New Mountain Capital, LLC (“New Mountain”) Issues “Social Dashboard” Report; Over 17,200 Jobs Added or Created at New Mountain Portfolio Companies; R+D, Software Spending and Capital Expenditures over $2.2 Billion in Aggregate
New York, New York – February 20, 2014 – New Mountain issued its sixth annual “Social Dashboard” today, reporting on key job growth and investment metrics at its private equity portfolio companies through December 31, 2013.
New Mountain is a New York based investment firm founded in 2000 and currently managing approximately $12.0 billion of aggregate capital commitments. The firm’s strategy has consistently emphasized growth and business building in non-cyclical economic sectors, rather than excessive debt, as the best path to high and steady returns. The firm used no third party acquisition debt in the initial purchases of fifteen of its twenty-nine private equity platform investments. New Mountain has never had a private equity portfolio company bankruptcy or business failure. The majority of New Mountain’s investor base is comprised of the retirement plans of some of the nation’s largest states and corporations, national savings plans, and the endowments of leading universities.
A study of all New Mountain past and present private equity portfolio companies shows that employment at New Mountain’s private equity companies increased from 29,814 jobs to 47,104 jobs during the period of New Mountain’s ownership.(i) This is a gain of 17,290 jobs, or approximately a 58% increase in jobs, net of any job losses. A total of 8,071 net new jobs were created through organic growth at the companies, and 9,219 jobs were added through acquisitions.
Of the 17,290 jobs gained, approximately 11,157 were in the United States. As of the end of 2013, 35,909 people were employed by the portfolio companies that New Mountain owned at that time, including 21,856 people in the United States. Median income for these U.S. employees was $52,332 in 2013, or approximately 94% above the $26,989 national individual median income. Average income was $72,198, which is approximately 78% above the U.S. average individual income of $40,563.(ii ) Taken together, the employment level across New Mountain’s portfolio companies would have ranked the firm between the 184th and 185th largest employer in the Fortune 500 at the end of 2013.(iii)
New Mountain’s past or present portfolio companies have invested a total of $2.274 billion in research and development, software development and capital expenditures during the years of the firm’s ownership, with approximately $1.427 billion spent on R&D and software development. $456 million was invested in 2013 alone, including approximately $266 million of R&D spending, $47 million of software development and $143 million of capital expenditures.(iv)
“New Mountain is dedicated to building great businesses,” said Steven B. Klinsky, New Mountain’s Founder and CEO. “As the nation seeks economic growth and creation of high quality jobs, we think private equity (properly executed) can be a very socially positive pursuit and one component of that growth.”
Note: All amounts are based on 2013 unaudited results. New Mountain portfolio companies Validus Re, Paris Re and Tygris (including successor EverBank) are excluded from this analysis as New Mountain owns less than 25% of these companies. New Mountain’s investment in New Mountain Finance Corporation is also excluded from this analysis. Lastly, New Mountain’s investment in Iron Bow was excluded after majority control was sold in 2011.
This document is intended for informational purposes only, and has been prepared with the sole objective of demonstrating New Mountain’s commitment to business-building. It is not to be construed as an offer or a solicitation for the sale of a security, or as an offer to provide any investment advice. An investment with the Partnership or any of its affiliates involves significant potential risks and conflicts of interest and may only be made pursuant to the Partnership’s offering documents, which qualify this letter in its entirety, and which should be read carefully.
i. A company is included in the data set in the year in which New Mountain makes its initial investment. Holding periods for specific portfolio companies are available upon request. After New Mountain exits its investment in a given portfolio company, the job creation figures for that company are held constant across future years. New Mountain does not monitor whether those figures increase or decrease after exit. For Connextions, a portfolio company exited in August 2011, New Mountain kept the employment figures constant as of year end 2010 due to the seasonality of the workforce.
ii. The New Mountain median is the weighted average of the median compensation at each New Mountain portfolio company. U.S. median and average are from the Census Bureau survey (2013) based on 2012 data; found at http://www.census.gov/hhes/www/cpstables/032013/perinc/pinc01_000.htm.
iii. Based on Fortune 500 data found at: http://money.cnn.com/magazines/fortune/fortune500/2013/full_list/index.html?iid=F500_sp_full. New Mountain believes that if all other private equity firms and private corporations were included, New Mountain would likely rank below #185.
iv. A company is included in the data set for any years in which New Mountain has an investment. After New Mountain exits its investment in a given portfolio company, that company’s financial performance is no longer included.
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