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      MERGERS AND ACQUISITIONS UPDATES FROM BERKERY NOYES

    Entries in Acquisitions (149)

    Monday
    May152017

    TRANSACTION ACTIVITY IN THE B2B INFORMATION SEGMENT UNDERGOING A SIGNIFICANT INCREASE

    According to Berkery Noyes’ Media and Marketing report for Q1 2017, industry deal volume underwent a two percent uptick over the past three months. Aggregate value fell from $145 billion to $15.8 billion.

    Of note, two of the industry’s top three highest value acquisitions last year occurred in Q4 2016. This included AT&T’s announced acquisition of Time Warner for $105.3 billion, or $85.4 billion if net debt is excluded. If the Time Warner deal is omitted, value decreased 59 percent, which was about the same decline in value when examined on a year-over-year basis.

    Total volume in the B2B Publishing and Information segment increased 33 percent in Q1 2017. This made it the sector with the largest rise in volume over the past three months. High profile B2B related deals in Q1 2017 included Gartner’s acquisition of CEB Global, a corporate research and advisory firm, for $3.3 billion; and Solera Holdings’ acquisition of Autodata Limited, which provides technical information to the automotive aftermarket, for $422 million.

    Other notable B2B transactions during the quarter were Vitruvian Partners’ acquisition of OAG Worldwide, a provider of flight status and scheduling information, for $215 million in a management buyout from AXIO Data Group; Zoopla Property Group’s acquisition of Hometrack, a provider of residential property market insights and analytics, for $152 million; and Dun & Bradstreet’s acquisition of Avention, a multi-channel platform that offers business information and sales enablement solutions, for $150 million.

    As for other select markets covered in the report, volume in the Internet Media segment increased 18 percent on a quarterly basis. Internet Media also nearly surpassed the Marketing segment as the industry’s most active sector in Q1 2017. The Exhibitions, Conferences and Seminars segment saw volume improve ten percent, which followed a 48 percent rise in Q4 2016. Deal activity in the Consumer Publishing segment fell 22 percent in Q1 2017 but remained about constant year-over-year.

    “Companies that offer events, subscription-based data offerings and/or marketing services, are likely achieving growth and are attractive to both strategic and private equity acquirers,” said Mary Jo Zandy, Managing Director at Berkery Noyes. “New acquirers such as TBG AG, a Zurich-based family office that just announced the acquisition of DTN, the U.S. real-time weather service to the agricultural sector, enter to create a dynamic M&A market. Large strategics’ divestitures of non-core properties and private equity timely exiting portfolio companies, coupled with private company sellers, have fueled this sellers’ market.”

    Monday
    May012017

    SOFTWARE DEAL VOLUME AND VALUE BOTH ON THE RISE

    Berkery Noyes’ Software report for Q1 2017 showed that transaction volume experienced a 16 percent gain over the past three months, with a total of 528 acquisitions in Q1 2017. Overall value rose 75 percent, from $29.4 billion to $51.4 billion. The number of deals throughout the past five quarters reached its peak in Q2 2016, whereas value reached its zenith in Q3 2016.

    Deal volume in the “Niche Software” segment, which is targeted to specific vertical markets, increased 14 percent in Q1 2017. The Niche segment accounted for four of the overall industry’s top ten highest value deals year-to-date. The largest of these transactions was Intel’s announced acquisition of Mobileye, which develops self-driving technologies, for $14.7 billion. The Mobileye acquisition follows several related transactions in 2016 by high profile acquirers such as Uber, General Motors, and Ford.

    Other notable Niche segment deals year-to-date included Vista Equity Partners’ announced acquisition of DH Corporation, a provider of technology solutions to financial institutions, for $3.6 billion, which Vista plans to combine with its portfolio company Misys; McKesson Corporation’s announced acquisition of CoverMyMeds, which offers electronic prior authorization solutions to pharmacies, providers, payers and pharmaceutical manufacturers, for $900 million; and Hexagon’s announced acquisition of MSC Software, a provider of computer-aided engineering (CAE) solutions such as simulation software for manufacturing process development, for $834 million.

    The Business Software segment, which consists of software designed for general business practices and not specific industry markets, saw a 29 percent quarterly increase in volume. The Business segment’s highest value deal in Q1 2017 was Blackstone Group’s announced acquisition of Aon’s technology-enabled and human resources platform for $4.3 billion.

    Other notable Business segment deals year-to-date included Atlassian’s acquisition of Trello, a web-based collaboration software and project management service, for $425 million; and Wolters Kluwer Tax & Accounting’s announced acquisition of Tagetik, which provides corporate performance management solutions and services to mid and large sized corporations, for $317 million.

    “No matter the business the human capital element exists, thus acquirers across a wide spectrum are showing strong interest in workforce management, recruiting, training, performance reporting, compensation and other functions,” said Sameer Pal, Managing Director at Berkery Noyes. “Employers increasingly recognize there are enormous direct and indirect costs to turnover and addressing that spans the entire employee lifecycle. Technology enablement around the critical needs of finding, hiring, and retaining qualified personnel allows companies to deal with these areas holistically.” Pal continued, “Additionally, given the ongoing proclivity for organizations to distribute their work forces, continued outsourcing of functions and business processes, and the progress being made in supporting technology areas, knowledge management and collaboration platforms are becoming even more prolific.”

    Thursday
    Mar092017

    SPONSORED TRANSACTIONS DOMINATING VALUE IN THE HEALTHCARE INFORMATION AND TECHNOLOGY INDUSTRY

    Berkery Noyes’ Healthcare report for full year 2016 revealed that total transaction volume remained constant on a year-to-year basis. Aggregate value gained 75 percent, from $17.47 billion to $30.51 billion. Excluding IMS Health’s merger with Quintiles Transnational Holdings for $8.75 billion, value rose 25 percent. As for strategic acquirers, the number of deals improved three percent, from 351 to 363. Private equity backed volume fell 12 percent, from 101 to 89.

    Regarding private equity, three of the top five and six of the top ten highest value acquisitions in 2016 were completed by financial sponsors. The industry’s largest private equity backed deal during the year was Blackstone Group’s announced acquisition of TeamHealth, a provider of outsourced physician staffing solutions for hospitals in the U.S., for $6.02 billion in the Healthcare Business Services segment.

    Other notable sponsored deals in the Healthcare Business Services segment included EQT’s acquisition of Press Ganey Associates, a healthcare performance improvement company that offers patient experience measurement, performance analytics and strategic advisory solutions, for $2.4 billion; and Bain Capital’s announced acquisition of Epic Health Services, a provider of pediatric skilled nursing, therapy, developmental services, and home adult home healthcare services.

    Deal volume in the Healthcare IT segment decreased five percent on an annual basis. This followed a 20 percent rise in 2015. Strategic acquirers were dominant and comprised 86 percent of Healthcare IT volume over the past year. The segment was also responsible for five of the overall industry’s top ten highest value deals in 2016.

    "One of the most active spaces in healthcare M&A is behavioral health," said Jon Krieger, Managing Director at Berkery Noyes. "It's a high growth, fragmented market driven by very favorable industry tailwinds."

    “We continue to see workflow tools that make practicing medicine, performing a clinical trial or smoothing the operations of healthcare entities as areas with lots of entrepreneurs developing unique solutions,” stated Tom O’Connor, Managing Director at Berkery Noyes. “In addition, there’s a high level of interest in solutions that help move hospitals and other healthcare organizations off client server, on premise solutions to SaaS and cloud opportunities. This entails lower upfront cost, less IT hassles and a better environment for updates.”

    Upon examination of additional markets covered in the report, the combined Pharma IT, Pharma Business Services, and Pharma Information segments saw a 76 percent increase, from 45 to 79 transactions. Deal flow in the Pharma IT nearly doubled, from 25 to 47 transactions. “The pharmaceutical market is experiencing strong demand in the areas of pharma technology, proprietary data, compliance tools, and drug safety information,” added Jeffrey Smith, Managing Director at Berkery Noyes.

    Monday
    Feb272017

    FINANCIAL TECHNOLOGY DEAL VALUE DRIVEN BY THE CAPITAL MARKETS SEGMENT

    Berkery Noyes’ Financial Technology report for full year 2016 showed that transaction volume remained about constant on a year-to-year basis. Aggregate value decreased 26 percent, from $65.29 billion to $48.41 billion. Relative to 2014, volume improved 15 percent and value gained 72 percent.

    M&A volume in the Capital Markets segment, after rising 43 percent in 2015, declined seven percent over the past year. Four of the industry’s top five deals by value during the year involved major exchange operators in the Capital Markets segment.

    Meanwhile, notable Capital Markets deals in 2016 below the $1 billion threshold included E*TRADE Financial Corporation’s acquisition of OptionsHouse, an online stock and option broking company that provides trading platforms for retail and institutional options traders and investors, for $725 million; and Ally’s acquisition of TradeKing, an online brokerage and digital wealth management company, for $275 million.

    The Payments segment experienced an 18 percent rise in volume in 2016. Upon examination of value, three of the industry’s top ten largest acquisitions during the year occurred in the segment. “Worldwide markets are rapidly developing modernized credit and transfer infrastructure, adding further growth to an already sizeable market,” said Peter Ognibene, Managing Director at Berkery Noyes. “Ecosystem players are also pushing hard on experimenting with beta technologies particularly associated with mobile telephony, social media and peer-to-peer, digital and crypto-currency.” Ognibene continued, “Key business problems to be solved include fraud detection and elimination, utilization of multiple payment methods, aggregation of as many customer streams as possible, convergence of industry utilization and global growth of electronic payments.”

    As for other markets covered in the report, acquisition activity in the Banking segment decreased 13 percent on an annual basis, from 90 to 78 deals. This followed a 45 percent increase in 2014.

    “There are several significant drivers impacting the evolution of mortgage technology,” stated John Guzzo, Managing Director at Berkery Noyes. “This includes restoring consumer confidence, decreasing the volume of delinquent loans, stabilizing the debt markets and adhering to new regulatory guidelines.” Guzzo continued, “Mortgage technology vendors and outsourcers offering solutions that provide better quality control, promote process efficiencies, facilitate borrower communication and improve regulatory compliance are in demand by investors and acquirers. Moreover, acquirers are looking for products to round-out their solutions suite and to gain customers and market share.”

    Tuesday
    Jan312017

    E-COMMERCE TRANSACTION VOLUME RISES IN THE ONLINE & MOBILE INDUSTRY

    According to Berkery Noyes’ Online and Mobile report for full year 2016, volume saw a one percent uptick on a year-to-year basis, totaling 2,874 transactions in 2016. Aggregate deal value gained 12 percent, from $157.99 billion to $177.35 billion.

    The number of acquisitions in the consumer mobile application subsector remained about constant from 2015 to 2016. Notable mobile-based transactions in the gaming sector during 2016 included Tencent Holdings’ acquisition of Supercell, the Finnish maker of the “Clash of Clans” game, for $8.6 billion; and a Chinese consortium’s announced acquisition of Playtika, a social and mobile games company headquartered in Israel, for $4.4 billion.

    Additional mobile deals by high profile acquirers in 2016 were Microsoft’s announced acquisition of Swiftkey, which provides predictive keyboard technology for Android and iOS devices, with a reported purchase price of approximately $250 million; Gopro’s announced acquisition of video editing apps Replay and Splice for $105 million; Snap (formerly known as Snapchat) with the acquisition of Vurb, a mobile search and discovery engine, for a reported $110 million; and Bitstrips, which allows users to create personalized emojis and carton avatars, for a reported $100 million; and CNN’s announced acquisition of Beme, a social media app founded by YouTube star Casey Neistat, for a reported $25 million.

    The E-Commerce segment was responsible for the overall industry’s largest yearly rise in volume with an 11 percent increase. One of the most high profile E-Commerce transactions during the past year was Wal-Mart’s acquisition of Jet.com, an online retailer, for $3.3 billion, as the retail giant looks to bolster its online operations to better compete with Amazon and others.

    Other notable segment deals included Salesforce’s acquisition of Demandware, a provider of digital commerce solutions used by retailers, for $2.66 billion; Ctrip’s announced acquisition of Skyscanner, a global travel search site that offers online comparisons for millions of flight, car hire and hotel prices, for $1.74 billion; Thoma Bravo’s acquisition of Trader Corporation, a digital automotive marketplace, for $1.22 billion; and Alibaba Group’s acquisition of a controlling stake in Lazada, an E-Commerce platform that serves consumers in Southeast Asia, for $1 billion.

    As for other sectors covered in the report, volume in the Communications segment stayed nearly the same on a yearly basis. Meanwhile, deal activity in the E-Content segment decreased eleven percent year-over-year. This followed a 21 percent rise in 2015. Transaction activity in the E-Marketing & Search segment increased three percent throughout the last 12 months. 

    “Given the market’s emphasis on data and the increased demand for analytics solutions, companies in this sector should expect to see premium valuations,” said Vineet Asthana, Managing Director at Berkery Noyes. “Before, marketers had few data points and completely relied on humans to source leads. As we moved toward the digital era, the amount of data points that a typical marketer has to interpret every day has skyrocketed.” Asthana continued, “Machine learning has the ability to extract patterns from huge volumes of data which have high velocity and variety. Predictive analytics and machine learning are transforming the way marketers evaluate and respond to consumer activity in milliseconds and cross channel digital marketing is rapidly taking hold.”