statement on Auditing Standards no. 70. This is an international certification compliant with standards issued by AICPA (American Institute of Certified Public Accountants), which details the operating procedures of an asset management firm and assesses the effectiveness of internalcontrols.

SECONDARY FUNDS OF FUNDSFunds of funds which invests in funds which are more than 50% funded.

SOURCINGIdentifying new investment opportunities.

SRISustainable and Responsible Investment (SRI).

VENTURE CAPITALThis is a segment of private equity relating to investment in equity or capital akin to equity, of young companies or start-ups which have a significant high-tech content.

PARIS20 place Vendôme75001 Paris - FranceTel: +33 1 44 45 92 00

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www.axaprivateequity.com

MILANvia Privata Fratelli Gabba n° 1/A20121 Milan - ItalyTel: +39 02 584 42 401

SINGAPORE - ASIA1 Temasek AvenueUnit 20-02A Millenia TowerSingapore 039192 Tel: +65 6513 3410

ZURICHAffolternstrasse 42P.O. Box 69618050 Zurich - SwitzerlandTel: +41 43 299 11 26

VIENNA - EASTERN EUROPEWipplingerstrasse 351010 Wien - AustriaTel: +43 1 537 537 00

2009 annual report axa private equity

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