april 11 - quarterly - final - corum group 11 - quarterly... · scm ev/s 5.50 x ev/ebitda 15.81 x...

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Global Tech M&A Monthly

Q1: 2013 Report

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Agenda

Welcome

Field Report: Cisco’s latest acquisition

Quarterly Research Report

Special Report: China

Korea: Global M&A Center

Q&A

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Jon ScottSenior Vice PresidentCorum Group Ltd.

Jon joined Corum in 2010 out of their Seattle headquarters and is now based in Amsterdam. He has close to 30 years experience serving high technology companies with the last 20 mainly in chief operating and chief executive roles. During this time Jon has become known for his ability to successfully integrate strategies and tactics into well executed operating plans, building strong teams and achieving excellent results.

Jon has served as President and CEO of The PowerTech Group, a security and compliance software company sold to Help/Systems in 2008, and Microserv Technology Services, a nationwide tech services company which was acquired by Halifax Corporation in 2003. Earlier he served as President and COO of Traveling Software, a leading developer of communications software in Seattle. Prior to his operating roles Jon held vice president roles in sales, marketing and business development for technology companies.

Jon has taught in the software product management program at the University of Washington and holds a business administration degree from San Francisco State University.

Field Report – SolveDirect

Corum acted as exclusive M&A advisor to SolveDirect

has announced intentions to acquire

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Upcoming World Financial Symposiums

“Growth & Exit Strategies” Live Conference

London, April 18

New York, June 5

Silicon Valley, Fall

Market Spotlight Webcast Series

Social Marketing – April 30

www.worldfinancialsymposiums.com

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Contact:

[email protected]

Corum Research Report

Elon GasperVice President,Director of Research

Contact:

in/elongasper

[email protected]

Amber StonerSenior Analyst

Jason SteblayResearch AnalystContact:

[email protected]

Alina SoltysSenior Analyst

Contact:

in/soltysa

alina.soltys

[email protected]

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Public Markets

-2%

3%

8%

13%

18%

23%Weekly Percentage Change

NASDAQ S&P TECH Dow Jones

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Q1:12 Q1:13

# of Transactions 919 775

# of Mega Deals 8 10

Largest Deal $5.0B $24.4B

Private Equity Deals 29 36

# VC backed Exits 171 172

% Cross Border Transactions 30% 32%

% of Startup Acquisitions* 14% 12%

Average Life of Target 13 14

Corum Index

* 0 to 3 years

Buyer Seller Price

Silver Lake Partners

Dell Inc. $24.4b

Liberty Global Virgin Media Group

$16b

VTB Group Tele2 AB $2.4b

Oracle Acme Packet $2.1b

Charter Communications

Bresnan Communications

$1.6b

Worldwide mergers and acquisitions activity was up 10 percent in the first quarter 2013

- Thomson Reuters quarterly report.

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Q1:12 Q1:13

# of Transactions 919 775

# of Mega Deals 8 10

Largest Deal $5.0B $24.4B

Private Equity Deals 29 36

# VC backed Exits 171 172

% Cross Border Transactions 30% 32%

% of Startup Acquisitions* 14% 12%

Average Life of Target 13 14

Corum Index

* 0 to 3 years

Buyer Seller Price

Silver Lake Partners

Dell Inc. $24.4b

Liberty Global Virgin Media Group

$16b

VTB Group Tele2 AB $2.4b

Oracle Acme Packet $2.1b

Charter Communications

Bresnan Communications

$1.6b

Worldwide mergers and acquisitions activity was up 10 percent in the first quarter 2013

- Thomson Reuters quarterly report.

Divested to

Sector: TelecomTarget: Tele2 AB [RUSSIA]Acquirer: VTB Group [RUSSIA]Transaction Value: $2.4 billion in cash

- Tele2 is one of Europe’s leading telecom operators with 22 million subscribers in Russia

- Acquisition includes the Russian division of Tele2

Deal Spotlight

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FLASHBACK: Corum April 2012 Special Impact Report

The JOBS Act makes it easier to Raise private money

Stay private longer

Go public

Profound impact on Tech M&A

3 main parts

Title I IPO On-Ramp

Title II Solicitation rules relaxed + Safe Harbors

Title III Crowdfunding

UPDATE: SEC blew deadline, postponed implementation (as Corum predicted in April 2012)

Obama: “Because of this bill, start-ups and small business have access to a big, new pool of potential investors.”

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Big Data Visualization

IPO - Seeking to raise about $150m

NYSE symbol “DATA” come May

Financials

Revenue: $128m

Net Income $1.6m

Sales growth rate up 105%

AS SEEN ON

Market Spotlight Series

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Q1:11 Q2:11 Q3:11 Q4:11 Q1:12 Q2:12 Q3:12 Q4:12 Q1:13EV/EBITDA 12.34x 12.29x 9.44x 10.49x 10.95x 9.83x 10.43x 9.91 10.79EV/S 2.38x 2.27x 1.82x 1.77x 2.04x 1.76x 1.80x 1.78 1.92

Corum Index – Aggregate Valuations

6-markets

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Horizontal Application Software MarketPublic Valuation

Mar‐12 Apr‐12 May‐12 Jun‐12 Jul‐12 Aug‐12 Sep‐12 Oct‐12 Nov‐12 Dec‐12 Jan‐13 Feb‐13 Mar‐13

EV/EBITDA 16.55 x 11.77 x 13.58 x 13.13 x 12.72 x 14.03 x 15.08 x 12.75 x 13.25 x 13.42 x 15.00 x 12.44 x 12.97 x

EV/S 3.22 x 2.72 x 2.47 x 2.63 x 2.52 x 2.77 x 2.75 x 2.76 x 2.83 x 2.61 x 2.67 x 2.57 x 2.71 x

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Horizontal Application Software Market

Informatica Corp. MicroStrategy Inc.

Amdocs Ltd. Nuance Communications

Salesforce.com Convergys Corp.

Open Text Corp.

Oracle Corp NetSuite

Callidus Software Inc. Saba Software Inc.

Trimble Navigation Ltd. Concur Technologies Inc.

SPS Commerce Inc. Manhattan Associates Inc.

Business Intelligence

EV/S 2.76 xEV/EBITDA 17.66 x

Communications

EV/S 1.21 x

EV/EBITDA 11.76 x

Content Mgmt.

EV/S 2.88 x

EV/EBITDA 9.87 x

Human Resources

EV/S 2.12 x

EV/EBITDA 67.81 x

ERP

EV/S 2.55 x

EV/EBITDA 10.15 x

SCM

EV/S 5.50 x

EV/EBITDA 15.81 x

CRM

EV/S 4.16 x

EV/EBITDA 19.96 x

Horizontal Other

EV/S 4.14 x

EV/EBITDA 14.21 x

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Open Text Corp.







Communications

EV/S 1.21 x

EV/EBITDA 11.76 x

Content Mgmt.

EV/S 2.88 x

EV/EBITDA 9.87 x

Human Resources

EV/S 2.12 x

EV/EBITDA 67.81 x

ERP

EV/S 2.55 x

EV/EBITDA 10.15 x

SCM

EV/S 5.50 x

EV/EBITDA 15.81 x

CRM

EV/S 4.16 x

EV/EBITDA 19.96 x

Horizontal Other

EV/S 4.14 x

EV/EBITDA 14.21 x

Sold to

Target: G4 AnalyticsAcquirer: The Nielsen CompanyTransaction Value: Undisclosed

- Extends Nielsen’s position as a global leader in trade promotion management, combining Nielsen’s data and trade promotion modeling capabilities for strategic planning with G4's applications for tactical sales planning and execution.

Sold to

Deal Spotlights: BI

Target: Angoss Software Corporation [CAN]Acquirer: Peterson PartnersTransaction Value: $5.35 million

- Provides business intelligence (BI) analytics software and software as a service (SaaS) for the financial, retail, insurance and technology sectors. Software enables businesses to gain insight into sales figures, marketing campaign and credit risks.

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Open Text Corp.







Communications

EV/S 1.21 x

EV/EBITDA 11.76 x

Content Mgmt.

EV/S 2.88 x

EV/EBITDA 9.87 x

Human Resources

EV/S 2.12 x

EV/EBITDA 67.81 x

ERP

EV/S 2.55 x

EV/EBITDA 10.15 x

SCM

EV/S 5.50 x

EV/EBITDA 15.81 x

CRM

EV/S 4.16 x

EV/EBITDA 19.96 x

Horizontal Other

EV/S 4.14 x

EV/EBITDA 14.21 x

Sold to

Sector: Business IntelligenceTarget: Altosoft, Inc.Acquirer: KofaxTransaction Value: $13.5 million in cash

- Altosoft’s software provides rapid, no-coding development of near real time reporting and dashboard applications through the use of a data integration and analytics engine utilizing in-memory techniques.

- Kofax now has all of the core capabilities necessary to provide market leading smart process applications.

Deal Spotlight: BI

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Open Text Corp.







Communications

EV/S 1.21 x

EV/EBITDA 11.76 x

Content Mgmt.

EV/S 2.88 x

EV/EBITDA 9.87 x

Human Resources

EV/S 2.12 x

EV/EBITDA 67.81 x

ERP

EV/S 2.55 x

EV/EBITDA 10.15 x

SCM

EV/S 5.50 x

EV/EBITDA 15.81 x

CRM

EV/S 4.16 x

EV/EBITDA 19.96 x

Horizontal Other

EV/S 4.14 x

EV/EBITDA 14.21 xTarget: conTgo [UK]Acquirer: Concur Technologies

- Adds comprehensive location-based services with advanced mobile communications and messaging capabilities to Concur's offerings, extending the value of the Concur T&E Cloud for partners, suppliers and clients alike.

Sold to

Deal Spotlights: HCM

Sold to

Target: CERTPOINT SystemsAcquirer: Infor Global Solutions

- Enables Infor to offer customers an end-to-end HCM solution, delivered to help maximize access and business insight and achieve breakthrough performance.

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Consumer Application Software MarketPublic Valuation

Digital Content

EV/S 1.10 x

EV/EBITDA 11.64 x

Video Games

EV/S 2.03 x

EV/EBITDA 6.21 x

Adobe Systems, Inc. Netflix

Electronic Arts, Inc. Activision Blizzard, Inc.




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Consumer Application Software MarketDeal Spotlights

Digital Content

EV/S 1.10 x

EV/EBITDA 11.64 x

Video Games

EV/S 2.03 x

EV/EBITDA 6.21 x

Adobe Systems, Inc. Netflix

Electronic Arts, Inc. Activision Blizzard, Inc.




Target Rumored Value Description

$10 millionProvides an online service that enables consumers to save, organize and rate Web content through www.snip.it. Website also provides social networking features.

UndisclosedProvides a smart phone application that enables consumers to search for new restaurants and businesses nearby based on recommendations from places they have previously visited.

UndisclosedProvides a smart phone application that enables iOS device users to receive recommendations on books, movies and restaurants.

$30 millionProvides a smart phone application to enable Apple iOS device users to receive custom news summaries.

Summly

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Internet MarketPublic Valuation

Akami Technologies Inc. Juniper Networks Inc.

Amazon.com Google Inc.

Internet Infrastructure

EV/S 1.73 x

EV/EBITDA 12.20 x

Internet Pure Play

EV/S 1.95 x

EV/EBITDA 12.72 x




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Internet MarketDeal Spotlights




EV/S 1.73 x

EV/EBITDA 12.20 x

Internet Pure Play

EV/S 1.95 x

EV/EBITDA 12.72 x




Target: StorylaneAcquirer: Facebook

- Acquired employees of Storylane, which operates a social networking and blogging website that enables users to author long-form content.

Sold to

Target: Hot StudioAcquirer: Facebook

- Acquired employees of Hot Studio, which provides Web design, enterprise and mobile application development, and online marketing consulting services for businesses in the US

Sold to

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Internet MarketDeal Spotlights




EV/S 1.73 x

EV/EBITDA 12.20 x

Internet Pure Play

EV/S 1.95 x

EV/EBITDA 12.72 x




Sold to

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Internet MarketPublic Valuation




EV/S 1.73 x

EV/EBITDA 12.20 x

Internet Pure Play

EV/S 1.95 x

EV/EBITDA 12.72 x




Sold to

Sector: Internet Pure PlayTarget: GoodreadsAcquirer: AmazonTransaction Value: Estimated $150 million

- Goodreads is a leading site for readers and book recommendations that helps people find and share books they love

- Both Amazon and Goodreads have helped thousands of authors reach a wider audience and make a better living at their craft.

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Vertical Application Software MarketPublic Valuation




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Vertical Application Software Market

Autodesk Inc. Parametric Technology

Itron Inc. Schlumberger Ltd.

Advent Software Inc. Fiserv Inc.

Harris Corp. Lockheed Martin Corp.

Cerner Corp. AllScripts Healthcare Inc.

Rockwell Automation Inc. OpenTable Inc.

A/E/C (Architecture / Engineering /Construction)

EV/S 2.82 x

EV/EBITDA 14.56 x

Government

EV/S 0.78 x

EV/EBITDA 6.05 x

Energy & Environment

EV/S 2.49 x

EV/EBITDA 9.54 x

Financial Services

EV/S 3.65 x

EV/EBITDA 14.24 x

Vertical Other

EV/S 1.91 x

EV/EBITDA 11.11 x

Healthcare

EV/S 3.91 x

EV/EBITDA 21.88 x

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Vertical Application Software MarketDeal Spotlights: Insurance




Target Acquirer Description

Provides policy administration software for commercial property and casualty insurance carriers throughout the US.

Property & Casualty assets, which provide EDI software for the insurance sector in the US.

Provides worker compensation policy and related insurance quote software as a service (SaaS) for insurance markets.

Provides insurance and reinsurance policy quotation and placement software as a service (SaaS) for the insurance sector in Europe and the Middle East.

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Vertical Application Software MarketDeal Spotlight




Sold to

Sector: Financial ServicesTarget: Camilion Solutions, Inc. [CAN]Acquirer: SAP AG [Germany]

- Broadens portfolio in the insurance space, providing insurers with powerful software tools to streamline the management and creation of new products

- Prominently positions SAP in the rapidly emerging market for integrated core insurance platforms, the industry's first "Super Suite.“

- “The first serious move into the insurance vertical solutions space by a global technology firm since Oracle bought AdminServer and Skywire in 2008.”

– Novarica, via InsuranceNetworking.com

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Infrastructure Software MarketPublic Valuation




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Infrastructure Software Market

BroadSoft Inc. Vocus, Inc.

Compuware Corp. Progress Software Corp.

BluePhoenix Solutions Ltd. Tibco Software Inc.

Cisco Systems Inc. NetScout Systems Inc.

Symantec Corp. VeriSign Inc.

BMC Software Inc. CA Inc.

EMC Corp. Qlogic Corp.

Citrix Systems Inc. VMware Inc.

Infrastructure Communications

EV/S 1.85 x

EV/EBITDA 11.84 x

Network Management

EV/S 2.62 x

EV/EBITDA 10.42 x

Storage

EV/S 1.18 x

EV/EBITDA 5.72 x

Virtualization

EV/S 3.38 x

EV/EBITDA 20.56 x

Security

EV/S 4.08 x

EV/EBITDA 11.37 x

Development Tools

EV/S 2.74 x

EV/EBITDA 12.39 x

Legacy/SOA

EV/S 3.52 x

EV/EBITDA 7.38 x

Systems Management

EV/S 2.49 x

EV/EBITDA 9.68 x

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EV/S 1.85 x

EV/EBITDA 11.84 x

Network Management

EV/S 2.62 x

EV/EBITDA 10.42 x

Storage

EV/S 1.18 x

EV/EBITDA 5.72 x

Virtualization

EV/S 3.38 x

EV/EBITDA 20.56 x

Security

EV/S 4.08 x

EV/EBITDA 11.37 x

Development Tools

EV/S 2.74 x

EV/EBITDA 12.39 x

Legacy/SOA

EV/S 3.52 x

EV/EBITDA 7.38 x

Systems Management

EV/S 2.49 x

EV/EBITDA 9.68 xTarget: Dartware, LLCAcquirer: Help/Systems Inc.Transaction Value: Undisclosed

- Help/Systems can now provids a more expansive solution set for its multi-platform customers: network monitoring and analysis with InterMapper and job scheduling with Skybot Scheduler.

Sold to

Target: Vineyard Networks [CAN]Acquirer: Procera NetworksTransaction Value: $28.4 million - $15.62m in stock and $12.78m in cash

- Enables Procera to expand their total addressable market through their OEM business to include enterprise network equipment vendors, adding the entire enterprise space along with additional opportunities in the service provider OEM market.

Sold to

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EV/S 1.85 x

EV/EBITDA 11.84 x

Network Management

EV/S 2.62 x

EV/EBITDA 10.42 x

Storage

EV/S 1.18 x

EV/EBITDA 5.72 x

Virtualization

EV/S 3.38 x

EV/EBITDA 20.56 x

Security

EV/S 4.08 x

EV/EBITDA 11.37 x

Development Tools

EV/S 2.74 x

EV/EBITDA 12.39 x

Legacy/SOA

EV/S 3.52 x

EV/EBITDA 7.38 x

Systems Management

EV/S 2.49 x

EV/EBITDA 9.68 xTarget: Packet Design, Inc.Acquirer: Lone Rock Technology GroupTransaction Value: Undisclosed

- The leading provider of route analytics software for IP networks - its patented technology provides unique visibility into routing and traffic behavior across the entire cloud.

Sold to

Target: LineRate SystemsAcquirer: F5 Networks, Inc.Transaction Value: Undisclosed

- F5 gains access to LineRate’s layer 7+ networking services technology, intellectual property, and engineering talent, further building on F5’s commitment to bring superior service agility, application intelligence, and programmability to software defined data centers.

Sold to

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EV/S 1.85 x

EV/EBITDA 11.84 x

Network Management

EV/S 2.62 x

EV/EBITDA 10.42 x

Storage

EV/S 1.18 x

EV/EBITDA 5.72 x

Virtualization

EV/S 3.38 x

EV/EBITDA 20.56 x

Security

EV/S 4.08 x

EV/EBITDA 11.37 x

Development Tools

EV/S 2.74 x

EV/EBITDA 12.39 x

Legacy/SOA

EV/S 3.52 x

EV/EBITDA 7.38 x

Systems Management

EV/S 2.49 x

EV/EBITDA 9.68 x

Sold to

Sector: Network ManagementTarget: Coyote Point SystemsAcquirer: FortinetTransaction Value: Undisclosed

- Provides Web, email and file-transfer -focused load balancing, application acceleration and traffic management and server performance optimization appliances for businesses globally.

- Should allow Fortinet to focus its efforts on its own hardware by integrating more of its security functionality.

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IT Services MarketPublic Valuation




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IT Services MarketPublic Valuation




Sold to

Target: 2e2 (4 European subsidiaries) [UK]Acquirer: Logicalis Group [UK]Transaction Value: $31 million

- Acquiring four European subsidiaries of 2e2 with operations in Spain, Ireland, the Netherlands and the Channel Islands

- Delivers on their stated intentions to grow their European presence and augment their solutions and services capabilities

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IT Services MarketDeal Spotlights




Divested to

Target: Mitel Networks Corporaton (DataNet CommSource Business)Acquirer: EarthBendTransaction Value: Up to $20m consisting of cash or vendor take-back promissory notes

- The divestiture of DataNet CommSource is part of Mitel's ongoing strategy to simplify and focus the company's core business.

Target: The Hackett Group (Oracle ERP practice)Acquirer: KPMGTransaction Value: Undisclosed

- Broadens KPMG's existing ERP capabilities, while further enhancing the firm's Oracle consulting services

EarthBendDivested to

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Asian IT ServicesPublic Valuation

Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-139.22 x 12.00 x 13.36 x 14.24 x 13.40 x 12.15 x

1.72 x 2.49 x 2.64 x 2.80 x 2.76 x 2.76 x

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Asian IT ServicesDeal Spotlight

Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-139.22 x 12.00 x 13.36 x 14.24 x 13.40 x 12.15 x

1.72 x 2.49 x 2.64 x 2.80 x 2.76 x 2.76 x

Sold to

Target: Transcend United TechnologiesAcquirer: AGC Networks [India]Transaction Value: Undisclosed

- Acquisition is in line with AGC’s 103 growth strategy offering seamless delivery of 10 key solutions, through 10 key alliances across 10 key geographies.

- Transcend’s core competencies in Unified Communications and Data Center Infrastructure, together with the global presence of AGC, positions them as a leader in this rapidly growing space

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Contact:

[email protected]

Corum Research Report

Elon GasperVice President,Director of Research

Contact:

in/elongasper

[email protected]

Amber StonerSenior Analyst

Jason SteblayResearch AnalystContact:

[email protected]

Alina SoltysSenior Analyst

Contact:

in/soltysa

alina.soltys

[email protected]

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A leader in the software industry, Bruce has founded or owned four software companies, including the largest vertical market software company, AMI, an Inc. 500 firm rated by IDC as the fastest growing computer-related company in the world.

He has served on advisory boards for Microsoft, IBM, DEC, Comdex and Apple, and as board member/founding investor in some of the most innovative firms in their field, including Blue Coat, Bright Star and Sabaki. Past advisor to two governors and a senator, a board member of the Washington Technology Center, and founder of the WTIA, the nation’s most active regional technology trade association.

He worked with the Canadian government to found SoftWorld, and he was recently chosen as one of the 200 most influential individuals in the IT community in Europe. He was also the only American juror for the recent Tornado 100 Awards given to Europe’s top technology firms

A graduate with Distinction from Harvard Business School, Bruce has written three books on business models for success, including Power Planning. He is a frequent lecturer and author.

Special Report: China

Bruce MilneCEOCorum Group Ltd.

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China Software/IT M&A Growth Issues

Language

Visas

Insularity

Experience

Leverage

Education

Connections

Trust

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Q&A

We welcome your questions! Use Q&A window on right side

Submit to queue at any time

Ask “all panelists” – see “ask” option above text-entry box

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Upcoming Conference ScheduleSelling Up Selling Out (SUSO) - Ready to go to market? During this half-day workshop, learn to prepare, position, research, value, negotiate, and execute due diligence for maximum price and structure. This is the most attended Tech M&A event ever – participants have done over $1 trillion in transaction value.

Merge Briefing (MB) - The Merge Briefing is a 90-minute executive briefing providing a current M&A market update (trends, valuations, etc.), as well as a brief overview of the Tech M&A process: “8 Steps To An Optimal Outcome.”

www.CorumGroup.com/Events.aspx

Apr. 17: Salt Lake City – MB

Apr. 30: Reston – MB

May 2: Kansas City – MB

May 7: Omaha – MB

May 7: Ottawa – SUSO

May 8: Des Moines – MB

May 9: Boston – MB

May 16: Atlanta – MB

May 21: Chicago (O’Hare) – MB

May 21: Chicago (Downtown) – MB

May 28: Amsterdam – MB

May 28: Toronto – SUSO

May 30: Paris – MB

May 30: Vancouver, BC – MB

June 4: Rochester – SUSO

June 6: Silicon Valley – MB

June 13: Denver – MB

June 18: Kitchener – MB

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After the Deal – Celebration

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www.corumgroup.com

april 11 - quarterly - final - corum group 11 - quarterly... · scm ev/s 5.50 x ev/ebitda 15.81 x...

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