CUSTOMER RELATIONS SOFTWARE AND TECH M&A

Transaction volume relating to customer relations software increased 33 percent between 2010 and 2011, from 67 to 89 transactions. There have been several notable transactions thus far in 2012 as well. 

Most recently, IBM announced its acquisition of Tealeaf Technology. Tealeaf, with its array of analytics software, allows marketers to gain additional insight as to how customers interact with business websites. With this knowledge, companies are better positioned to improve their digital marketplace and therefore the online consumer experience. One key goal behind acquiring Tealeaf is for IBM to build momentum behind its “Smarter Commerce” initiative.

A few days before the announced acquisition of Tealeaf, Intuit announced its acquisition of Demandforce for $423 million. Demandforce enables small and medium sized businesses to automate their marketing and customer communications. Intuit believes Demandforce’s SaaS model will help them grow their customer base and revenue per customer. 

Also of note, Facebook acquired another mobile company in April besides Instagram. Tagtile, a startup, is a more traditional type of acquisition for Facebook. Tagtile is used by businesses to increase their number of repeat purchasers. Consumers can download an iOS or Andoid app to pay for purchases, which allows them to earn loyalty points. Business owners benefit by collecting data that allows them to engage in specialized direct marketing campaigns.

SOFTWARE INDUSTRY FIRST QUARTER 2012 TRENDS REPORT

Berkery Noyes has released its Software Industry M&A trends report for the first quarter. Within the niche software classification, which is software designed to be used by specific vertical industries, software targeted to financial firms was one of the most active segments. The largest related deal for the quarter was Vista Equity Partners’ announced acquisition of Misys, a provider of banking and financial services software solutions, for $2 billion. 

Upon deeper inspection, 52 percent of financial software deals in Q1 2012 were related to capital markets. According to Berkery Noyes managing director Peter Ognibene, “Big data is increasing the demands on trading, modeling, executing, and portfolio management.” 

SECURITY SOFTWARE M&A

There continues to be M&A interest pertaining to Internet-based (i.e. cloud security) software. In this post, we’re highlighting three recent transactions. The companies that were acquired offer either cloud based and/or Software-as-a Service (SaaS) cyber security solutions in the space.

This week, TrustWave Corp. announced its acquisition of M86 Security. According to TrustWave, one of the key objectives of the acquisition is to incorporate Web security into its product portfolio.

Two weeks ago, Juniper Networks announced its acquisition of Mykonos Software, and Alert Logic acquired Armorlogic. Mykonos Software uses deception technology to prevent hackers in real-time while Amorlogic develops web applications to proactively deter cyber attacks.

In addition, social networking sites are beginning to take necessary steps and investments to secure their users data, which is an ongoing concern. Twitter’s January acquisition of Dasient, a cloud based technology company that helps avert malware attacks, is just one example.

BANK TECHNOLOGY AND SOFTWARE M&A

There have been several recent software mergers and acquisitions in the bank technology segment. 

The largest by far was Misys’ announced merger with Temenos Group, a provider of banking software systems to a diverse array of financial institutions, for approximately $2 billion. However, just today, Temenos was granted an additional four weeks by a UK takeover panel to prepare its offer. If the merger talks are cancelled, Misys has stated that it plans to evaluate other approaches.

A related bank technology transaction was Sopra Group’s announcement that it will buy a majority stake in Callatay & Wouters. Sopra will then merge Callatay & Wouters’ banking software package with its own products to create a new banking software outlet.

Another February deal in this space was Integrated Bank Technology’s acquisition of Beacon Software. Beacon supplies software and hosted solutions, including in-house internet and mobile banking services, to community financial institutions.

SOFTWARE M&A IN THE MOBILE APP SEGMENT

It has been almost a month since Twitter acquired Summify, the creator of a social news app. Summify’s mobile app scans people’s news feeds, aggregating the content most relevant to individual users as real-time news spreads through social networking sites. 

The unique summaries are based on several factors, including how often someone’s followers on Twitter shared the story and/or the number of their friends who “liked” it on Facebook. These news summaries can be sent by email or straight to a mobile device.

In our Full Year Software Industry M&A press release, we said that deal volume in the mobile app segment has grown more than 60% since 2010. Google, Facebook, and RIM continue to be activity leaders in the mobile app space. Each company, looking to expand their smartphone offerings, had four such transactions in 2011.