Commercial Services Exit Activity Increasing

Booz Allen Hamilton raised $238 million in its IPO after pricing 14 million shares of Class A common stock at $17 each, the low end of its expected $17 to $19 price range. Net proceeds from the offering will be used to repay existing debt. Booz Allen Hamilton provides strategic and technology consulting services and has been majority-owned by The Carlyle Group since a $2.55 billion LBO in 2008. The company closed its first day trading on the NYSE under the symbol BAH up at $19.25.

Since the beginning of 2009, PE investors have exited 63 companies in the Commercial Services industry, according to the PitchBook Platform. 2010 has presented PE investors with more favorable exit opportunities than 2009; 39 exits have already been completed, compared to 24 for all of last year. The median exit deal size has also increased, climbing from $103.5 million in 2009 to $170 million in 2010 YTD. Most of these exits have occurred through sales to corporations, which continues to be the exit method of choice, accounting for 59% of 2010 YTD exit activity, but sales to other PE investors has experienced a big jump in popularity, increasing from 12.5% of exits in 2009 to 33.3% in 2010 YTD. However, the activity hasn't been limited to selling. 271 PE investors have made new investments in the industry since the start of 2009. The most active include H.I.G. Capital (8 deals) and Bain Capital (7).