Private equity value gained 22 percent on a quarterly basis, from $20 billion to $24.4 billion. When compared to the first quarter, deal value nearly quadrupled. Of note, seven of the industry’s top ten highest value deals year-to-date occurred in the third quarter. These seven deals combined rep-resented almost one-half of the industry’s aggregate value thus far in 2015
The industry’s largest strategic transaction in third quarter 2015 and year-to-date was TPG Capital and Leonard Green Capital Partners’ announced acquisition of Ellucian for $3.5 billion. Providing some more historical background, Hellman & Friedman acquired SunGard Higher Education from SunGard Data Systems for $1.8 billion in 2011. This resulted in a merger under a new holding company with Datatel, which was rebranded as Ellucian.
The Healthcare IT segment experienced a 17 percent volume decline over the past quarter. This followed a 43 percent increase in the second quarter, which was the segment’s peak throughout the past seven quarters. In addition, Healthcare IT volume improved 15 percent when compared to the corresponding time period in 2014.
Deal volume declined two percent over the past three months. This followed a seven percent increase from first to second quarter 2015, which was the industry’s peak for volume throughout the past seven quarters. Aggregate value gained 13 percent, from $65.9 billion in second quarter 2015 to $74.5 billion in third quarter 2015.
There was an 18 percent year-over year volume increase in the Insurance segment, from 39 to 46 deals. The segment’s largest transaction in third quarter 2015 was Vista Equity Partners’ announced acquisition of Solera Holdings for $5.8 billion. Solera provides risk and asset management software and services to the automotive and property marketplace, which includes the property and casualty (P&C) insurance sector.
Transaction volume in the Communications segment improved 42 percent on a quarterly basis. One notable acquirer was Blackberry with the acquisition of Good Technology, a mobile security solutions business, for $425 million. Blackberry completed another industry deal in the first quarter with the acquisition of WatchDox, an enterprise document security company.
The B2B Publishing and Information segment experienced a 38 percent improvement on a quarter-to-quarter basis, from 39 to 54 deals. Strategic acquirers were responsible for 85 percent of the segment’s volume year-to-date, as opposed to 72 percent of volume throughout the first three quarters of 2014. The largest B2B deal in third quarter 2015 was McGraw Hill Financial’s acquisition of SNL Financial, a news, data, and analysis provider, for $2.2 billion.
Aggregate value rose 24 percent relative to the previous quarter, from $33.8 billion to $41.7 billion. Of note, four of the highest value software transactions year-to-date occurred in the third quarter, three of which were backed by financial sponsors.
As for the Media and Marketing horizontal, private equity transaction value increased from 16 percent to 30 percent of total value. Notable secondary buyouts in first half 2015 included GTCR and Adams Outdoor Advertising’s acquisition of Fairway Outdoor Advertising from Acon Investments for $575 million; Capmark Financial Group’s acquisition of Orchard Brands from Golden Gate Capital for $410 million; and Providence Equity Partners’ acquisition of Clarion Events from Veronis Suhler Stevenson for $307 million.
Deal volume in the K-12 Media and Tech segment increased 39 percent in first half 2015. Notable transactions included Houghton Mifflin’s acquisition of Scholastic Corporation’s Education and Technology Services business for $575 million; and Pearson’s sale of Powerschool, a web-based K-12 student information system, to Vista Equity Partners for $350 million.
Clothing manufacturer Under Armour was a notable Consumer Health acquirer with two mobile-based acquisitions in first half 2015 relating to digital health data, nutrition information, and fitness tracking. Along these lines, Under Armour acquired MyFitnessPal for $475 million and Endomondo for $85 million. These two transactions will build upon Under Armour’s previous acquisition of MapMyFitness for $150 million in 2013.
The segment with the largest increase in volume during first half 2015 was Capital Markets with a 31 percent rise, from 58 to 76 deals. Four of the top ten deals also occurred in the Capital Markets segment. The overall industry’s decrease in volume over the past six months was attributable in major part to a 41 percent decline in the Payments segment. This came in the aftermath of a 46 percent increase in second half 2014, which was the segment’s highest point over the past two-and-a-half years.
Total transaction volume rose five percent since second half 2014. Aggregate value was nearly flat at $112.63 billion. Of note, the peak for volume throughout the past two-and-a-half years occurred in first half 2015, whereas value reached its zenith in first half 2014. The industry’s largest transaction in first half 2015 was Permira and CPP Investment Board’s acquisition of Informatica, a provider of enterprise data integration software and services, for $4.77 billion.
Deal activity in the Exhibitions, Conferences, and Seminars segment saw a twelve percent improvement, from 43 to 48 transactions. This was the segment’s fourth consecutive half year increase and its peak for volume over the last 30 months. Also of note, private equity backed deals in the segment nearly quintupled between second half 2014 and first half 2015, from four to 19 acquisitions.
Five of the industry’s top ten largest acquisitions year-to-date were E-Commerce related. As for specific subsectors, notable deals in the online food delivery market included Just Eat’s acquisition of Menulog Group for $687 million; Delivery Hero’s acquisition of Yemeksepeti for $589 million; and Yelp’s acquisition of Eat24 for $134 million.
Deals in first half 2015 with enterprise values above $160 million received a median revenue multiple of 3.8x and median EBITDA multiple of 25.1x, whereas those in the $10-$20 million range had a median revenue multiple of 2.4x and median EBITDA multiple of 13.4x.
The industry’s largest transaction in Q1 2015 was Verisk Analytics’ acquisition of Wood Mackenzie. The data analytics and research firm, which focuses on the oil, gas, and mining market, was acquired for $2.8 billion. This marked an exit for private equity firm Hellman & Friedman, which acquired Wood Mackenzie in 2012 for $1.1 billion.
Total volume in the B2B Publishing and Information segment decreased 25 percent on a quarter-to-quarter basis. This followed a 24 percent rise in Q4 2014, which was its peak throughout the past five quarters. Notable deals in the B2B segment during Q1 2015 included Nielsen’s acquisition of eXelate, a data technology company in the programmatic advertising space, for an estimated $200 million and Dun & Bradstreet’s acquisition of NetProspex, a B2B data services and data management provider, for $125 million.
Deal volume in the consumer application subsector increased 18 percent on a quarterly basis, from 57 to 67. In terms of notable new mobile-based acquirers, technology and transportation company Uber acquired deCarta, a mapping and local search platform. With this transaction, Uber might be looking to move away from Google Maps and other external products as Google potentially seeks to launch its own driving service at some point. Another high profile deal in this space was Ola’s acquisition of taxi rental aggregator TaxiforSure for $200 million.
The number of deals throughout the past five quarters reached its peak in Q2 2014, whereas aggregate value reached its zenith in Q1 2014. When compared to the same time period in 2014, volume in Q1 2015 increased eight percent. The industry’s largest private equity backed deal year-to-date was Bain Capital’s acquisition of enterprise security company Blue Coat Systems for $2.4 billion. This was the only Infrastructure Software deal in the list of top ten largest transactions in Q1 2015.
Four of the Information Industry’s top ten highest value private equity backed deals in 2014 were based in the Media and Marketing horizontal. These four deals, with a combined value of $9.73 billion, represented almost one-fifth of aggregate private equity transaction value. In addition, the number of financially sponsored Media and Marketing deals increased 35 percent, from 156 to 211 transactions.
Deal volume in the combined Professional Training Services and Technology segments increased 19 percent from 2013 to 2014. One notable transaction in the Professional Training segments in 2014 was media company Bertelsmann’s acquisition of Relias Learning, a Software-as-a-Service (SaaS) e-learning solutions and course content provider that serves the healthcare and senior care market, for a reported $540 million.
As for financial sponsors, the number of deals increased 26 percent, from 84 to 106. Vista Equity Partners was responsible for the industry’s largest private equity deal in 2014 with the acquisition of Advanced Computer Software Group for $1.11 billion. Advanced Computer Software Group offers patient management software to healthcare providers, back-office systems for businesses, and outsourced information technology services.
Transaction volume in the Capital Markets segment fell nine percent throughout the past year. This followed a 17 percent improvement from 2012 to 2013. In terms of value, four of the industry’s top ten largest deals in 2014 occurred in the segment. The largest Capital Markets transaction during the year was Centerbridge Capital Partners’ acquisition of IPC Information Systems, a provider of trading communication technology, for $1.2 billion.
Regarding the three horizontal markets in the report, volume in the Media & Marketing portion of the Information Industry remained nearly constant. However, its value increased 22 percent, from $75.22 billion to $91.45 billion. Of note, the Marketing segment’s value more than tripled over the past year. There were four Marketing transactions above $2 billion in 2014, compared to one such deal in 2013.
The segment with the largest increase in volume was Communications with a 24 percent rise. Of note, four of the ten largest deals in the Communications segment involved consumer mobile applications. Three of these were messaging applications: Facebook’s acquisition of WhatsApp for $19.65 billion, Rakuten’s acquisition of Viber for $900 million, and New Call Telecom’s acquisition of Nimbuzz for $175 million.
Transaction activity in the Entertainment segment increased five percent between 2013 and 2014. Four of the ten largest deals in the Entertainment segment were gaming related transactions. Notable related deals included Microsoft’s acquisition of Mojang, the developer studio that created the video game Minecraft, for $2.5 billion; Amazon’s acquisition of Twitch Interactive for $970 million; Churchill Downs’ acquisition of Big Fish Games for $485 million; and Zynga’s acquisition of NaturalMotion Games for $477 million.
Four of the top ten highest value deals in 2014 occurred in the Business Software segment, which consists of software designed for general business practices and not specific industry markets, making it the best represented segment in the top ten list. Business Software also had the largest rise in deal volume on a year-over-year basis with a 20 percent improvement, from 343 to 410 transactions.
The number of transactions involving an online component has continued to rise over the years, from 51 percent in 2011 to 59 percent in 2014 year-to-date. There has been a sizable increase in median multiples during this period as well. The median revenue multiple over the past 45 months improved from 1.8x to 2.4x, while the median EBITDA multiple increased from 9.1x to 12.4x.
The highest value transaction across the industry’s tech-based segments in third quarter 2014 was Heartland Payment Systems’ acquisition of TouchNet Information Systems. The provider of payments and integrated commerce solutions to the Higher-Ed market was acquired for $360 million. Heartland Payments Systems completed another industry deal in second quarter 2014 with the acquisition of MCS Software, a foodservice point-of-sale and online payment solutions company that serves K-12 schools.
Total transaction value more than doubled during the past three months, from $3.2 billion to $7.0 billion. This was the peak for value throughout the seven quarters examined in the report. Also of note, the industry’s three highest value transactions year-to-date occurred in third quarter 2014.
Regarding volume, the number of deals in the Payments segment underwent a 23 percent quarter-to-quarter increase. One notable transaction involving the Europay, MasterCard, and Visa (EMV) standards in third quarter 2014 was ACI Worldwide’s $113 million acquisition of Retail Decisions (ReD), an e-commerce and fraud prevention company that serves the payments market.
The largest transaction in third quarter 2014 was SAP’s acquisition of Concur Technologies, a provider of travel and expense management solutions, for $7.6 billion. This followed SAP’s acquisition earlier in the year of Fieldglass, a provider of vendor management software that helps companies manage contingent labor. SAP has completed several notable cloud-based acquisitions in the workforce management space over the past few years, such as Ariba for $4.4 billion in 2012 and SuccessFactors for $3.3 billion in 2011.
Major players in the travel sector have been active Online and Mobile acquirers thus far in 2014. This included Expedia’s third quarter acquisition of Wotif Group, an Australian based operator of online travel brands in the Asia-Pacific region, for $499 million. Another notable transaction in the sector was TripAdvisor’s acquisition of Viator for $200 million, which was TripAdvisor’s fourth industry transaction year-to-date and the largest deal ever completed by the company.
Transaction activity in the Marketing segment year-to-date rose seven percent compared to the corresponding timeframe in 2013. The largest Marketing deal in third quarter 2014 was Alliance Data Systems’ acquisition of Conversant for $2.3 billion. The B2B Publishing and Information segment saw volume stay about the same on a quarter-to-quarter basis. Financial sponsors were responsible for 28 percent of the B2B volume year-to-date, as opposed to 14 percent of volume throughout the first three quarters of 2013.
Deal volume in the Infrastructure Software segment improved nine percent, making it the segment with the largest rise in deal activity. One associated trend has been strong demand in the identity and access management space. Examples in third quarter 2014 included Gemalto’s acquisition of SafeNet for $890 million as well as IBM’s acquisitions of Lighthouse Security Group and CrossIdeas.
The peak for private equity transaction volume and value during the past two-and-a-half years occurred in first half 2014. In terms of specific verticals, Providence Equity Partners was the industry’s most active Education acquirer with five transactions in the space year-to-date. Meanwhile, Thomas H. Lee Partners, Symphony Technology Group, and Vestar Capital Partners were the industry’s most active Healthcare acquirers with three such transactions in first half 2014.
There were two transactions in the Education market that reached the $1 billion threshold during first half 2014, both of which were backed by private equity firms. This consisted of Charterhouse Capital Partners’ $2.3 billion acquisition of SkillSoft, which provides cloud-based learning solutions for enterprises and governments; and Hellman & Friedman’s $1.1 billion acquisition of Renaissance Learning, a K-12 assessment and analytics company.
Deal volume in the Healthcare IT segment improved 17 percent, from 65 to 76 transactions. This was the segment’s largest increase on a half year basis throughout the past two-and-a-half years. Notable Healthcare IT deals during first half 2014 included Summit Partners’ acquisition of Ability Network for $550 million, Xerox’s acquisition of ISG Holdings for $225 million, and Emdeon’s acquisition of Capario for $115 million.
When compared to first half 2013, the overall industry’s volume increased six percent and value stayed about the same. The peak for volume throughout the past 30 months occurred in second half 2013. In terms of transaction value, six of the industry’s top ten largest deals year-to-date were Payments related.
Regarding the three horizontal markets covered in the report, Online and Mobile transaction volume increased seven percent. The segment with the largest rise in Online and Mobile volume was Communications with a 27 percent increase. Two of the Communications segment’s three largest deals in first half 2014 were located in the consumer mobile application subsector. This consisted of Facebook’s acquisition of WhatsApp for $16 billion and Rakuten’s acquisition of Viber for $900 million.
The most active segment year-to-date was E-Marketing & Search with 336 transactions, which represented a 17 percent increase over the past six months. One notable acquirer in the segment was private equity firm GTCR, which acquired Vocus for $352 million and Cision for $164 million.
Deal flow in the Internet Media segment decreased eight percent relative to second half 2013. However, total value in the segment gained 41 percent. Notable Internet Media transactions in first half 2014 included Hellman & Friedman’s acquisition of Internet Brands for $1.1 billion and YouTube’s acquisition of Twitch Interactive for a reported $1 billion.
As for software used within specific vertical industries or “Niche Software,” transaction volume increased 13 percent, making it the fastest growing market over the past six months. The segment’s largest deal in first half 2014 was Oracle’s $4.4 billion acquisition of MICROS Systems, a provider of point-of sale (POS) and other integrated solutions for the hospitality and retail sectors.
The Online and Mobile portion of the Information Industry saw a six percent increase in volume. This included a 16 percent rise in the E-Marketing and Search segment, from 147 to 171 transactions. Lithium Technologies’ $200 million acquisition of Klout, which measures social media engagement, was one example of acquirers showing interest in social graphing technologies.
SaaS & Cloud deal volume improved nine percent. This followed a 15 percent decline in Q4 2013. Also of note, deal volume in the E-Marketing & Search segment surpassed the SaaS & Cloud segment for the second consecutive quarter.
M&A activity in the Entertainment Content segment increased 14 percent in Q1 2014. The largest Entertainment deal during the quarter was The Walt Disney Company’s acquisition of Maker Studios for $500 million, as Disney looks to strengthen its online video network. This transaction also includes a potential earn-out of $450 million, bringing its total enterprise value to $950 million.
One notable occurrence was the rise in overall value compared to the same time period last year. There were eight software transactions above the $500 million threshold in Q1 2014, compared to one such deal in Q1 2013.
In terms of specific sectors in the Information Industry, TA Associates was the Finance vertical’s most active acquirer in 2013 with six transactions. Meanwhile, TPG Capital was the Healthcare vertical’s most active acquirer with eight transactions.
As for specific market segments in the report, Higher-Ed Media and Tech deal activity saw an 11 percent improvement between 2012 and 2013. At the same time, the number of transactions in the K-12 Media and Tech segment increased six percent.
Healthcare IT as a percentage of the industry’s total deal volume stayed the same at almost 40 percent. As for deal activity in the space, Constellation Software was the segment’s most active acquirer with five transactions in 2013.
Financial sponsors accounted for 18 percent of transaction volume in 2013, which was about the same as in 2012. However, private equity deal value rose from 19 percent to 40 percent of the industry's overall value. This included five of the top ten largest deals in 2013.
Of note, the Broadcasting segment within the Media and Marketing horizontal saw a decline in volume but a sizeable rise in value. Broadcasting deal value more than tripled, from $3.95 billion to $13.34 billion. This was due in part to several acquisitions by Sinclair Broadcast Group.
Transaction volume in the E-Commerce segment increased nine percent over the past year. One notable E-Commerce deal was Groupon’s acquisition of Ticket Monster from LivingSocial for $241 million. This divestiture reflects LivingSocial’s strategic focus beyond the daily deals subsector.
Strategic acquirers accounted for 91 percent of the industry’s deal volume in 2013, an increase of five percent relative to 2012. M&A activity in the Marketing segment stayed about the same, with a total of 536 transactions in 2013. One growth area in the segment was the market research subset, which saw volume rise 61 percent, from 44 to 71 deals.
The Business Software segment underwent a three percent increase in volume on a year-to-year basis. The largest financially sponsored deal in the segment was Advent International's announced acquisition of Unit4 in the enterprise resource planning (ERP) subsector. This transaction, with a purchase price of $1.71 billion, represented a 2.7x revenue multiple and 18.5x EBITDA multiple.
After falling 50 percent between first and second quarter 2013, secondary buyout volume improved almost fourfold over the past three months. Meanwhile, private equity firms as sellers represented 45 percent of transaction volume during the quarter, an increase of 10 percent when compared to the industry’s historical average since 2012.
Regarding some of the market segments covered in the report, M&A activity in the Childcare Services segment improved 50 percent on a quarter-to-quarter basis. Meanwhile, deal volume in the Professional Training Institutions segment year-to-date increased 23 percent relative to the corresponding timeframe in 2012.
The Healthcare IT segment underwent a 56 percent volume increase on a quarterly basis. It also accounted for nearly half of the industry’s aggregate M&A volume, as opposed to 31 percent in the prior quarter. Deal volume in the Pharma IT segment increased 33 percent year-to-date when compared to the corresponding period in 2012.
As for the Payments segment, M&A volume experienced a 142 percent increase in the quarter, with a total of 29 deals. This came in the aftermath of a 50 percent decrease between first and second quarter 2013. Regarding strategic acquirers, the segment’s highest value transaction in third quarter 2013 was EBay’s acquisition of Braintree Payment Solutions for $800 million.
There was a 15 percent volume increase in the Financial Services & Accounting segment, as well as a 46 percent corresponding gain in value. Five of the segment’s ten highest value deals thus far in 2013 occurred in the third quarter. The largest of the five transactions was Davis + Henderson Corporation’s acquisition of Harland Financial Solutions for $1.2 billion.
There were two high profile mobile advertising transactions during the quarter, each of which highlights the growing interest in real-time bidding solutions. Within this subset, Twitter acquired mobile ad serving platform MoPub for an estimated $350 million while Millennial Media acquired mobile ad network Jumptap for $239 million.
M&A volume in the Consumer Publishing segment increased 27 percent in third quarter 2013. There were several notable newspaper transactions during the quarter that were completed by individual billionaires. This included Jeffrey Bezos' acquisition of The Washington Post Company for $250 million and John Henry's acquisition of The Boston Globe from The New York Times for $70 million.
In terms of “Niche Software,” which is targeted to specific vertical industries, volume increased 15 percent on a quarterly basis. The most active acquirer in the segment thus far in 2013 was Constellation Software with 11 deals, including two during the past quarter.
Financial sponsors in the industry’s horizontal Software market accounted for 43 percent of deal value in first half 2013, compared to just 23 percent in first half 2012. BMC Software’s announced acquisition by a private investor group for $6.81 billion was the highest value deal in the Information Industry over the last 30 months.
Private equity firms represented 24 percent of transaction volume in first half 2013. Vista Equity Partners was the most active financial sponsor in the Education Industry, completing 12 transactions throughout the last two-and-a-half years covered in the report.
The largest Pharma IT transaction backed by a financial sponsor in first half 2013 was JLL Partners’ acquisition of BioClinica, a provider of clinical trial management solutions, for $105 million.
The segment with the largest half-to-half year increase in volume was Insurance, which rose 42 percent in first half 2013. One notable deal in the segment in first half 2013 was CoreLogic’s $78 million acquisition of CDS Business Mapping, which supplies digital mapping solutions to the property and casualty insurance sector through its RiskMeter Online platform.
The peak for transaction volume during the past two-and-a-half years occurred in first half 2012, whereas value reached its zenith in first half 2011.The number of deals involving consumer mobile applications increased 28 percent over the past six months, totaling 64 transactions in first half 2013.
As for the E-Marketing & Search segment, volume increased 17 percent on a half-to-half year basis. The largest transaction in first half 2013, both in the overall industry and the E-Marketing segment, was Salesforce.com’s acquisition of digital marketing provider ExactTarget for $2.25 billion.
Consumer Publishing had the largest half-to-half year rise in volume, increasing 21 percent since second half 2012. At the same time, M&A volume in the Entertainment segment improved 11 percent. The amount of deals in the B2B Publishing and Information segment underwent a slight uptick, rising from 86 to 90 transactions in the prior half year period.
Four of the industry's top ten highest value transactions in first half 2013 were completed by private equity firms. In the cyber security subset, Vista Equity Partners' acquisition of Websense for $942 million was the largest deal backed by a financial sponsor since 2011, when Thoma Bravo acquired Blue Coat Systems for $1.15 billion.
Private equity acquirers accounted for 13 percent of the industry’s transaction volume in year-to-date, which was nearly the same as in Q4 2012. Mobile related transactions in the Information Industry rose 33 percent in Q1 2013. Notable acquirers in the mobile geo-location subset included Apple’s acquisition of WifiSlam and Groupon’s acquisition of Glassmap.
The SaaS/ASP segment experienced the largest quarterly rise in volume, improving 16 percent. Transaction volume in the E-Commerce segment increased six percent between Q4 2012 and Q1 2013. As for the E-Marketing & Search segment, M&A activity increased nine percent in Q1 2013.
Transaction volume in the B2B Publishing segment increased ten percent on a quarter-to-quarter basis. M&A in the Consumer Publishing segment, after increasing 67 percent in Q4 2012, fell 13 percent in Q1 2013.
The top ten largest transactions accounted for 41 percent of the industry’s aggregate value in Q1 2013, compared to 60 percent in Q1 2012. Cisco completed one of the industry’s largest deals in the quarter, acquiring Intucell for $475 million.
Although no private equity information deals met the $3 billion threshold in 2011, there were three such acquisitions in 2012. The Carlyle Group was involved in two these transactions, making it the largest private equity acquirer for the year.
The two highest value education deals in 2012 both occurred in the fourth quarter. This consisted of the announced sale of McGraw-Hill Education to Apollo Global Management for $2.62 billion and Pearson’s acquisition of Embanet Compass for $650 million.
M&A activity in the Payments segment improved at a robust pace in 2012, rising 41 percent from 2011. With this growth, Payments had a slight edge over Capital Markets as the most active segment in the report on a year-to-year basis.
Deal value in the Information Industry decreased 10 percent on a yearly basis, from $171.41 billion in 2011 to $153.53 billion in 2012. The median revenue remained nearly constant at 1.9x, while the median EBITDA multiple declined from 11.5x to 10.0x. Four of the report’s top ten highest value transactions in 2012 were backed by financial sponsors, compared to two in 2011.
The Healthcare IT segment in 2012 saw an 11 percent increase in deal flow and accounted for 41 percent of the industry’s overall transaction volume. The segment had a median revenue multiple of 1.8x and a median EBITDA multiple of 9.6x. Transaction volume in the industry’s revenue cycle management subsector increased 37 percent from 2011 to 2012.
In the mobile application subsector, the number of transactions increased 18 percent over the past year. Transactions involving mobile consumer applications increased 34 percent, from 121 to 162, whereas those pertaining to mobile business applications rose seven percent, from 158 to 169.
Transaction volume specifically within the Exhibitions, Conferences, and Seminars segment increased 82 percent compared to 2011. Meanwhile, M&A activity in the Entertainment Content segment improved 18 percent from 2011 to 2012. This was driven in part by film studio related transactions, which increased 42 percent throughout the last twelve months.
Regarding financially sponsored transactions within the Software Industry, there was a 19 percent rise in deal flow compared to 2011 and a 38 percent improvement relative to 2010. This included a 76 percent increase for private equity acquisitions in the Healthcare vertical for 2012.
There was a significant rise in the number of secondary buyout deals throughout the first three quarters of 2012. This portion of the market, which consists of portfolio companies being sold between private equity firms, underwent a 17 percent increase relative to the corresponding period in 2011. In addition, secondary buyout volume thus far in 2012 has increased 55 percent when contrasted with the first three quarters of 2010.
Strategic acquirers in the Education Industry were responsible for 68 percent of transaction volume year-to-date, as opposed to 77 percent during the same timeframe in 2011. Meanwhile, private equity acquirers have accounted for 59 percent of transaction value thus far in 2012, including two of the largest deals in the third quarter.
M&A in the Capital Markets segment, after increasing 76 percent from first to second quarter 2012, leveled-off 13 percent in the third quarter. The largest Capital Markets transaction in third quarter 2012, and the second largest year-to-date, was Thomson Reuters’ announced acquisition of FXall for $557 million.
Healthcare Business Services experienced a rise in volume, gaining 20 percent from second to third quarter 2012. The number of transactions in the Medical Information segment more than doubled within the same timeframe. Meanwhile, private equity in the Healthcare IT segment was responsible for 23 percent of transaction volume but 54 percent of value through third quarter 2012.
One area in the report that experienced especially strong growth involved geographic information system (GIS) technology. Combined volume in the GIS, geography, geospatial, and geolocation sectors improved 50 percent on a quarterly basis. The largest related transaction in the last two years, DigitalGlobe’s announced merger with GeoEye for $900 million, occurred in third quarter 2012.
E-Content transaction volume increased 13 percent, making it the segment with the largest quarterly rise. Meanwhile, transactions in the report involving consumer mobile apps showed a robust level of activity, rising 42 percent on a quarterly basis.
Private equity acquirers accounted for 12 percent of transaction volume but 31 percent of aggregate value. The Carlyle Group’s announced acquisition of Getty Images from Hellman & Friedman for $3.3 billion in third quarter 2012 was the largest private equity backed transaction in the report.
In terms of subsector areas of growth within the Infrastructure Software segment, M&A pertaining to development application software tools increased 36 percent relative to the last quarter. This is occurring, in part, due to the more widespread adoption of both agile software development and DevOps.
Financially sponsored transactions specifically within the Software portion of the Information Industry, after remaining flat throughout 2011, increased 15 percent during the last six months. Three of the top ten overall Software deals in first half 2012 were backed by private equity firms.
Despite the constant overall deal flow, the Corporate and Professional Training segment experienced a 32 percent increase in volume. CAE’s acquisition of Oxford Aviation Academy (OAA) for $315 million, a subsidiary of STAR Capital Partners Limited, was the highest value transaction in the segment.
Verisk Analytics' announced acquisition of MediConnect Global for $324 million was one of the largest transactions in the Healthcare IT segment, which underwent a 23 percent increase in volume compared to second half 2011.
The Payments segment experienced a 30 percent volume increase in the segment compared to first half 2011. The most active associated buyer during the last two and a half years was VeriFone, a provider of point-of-sale electronic payments solutions, with six transactions.
The Energy segment – which primarily includes Software companies that service electricity, fossil fuel, alternative energy, and energy utility companies – improved 61 percent in first half 2012, making it the segment with the largest increase in volume.
Transaction volume in social media marketing, examined as a subset of the E-Marketing & Search segment, increased fourfold compared to first half 2011 and 30 percent relative to the prior half year period.
M&A in the Consumer Software segment increased 29 percent compared to first half 2011, making it the fastest growing segment on a half-to-half year basis.
Marketing was the most active industry segment for first half 2012, accounting for 262 transactions and surpassing Internet Media in transaction volume during the last twelve months.
Compared to Q4 2011, there was a 53 percent increase in M&A activity pertaining to companies involved with document and data management, web analytics, and business intelligence. One of the largest transactions in this space was Insight Venture Partners’ announced acquisition of Quest Software for $1.8 billion.
The top ten notable transactions list was dominated by the SaaS/ASP segment, which accounted for five of the largest deals. The only top ten E-Marketing and Search transaction in Q1 2012 was Singapore Telecommunications’ announced acquisition of Amobee for $321 million.
Transaction volume in the Media and Marketing Industry improved seven percent. The Marketing segment, which saw overall deal activity rise 13 percent, was bolstered by Digital Marketing’s 68 percent rise in volume. With 99 transactions, Internet Media M&A volume remained constant compared to the previous quarter. Nonetheless, one area of the Internet Media segment – online shopping guides – saw a 43 percent increase in volume.
Q1 2012 transaction value in the Software Industry increased 10 percent, whereas transaction volume declined 10 percent compared to the previous quarter. The largest financial software deal for the quarter was Vista Equity Partners’ announced acquisition of Misys for $2 billion. M&A relating to security was responsible for 30 percent of infrastructure software deals in the quarter, compared to 15 percent in Q4 2011.
Kohlberg Kravis Roberts & Co., Technology Crossover Ventures and Silver Lake Partners’s announced acquisition of GoDaddy. com was the largest transaction for 2011, with an acquisition price of $2.25 billion. The median revenue multiple remained nearly the same, going from 1.7x in 2010 to 1.8x in 2011, while the median EBITDA multiple decreased from 10.2x to 9.1x.
The most active acquirer for 2011 in the Information Industry was Google with 25 acquisitions, including 5 in the Fourth Quarter: Clever Sense, RightsFlow, Apture, Katango, and SocialGrapple. Overall, Google had 58 Information acquisitions from 2009 to 2011. The median revenue multiple increased from 1.7x in 2010 to 2.1x in 2011, while the median EBITDA multiple increased from 10.5x to 12.0x. Total transaction volume in 2011 increased by 17 percent over 2010, from 2639 to 3098.
Providence Equity Partners’ acquisition of Blackboard for $1.71 billion, completed in the third quarter of 2011, was the second largest Education deal in 2011. This transaction exemplifies how interactive learning and the evolving delivery of content are changing the Education marketplace. One of the most prolific acquirers by value between 2009 and 2011 was Providence Equity Partners, with a combined total of over $3 billion in the industry.
Based on value, the most active market segment that Berkery Noyes tracked between 2009 and 2011 was Healthcare IT with $10.25 billion worth of transactions. Median revenue and EBITDA multiples fell from 2010 to 2011. The median revenue multiple decreased from 2.0x to 1.6x, while the median EBITDA multiple went from 11.6x to 9.0x. Although total transaction value declined 9 percent over the last twelve months, total transaction volume increased 15 percent, from 255 to 292 this year.
The median revenue multiple increased from 2.2x in 2010 to 2.6x in 2011. Although transaction volume gained only 2 percent, transaction value increased 43 percent over 2010, from $20.52 billion to $29.78 billion. There has been a consistent improvement in the number of Capital Markets transactions, which was the only segment that saw an increase from 2010 to 2011.
Microsoft Corporation’s acquisition of Skype Technologies SA, a portfolio of Silver Lake Partners, was the largest transaction for 2011, with an acquisition price of $9.08 billion. There were 1531 strategic transactions, an increase of 33 percent compared to 2010. In addition, median revenue and EBITDA multiples increased from 2010 to 2011. The median revenue multiple went from 1.9x to 2.4x, a 26 percent rise, while the median EBITDA multiple increased from 11.4x to 12.5x.
There were 199 financially sponsored transactions with an aggregate value of $22.40 billion, representing 14 percent of the total volume and 26 percent of the total value, respectively. Total transaction volume in 2011 increased by 10 percent over 2010, from 1313 in 2010 to 1450 this year.
The largest announced transaction for 2011 was West Australian Newspapers’ acquisition of Seven Media Group, a portfolio company of Kohlberg Kravis Roberts & Co., for $4.15 billion. Transaction value saw a gain of 47 percent over the last twelve months, from $38.51 billion to $54.70 billion. According to Berkery Noyes research, the median revenue multiple went from 1.5x to 1.9x in 2011. The median EBITDA multiple moved slightly from 10.4x to 10.6x, representing a 51 percent increase over 7.0x in 2009.
The most active acquirer through Q3 2011 was Thomas H. Lee Partners with 13 acquisitions, 3 of which occurred in Q3 2011. Median EBITDA multiples from 2010 to the first nine months of 2011 went from 10.7 to 11.0, a 3 percent increase, while median revenue multiples remained the same at 1.8.
Q3 2011 transaction volume increased 6 percent over Q2 2011. Transaction value, meanwhile, decreased 21 percent, indicating a greater number of small and mid-sized deals. Median EBITDA multiples went from 11.9 in Q2 2011 to 13.8 in Q3 2011, a 16 percent increase, and median revenue multiples moved from 2.2 to 2.3.
According to managing director John Guzzo, the increase in the number of closed transactions “is a direct result of an increasingly more active private equity market, overall pent-up supply of companies wishing to sell, and a strategic buyer market that continues to shore-up product suites and customer bases through acquisitions.”
The largest transaction through the 1st 3 Quarters of 2011 was Hellman & Friedman’s announced acquisition of SunGard Higher Education from SunGard Data Systems for $1.78 billion during Q3 2011. This will result in a merger under a new holding company with Datatel, an existing Hellman & Friedman portfolio company.
Transaction value increased 205 percent over the previous quarter, which can be explained by Blackstone Group’s announced acquisition of Emdeon for $3.03 billion.
Median EBITDA multiples rose from 13.0 to 13.8 since Q2 2011, a 6 percent increase, while median revenue multiples went from 2.6 to 2.1, a 19 percent decline. The largest announced transaction for Q3 2011 was Kohlberg Kravis Roberts & Co. and Silver Lake Partners’ acquisition of GoDaddy.com for $2.25 billion.
Transaction value, which increased 179 percent in the second quarter, fell 23 percent. Median EBITDA multiples were nearly unchanged for the quarter at 13.6, as were revenue multiples at 2.3. The largest transaction for the third quarter as well as the 1st 3 Quarters of 2011 was the acquisition of Autonomy by HP for $10.28 billion.
Enterprise value multiples have been rising on a yearly basis for the Media and Marketing Services Industry. Q3 2011 transactions commanded a median EBITDA multiple of 14.5, a 58 percent increase over the previous quarter, and a revenue multiple of 2.2, which continues to be the highest revenue multiple in the last seven quarters.
Transaction volume and aggregate value rose considerably over the 2nd Half of 2010. Transaction volume gained 11 percent in 1st Half 2011, rising to 171, while value rose 21 percent in the first half, reaching $11 billion. Thomas H. Lee Partners also announced the highest valued transaction this half, the pending acquisition of Acosta, Inc., a subsidiary of AEA Investors LP, for $2 billion.
Even in this challenging deal climate, median revenue multiples for the industry have risen for the fourth consecutive half year. Pearson was not only the most active acquirer for 1st Half 2011, but also the most active acquirer in the two and a half years covered in this report, making 17 disclosed transactions.
Reed Elsevier and LLR Partners both announced three transactions this half year, tying as the most active acquirers in the space. While deal volume increased by seven percent to 143 transactions announced this half year, total aggregate deal value fell 28 percent to $3.4 billion from $4.8 billion in 2nd Half 2010. Despite this, both median deal value and median EBITDA multiples rose over the same time period.
Although total transaction volume for the period remained largely unchanged, transaction value nearly tripled, jumping from $7.0 billion in 2nd Half 2010 to $19.5 billion this period. The 187 percent increase can be attributed primarily to Deutsche Börse Group’s announced merger with NYSE Euronext for $12.4 billion.
A strong recovery continued into 1st Half 2011. Median EBITDA multiples rose 50 percent over the six-month period and median revenue multiples increased by 54 percent. Both of these figures represent new highs of the periods analyzed in this report.
Robust growth over the past two and a half years continued across the last six months. Price multiples rose in accordance with this increased activity. 1st Half 2011 transactions commanded a median EBITDA multiple of 15.3 and a revenue multiple of 2.1. Both of these numbers represent 30-month highs for the segment.
Total transaction value was up 68 percent over the previous six months, jumping from $17.3 billion to $28.9 billion. This was due, in large part, to five transactions valued over a billion occurring in 1st Half 2011, while Full Year 2010 saw only four transactions in the billion dollar range.
Median transaction values, revenue multiples, and EBIDTA multiples all made noticeable gains over 2nd Half 2010.
Of note, seven of first quarter’s 10 largest transactions fell into the category of Niche Software, which includes companies in the healthcare, financial services, construction, and energy industries.
Q1 2011 transaction volume exceeded each quarter of 2010 in the Online & Mobile Industry, while aggregate transaction value rose 37 percent over Q4 2010, from $10.5 billion to $14.4 billion.
Internet media reported the largest gain by sector for the quarter, rising over 44% from 63 transactions to 91, as the popularity of media-enabled devices like smart phones and tablets continues to grow.
Aggregate transaction value rose 65 percent, yet it remains lower than the 15 month high of Q3 2010. Transaction volume in Q1 2011 has increased 10 percent over Q4 2010, with the 595 transactions seen this quarter being the highest total of any quarter in the past 15 months.
Large, active financial buyers have focused their acquisitions on adding to existing portfolio companies rather than the acquisition of new, stand alone investments. Indeed, over 80 percent of their transactions have been incorporated into existing investments, where across the acquisition landscape in the Information Industry, the number has been closer to 60 percent.
Median EBITDA and revenue multiples have increased from 2009, with the EBITDA multiple rising 36 percent from 8.1 to 11.0 and the revenue multiple rising 50 percent from 1.2 to 1.9. Total transaction value increased by 81 percent over 2009, from $6.43 billion in 2009 to $11.62 billion in 2010. Total transaction volume also increased, with a 13 percent gain over 2009, from 199 in 2009 to 224 in 2010.
Aggregate deal value increased 49 percent in 2010, from $3.96 billion in 2009 to $5.92 billion in 2010. Median deal value also increased dramatically from 2009. The post secondary technology segment increased from 7 transactions to 20 in 2010, a 186 percent increase. Financial acquirers represented 28 percent of transaction volume but 62 percent of aggregate transaction value.
Both total transaction volume and value saw increases this year. Total transaction volume increased by 30 percent from 183 in 2009 to 238 in 2010. Total transaction value increased by 27 percent from $16.14 billion in 2009 to $20.52 billion in 2010. Capital Markets remained the largest segment by deal volume in 2010, yet only Insurance has made gains in each of the past four years.
Strategic acquirers have been the most common acquirer in the Information Industry. Financially sponsored transactions rose 39 percent by value over 2009 while losing 2 percent in volume over 2009. The median revenue and EBITDA multiple increased over 2009, with the revenue multiple rising to 1.8 and the EBITDA multiple to 11.2, a 29 percent increase over the 8.7 of 2009.
Google was far and away the most active acquirer in the online space, with 22 acquisitions in 2010. Both total transaction volume and value saw increases this year. Total transaction volume increased by 63 percent from 679 in 2009 to 1108 in 2010, while total transaction value increased by 72 percent from $25.95 billion in 2009 to $44.61 billion in 2010.
"For the first time in the 10 years we have been tracking the Software Industry, ASP, SaaS, or Cloud technologies have represented nearly 50% of the acquired companies," said James Berkery, CIO of Berkery Noyes.
The median revenue multiple of transactions in 2010 rose 28%, from 1.4 in 2009 to 1.8 in 2010. The median EBITDA multiple also rose from 6.9 in 2009 to 10.4 in 2010, a 51% increase. In addition, the decrease in transaction value may be more properly attributed to the large deals of 2009 rather than a lackluster 2010.
Median multiples have increased dramatically from Q2 to Q3 2010, with median EBITDA multiples rising 43 percent from 10.5 to 15.1, and median revenue multiples rising 21 percent, from 1.9 to 2.3 from Q2 to Q3 2010.
Deal value, volume and multiples have remained relatively constant from Q2 to Q3 2010, however Thoma Bravo LLP has emerged as the most active acquirer within the information industry, making 9 acquisitions through Q3 2010.
Transaction value has increased 43 percent over Q2 2010 from 48 to 69 transactions in Q3 2010. Multiples have made similar gains, with median EBITDA multiples rising 41 percent from 8.1 to 11.5 and median revenue multiples 58 percent from 1.2 to 1.9.
Transaction volume is up 42 percent, from 36 to 51 transactions, and transaction value is up 302 percent, from $537 million to $2.2 billion worth of acquisitions.
Despite decreased transaction value and volume from Q2 to Q3 2010, the first nine months of 2010 have already surpassed 2009 in transaction value, $16 to $18 billion, and has nearly done so in transaction volume. With 181 transactions in the industry for the full year 2009, 2010 has already seen 175 transactions.
While total transaction volume continues to make modest gains, growing by 11%, total transaction volume grew considerably, from $11.2 to $17.1 billion, a 52 percent increase. The top ten transactions by value in the 1st nine months of 2010 now include 6 from Q3 2010, which may explain the jump in transaction value.
Software saw conservative growth in deal value and deal volume from Q2 2010, yet median multiples have made significant gains over the previous year.
The Media Industry saw an increase in both transaction value and multiples. Deal value increased 80 percent in Q3 over Q2 2010, from $5.2 to $9.4 billion. Median EBITDA multiples rose from 7.0 to 10.5 from 2009 to the first nine months of 2010, a 50 percent increase, and median revenue multiples rose from 1.4 to 1.8 in Q3 2010, a 28 percent increase.
Revenue multiples in the Education Industry continued their strong upward trend, rising 38% to 1.8, which represents a 200% growth from the low of 0.6 in 1st Half 2009. Despite strong growth in revenue multiples, transaction volume decreased for the fifth straight half-year period, falling 14%, from 86 in 2nd Half 2009 to 74 in 1st Half 2010.
Of the top ten transactions by value, three were financially sponsored transactions: Thomas H. Lee Partners, L.P.'s acquisition of inVentiv Health, Inc., for $909 million, Providence Equity Partners' pending acquisition of Virtual Radiologic Corporation for $282 million, and OMERS Private Equity's pending acquisition of Logibec Groupe Informatique Ltd. for $225 million.
The Fintech Industry saw a 31% increase in volume, exceeding the total volume of each of the four preceding sixth month periods. Revenue multiples experienced a 210% half-to-half increase from 2.1 in 2nd Half 2009 to 3.8 in 1st Half 2010. The Payments sector saw a 173% jump in volume from 2nd Half 2009, bolstered by several acquisitions of mobile payment technology companies.
Median revenue multiples for Private Equity M&A fell slightly in 1st Half 2010, from 2.5 to 2.2. However, this number still represents a 100% increase from the revenue multiple low of 1.1 in 1st Half 2009. Private Equity activity saw a 22% increase in volume from 117 transactions in 2nd Half 2009 to 143 transactions in 1st Half 2010.
The Information Industry saw a 21% increase in volume from 2nd Half 2009 to 1st Half 2010, yet total transaction value decreased by 10 percent from $56.62 billion to $51.23 billion during the same period. Despite this decline in aggregate value, median enterprise value has increased 19% from $20 .1 million in 2nd Half 2009 to $28.5 million in 1st Half 2010.
While multiples have decreased from 2.1 in 2nd Half 2009 to 1.8 to 1st Half 2010, the sector nonetheless saw strong growth, as evidenced by a 31% increase in volume. The segment with the largest increase was E-Marketing & Search, with a 40 percent increase from 80 transactions in 2nd Half 2009 to 112 transactions in 1st Half 2010.
Median EBITDA multiples in the Software Industry experienced a 30% increase from 11.3 in 2nd Half 2009 to 14.7 in 1st Half 2010. This is a 42% increase from the low of 8.5 in 1st Half 2009. The proliferation of smartphones, and in particular those with application oriented operating systems, has helped to drive mobile application software to rise 79% from the past half year, from 31 to 59.
The Media Industry saw a 21% increase in volume, which, coupled with a 54% increase in financially sponsored transactions, indicates a strong return from the lows of 1st Half 2009. Revenue multiples experienced a half-to-half gain with a 14% increase in the median enterprise value/revenue multiple, from 1.5 in 2nd Half 2009 to 1.7 in 1st Half 2010.
The largest transaction in the Financial Technology and Information Industry in 2009 was Fidelity National Information Services' acquisition of Metavante Technologies for $2.9 billion, which closed on October 1st. The most active buyer as measured by aggregate volume of transactions was The Carlyle Group with four transactions.
2nd Half 2009 exhibited an increase in both aggregate volume and aggregate value, versus 1st Half 2009. Half-to-half, aggregate value increased 150% from approximately $2 billion to $5 billion, and aggregate volume increased by 15% from 86 deals to 99. The 2nd Half 2009 level of activity, as measured by aggregate value and aggregate volume, is on par with 2nd Half 2007, and slightly below the peak of activity in 1st Half 2008.
Year-to-year, the Information Industry exhibited mixed trends with a volumetric decline but a slight gain in aggregate value. Total transaction volume declined by 22% from 1716 deals in 2008 to 1337 in 2009. Aggregate value increased by 3%, from $82.12 billion in 2008 to $84.31 billion in 2009.
The largest transaction in the Software Industry was Oracle's proposed acquisition of Sun Microsystems, announced April 19, for $7.1 billion. The aforementioned transaction is more than 2.4x the next largest transaction, Fidelity National Information Services' acquisition of Metavante for $2.9 billion, which closed on October 1.
Private Equity M&A activity in the Information Industry experienced a significant half-to-half gain in aggregate value and a slight half-to-half increase in aggregate volume. Aggregate value increased 8 fold from approximately $2 billion in 1st Half 2009 to approximately $16 billion in 2nd Half 2009. In terms of volume, activity increased by 8.3% from 96 deals in 1st Half 2009 to 104 in 2nd Half 2009.
2nd Half 2009 showed promise of stronger M&A markets moving into 2010, as aggregate value increased three-fold, from approximately $1 billion in First Half 2009 to approximately $3 billion during the second half. Seven of the 10 largest deals were announced in August or later, indicating positive signs regarding the debt market's appetite for quality education deals.
Aggregate value increased by 5% from $24.68 billion in 2008 to $25.83 billion in 2009. This increase in value is due in large part to a significant increase in the value of deals done in the E-Marketing & Search segment. The aggregate value of deals done in this segment was $3.21 billion in 2008 and $5.98 billion in 2009, an increase of 86%.
Media Industry M&A activity exhibited mixed trends in 2009 with a volumetric decline but a rise in aggregate deal value. Volume declined by 37% from 700 deals in 2008 to 441 in 2009. However, aggregate deal value increased by 12% from $32.68 billion in 2008 to $36.51 billion in 2009. This rise in overall value for the year is primarily attributable to the Comcast – NBC Universal deal, announced on December 3, which has a transaction value of $13.75 billion.
While private equity investors were responsible for only 15% fewer announced transactions during 1st Half 2009 compared to the same period of last year, the aggregate value of those transactions plummeted by 80%, the likely cause being continued tightness in the credit markets. The data indicates that while PE buyers’ appetite for transactions remains healthy, limited access to leverage has significantly reduced the enterprise values of individual deals.
The ongoing user-driven transition from traditional format to new media, which the industry has had difficulty monetizing, has compounded the effect of the global economic slowdown and resulted in a more marked decline in M&A activity than was seen in other Information industries. One bright spot in the Media Industry was the Entertainment Content segment, where aggregate transaction value grew by 10% during 1st Half 2009 to $612 million, from $557 million in the same period of 2008.
Deal activity in the Software Industry contracted in 1st Half 2009 from levels in the same period of last year. However, the rate of contraction has not been nearly as dramatic as in other Information Industry segments. Total transaction volume in 1st Half 2009 decreased by a modest 10% over 1st Half 2008, from 374 to 336 deals. Total transaction value in 1st Half 2009 decreased by 28% over 1st Half 2008, from $24.46 billion to $17.78 billion.
M&A slowed significantly throughout the Information Industry in 1st Half 2009, as the total number of announced transactions fell by 29% and aggregate value dropped by 45%, compared with the same period in 2008. These trends indicate that while desire to do deals has been tempered, it does exist; but focus has shifted to smaller, strategic transactions.
As expected, deal activity in the Online Industry as a whole has shown severe negative growth. However, in stark contrast to the overall downtrend, the number of transactions for the E-Commerce and Software as a Service (SaaS) segments has remained flat while the aggregate value of E-Commerce transactions specifically has increased by 17% from $2.81 billion in 1st Half 2008 to $3.29 billion in 1st Half 2009.
While the broader economy remains sour, our
engagements with leading strategic investors
and private equity firms indicate that interest
remains extremely strong for education
deals in 2009. Moreover, given the median
size of K-12 deals over the past several years,
tight credit markets should have a limited
impact on most prospective deals. We have
highlighted below three notable investment
themes for 2009.
Berkery Noyes tracked 495 closed
transactions in the global education
industry between 2006 and 2008. Of this
universe, 179 transactions had disclosed
enterprise values, representing $42.63
billion in aggregate value.
Total transaction volume in 2008 decreased by 13 percent over 2007, from 1716 in 2007 to 1485 in 2008. Total transaction value decreased by 70 percent, from $289.07 billion to $85.92 billion.
Disclosed median enterprise value multiples between 2006 and 2008 for all segments combined in this report was 12.34 times EBITDA (earnings before interest, tax, depreciation, and amortization) and 2.01 times revenue.
Despite a weakening economy, 2008 was a solid year for M&A in the pharma and healthcare information and technology industry. The total volume of M&A transactions in the pharma and healthcare information and technology market for 2008 increased to 156 transactions, an increase of 16% over the previous year; however, the total value decreased to just below $9 billion, a decrease of 9%.
The Software Industry’s most active buyers in 2008, based on the number of announced transactions, were Autodesk, Inc. and Oracle Corporation, each with 9 businesses acquired either directly or through a partner or affiliate.
Despite a brutal market sell-off, the failure
of more than a few financial institutions
and the onset of a sharp recession, M&A
activity in the Financial Technology
and Information industry held steady
throughout the 4th Qtr and 2008 as a
whole; at least in terms of the number of
Based on value, the most active market segment between 2006 and 2008 was E-Marketing & Search with $32.49 billion worth of transactions as opposed to the least active segment being Communications with $15.92 billion worth of transactions.
The most active buyer in the Media Industry by way of volume either purchased direct or through partner or affiliated business between 2006 and 2008 with 34 transactions was United Business Media PLC.