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      MERGERS AND ACQUISITIONS UPDATES FROM BERKERY NOYES

    Entries in Mobile (25)

    Monday
    Jul132015

    ONLINE AND MOBILE DEAL ACTIVITY REMAINS ROBUST, REACHES NEW HEIGHTS IN FIRST HALF 2015

    According to Berkery Noyes’ Online and Mobile report for first half 2015, transaction volume increased 12 percent over the past six months. Aggregate value rose nine percent, from $64.55 billion to $70.27 billion. The median revenue multiple decreased from 2.6x to 2.3x, while the median EBITDA multiple declined from 13.7x to 10.3x. The peak for both volume and value over the last 30 months occurred in first half 2015.

    The most active segment year-to-date was SaaS & Cloud with 406 transactions, which represented a 16 percent increase compared to second half 2014. This was the segment’s highest level of activity on a half year basis during the past two-and-a-half years. Regarding valuations, SaaS & Cloud deals in first half 2015 received a median revenue multiple of 3.5x.

    M&A volume in the E-Commerce segment improved ten percent in first half 2015. Five of the industry’s top ten largest acquisitions year-to-date were also E-Commerce related. As for specific E-Commerce 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.

    The number of deals in the consumer application subsector increased 12 percent, from 119 to 133. Meanwhile, one of the largest mobile-based payments transactions in first half 2015 was PayPal’s acquisition of mobile wallet platform Paydiant for $280 million in the B2B subsector. Samsung also completed a mobile payments deal with the acquisition of LoopPay, a digital wallet solution.

    “Currently there is no dominant player in the mobile payments space, but giants like Apple, Google and PayPal are vying for control,” said Peter Ognibene, Managing Director at Berkery Noyes. “It is also important to note that mobile payments alone may not provide a value-added service for consumers. However, companies that can integrate a full range of products with their mobile payments platform provide a compelling reason for both consumers and merchants to adopt the technology.” Ognibene continued, “Another complimentary development in mobile payments landscape, the acceptance of host card emulation (HCE) by MasterCard and Visa, will further facilitate the expansion of mobile payments.” 

    Monday
    Apr132015

    ONLINE & MOBILE VOLUME LED BY DEALS IN THE SAAS & CLOUD SEGMENT

    Berkery Noyes’ Online and Mobile report for Q1 2015 showed that deal volume saw a four percent uptick. This was its third straight quarterly increase. Total transaction value gained 15 percent over the past three months, from $22.6 billion to $26.1 billion.

    SaaS & Cloud volume increased for the fifth consecutive quarter with a 17 percent rise in Q1 2015. This was the segment’s largest quarter-to-quarter increase during the last five quarters. It also remained the most active Online and Mobile market, representing 30 percent of the industry’s aggregate volume year-to-date. E-Marketing & Search volume fell nine percent in Q1 2015, which marked a return to its Q4 2014 level.

    E-Commerce deal activity remained about constant in Q1 2015. This followed a 33 percent gain in Q4 2014. Moreover, the E-Commerce segment represented four of the overall industry’s top ten largest deals in thus far in 2015. Online travel giant Expedia was responsible for two notable segment transactions, acquiring rival Orbitz Worldwide for $1.7 billion and Travelocity.com for $280 million.

    This continues a trend of major search sites being acquired in the sector over the past several years, such as Priceline’s acquisition of Kayak.com for $1.5 billion and Expedia’s acquisition of Trivago for $506 million, both of which occurred in Q4 2012.

    Meanwhile, the number of transactions 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. Ola is the largest mobile taxi application in India and one of Uber’s main rivals in the region.

    Regarding the Communications segment, transaction volume rose 16 percent. This also marked a 40 percent improvement compared to its Q1 2014 level. In addition, there were several recent transactions in the segment pertaining to governance, risk, and compliance (GRC), such as Smarsh’s acquisition of Presensoft, a provider of archiving and compliance solutions.

    “Relative to compliance, the instant messages, e-mails and other electronic communications and documents brought inside the four walls must adhere to appropriate records management,” said Peter Ognibene, Managing Director at Berkery Noyes. “This includes policies to meet with regulatory and/or discovery requirements.” Ognibene continued, “Many organizations are still creating comprehensive policies for this information and have not yet implemented solutions to address them. As a result, the environment for M&A activity in the GRC sector remains strong.”

    Wednesday
    Jan282015

    ONLINE AND MOBILE TRANSACTION ACTIVITY MOVES UPWARD FOR THE THIRD CONSECUTIVE YEAR

    According to Berkery Noyes’ Online and Mobile report for full year 2014, transaction volume increased 12 percent on a year-to-year basis. Aggregate deal value nearly doubled, from $66.58 billion to $126.74 billion. The median revenue multiple saw an uptick from 2.2x to 2.4x, while the median EBITDA multiple moved slightly from 12.6x to 12.0x.

    The SaaS & Cloud segment experienced an 11 percent increase in volume between 2013 and 2014. It also had the highest median enterprise value multiples for the three years covered in the report at 2.9x revenue and 14.9x EBITDA, respectively.

    The number of transactions in the industry’s consumer mobile application subsector improved eight percent, from 217 to 234 transactions. This also represented a 40 percent gain in the subsector compared to 2012. Deals in the business-to-business mobile application subsector improved 18 percent over the previous year, from 193 to 228.

    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. Rounding out this list was Microsoft’s acquisition of email application Acompli for $200 million.

    The E-Marketing & Search segment saw volume improve 18 percent throughout the last 12 months. Notable deals in the E-Marketing & Search segment during the year included Alliance Data Systems’ acquisition of digital marketing business Conversant for $2.34 billion; Yahoo!’s acquisition of BrightRoll, a programmatic video advertising platform, for $640 million; and Comcast’s acquisition of Freewheel, a video ad serving company utilized by TV networks and media companies, for $360 million.

    “Along with strong market growth, there are movements afoot related to converging communications technologies, content distribution, advertising, search and media. This all suggests significant developments and investments ahead,” said Evan Klein, Managing Director at Berkery Noyes. “The participation of advertising agencies, global brands, and carriers in marketing programs to mobile users ranges from advertisers seeking measurable results within targeted demographics to traditional television and media companies attempting to capture new sources of revenue.” Klein continued, “The growing interest in providing a robust customer experience regardless of the platform used also has numerous software companies considering mobile plays to ensure that their capabilities extend well to that environment.”

    Monday
    Oct272014

    ONLINE AND MOBILE DEAL VALUE REBOUNDS STRONGLY IN THIRD QUARTER 2014

    Berkery Noyes has released its third quarter 2014 Online and Mobile report. Total volume declined 12 percent, from 621 transactions in second quarter 2014 to 546 transactions in third quarter 2014. At the same time, aggregate value increased 74 percent, from $21.3 billion to $37.0 billion. When compared to the first three quarters of 2013, the number of deals year-to-date rose nine percent. SaaS & Cloud, which saw volume remain about the same on a quarter-to-quarter basis, was the most active market segment in third quarter 2014 with 158 transactions.

    Acquirers are also continuing to show strong interest in mobile analytics. One example in third quarter 2014 was Yahoo!’s acquisition of Flurry, with a reported purchase price between $200 and $300 million. In terms of high profile private equity backed companies in the online analytics space, Vocus and Cision acquired Visible Technologies, a social media monitoring and analytics firm. This was the first acquisition by Vocus and Cision after being combined by private equity firm GTCR in second quarter 2014.

    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. Viator provides travelers with online and mobile access to thousands of tours and activities, as well as traveler submitted reviews, photos, and videos.

    Transaction volume in the Communications segment, after rising 33 percent from first to second quarter 2014, declined 30 percent in the third quarter. Blackberry, as it looks to build its portfolio of value added services, completed several mobile-based transactions in the quarter with the acquisition of Movirtu, a provider of virtual identity solutions; and Secusmart, a security voice and data encryption company. These were Blackberry’s first acquisitions since 2011.

    “Strategic buyers and investors are looking at acquisitions and investments to either fill/enhance a product or service void in their offerings or as a platform acquisition,” said Evan Klein, Managing Director at Berkery Noyes. “This robust level of activity is a result of the significant amounts of cash held by operating companies and financial investors. Strategic acquirers are looking to enhance revenue growth and facilitate the transition of any legacy businesses through acquisition.”

    Monday
    Jul212014

    ONLINE AND MOBILE M&A VOLUME CONTINUES TO TREND UPWARD

    Transaction volume in the Online and Mobile industry increased seven percent in first half 2014, as indicated in Berkery Noyes' half year report. Aggregate value rose 57 percent, from $40.82 billion to $63.97 billion. The median revenue multiple remained constant at 2.3x, while the median EBITDA multiple increased from 9.5x to 12.5x.

    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. This was the first time that E-Marketing & Search volume surpassed the SaaS & Cloud segment on a half year basis during the past two and a half years covered in the report. However, SaaS & Cloud deals during this timeframe received a median revenue multiple of 2.9x and a median EBITDA multiple of 15.6x, compared to 1.2x and 11.8x for E-Marketing & Search deals, respectively.

    The number of deals in the E-Commerce segment improved nine percent in first half 2014. There were two notable instances of travel companies making acquisitions focused on the restaurant marketplace. Along these lines, the largest transaction in the E-Commerce segment was Priceline’s acquisition of online restaurant management system OpenTable for $2.4 billion. A similar deal in the half year period was TripAdvisor’s acquisition LaFourchette, a European-based online restaurant booking platform, for a reported $140 million.

    As for notable trends relevant to E-Commerce, acquirers have also been showing an interest in omni-channel retail solutions. This is becoming more crucial as analytics, social media, and other tools to better understand the purchasing habits of consumers gain in popularity. Recent deals in the space included ShopperTrak’s acquisition of RapidBlue Solutions and SAP’s acquisition of SeeWhy.

    “E-commerce can be altered by tailoring products to specific audiences and marketers can use social graphing to optimize online advertising,” said Evan Klein, Managing Director at Berkery Noyes. “Given the emphasis being placed on big data and leveraging large datasets, interpreting habits and preferences based on social connections is another important tool that can be used to help predict consumer behavior.”