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Trend Reports

2012 Full Year

 
 

2012 l Full Year l Trends Report l Software Industry

Thursday, January 03, 2013

2012 Key Highlights

  • The most active private equity acquirer in the Software Industry in 2012 was Vista Equity Partners with 12 transactions.
  • The segment with the largest disclosed median revenue multiple was Infrastructure Software at 2.7x revenue.
  • There were 228 financially sponsored transactions with an aggregate value of $19.31 billion, representing 15 percent of the total volume and 27 percent of the total value, respectively.

2012 Key Trends

  • Total transaction volume in 2012 increased by one percent over 2011, from 1,515 to 1,537.
  • Total transaction value in 2012 fell by 15 percent over 2011, from $80.81 billion to $68.52 billion.
  • The median revenue multiple moved slightly from 2.2x in 2011 to 2.1x in 2012. The median EBITDA multiple declined from 12.9x to 11.9x.

M&A Market Overview

Berkery Noyes tracked 4,402 transactions between 2010 and 2012, of which 1,490 disclosed financial terms, and calculated the aggregate transaction value to be $172.79 billion. Based on known transaction values, we project values of 2,912 undisclosed transactions to be $43.66 billion, totaling $216.46 billion worth of transactions tracked over the past three years.

One area that experienced continuous growth in the Niche Software segment over the past three years was the retail subsector, which included a 35 percent increase in M&A activity from 2011 to 2012. The largest announced transaction in this subsector over the past three years was RedPrairie Corporation’s acquisition of JDA Software Group, a supply chain management deal, for $1.80 billion in 2012.

The most active acquirer by volume in the Software Industry between 2010 and 2012, either directly or through an affiliated business, was Google Inc. with 49 transactions. 10 of these occurred in 2012: Incentive Targeting, Viewdle, Inc., Nik Software, VirusTotal, Wildfire Interactive, Inc., Sparrow, Quickoffice Inc., Meebo, TxVia, Inc., and Milk Inc.



 

Transaction Volume/Value & Multiples

Transactional Analysis

Strategic vs. Financial Comparison

Purchaser Analysis

Transaction By Volume Segment

Footnotes