Presented by Berkery Noyes 1
October 2010Third Quarter Mergers and Acquisitions Update
SOFTWARE INDUSTRYQ3 Key Highlights
• ThemostactiveacquirerwithintheSoftwareIndustrythroughQ32010wasGoogleInc.with17acquisitions,10ofwhichoccurredwithinQ32010.GoogleInc.hasmadeadditionalpurchasesin2010,butwedidnotclassifythoseaswithinthesoftwareindustry.
• ThelargesttransactioninQ32010wasthepurchaseofMcAfeebyIntelCorporationfor$7.5billion.Q3 Trends
• TotaltransactionvolumeinQ32010increasedby6percentoverQ22010,from247to263transactions.
• TotaltransactionvalueinQ32010increasedby2percentoverQ22010,from$28.5billionto$29.1billion.
Multiples & Value Trends
•Medianmultipleshaveshownmarkedgrowthfrom2009tothefirstnine monthsof2010.MedianEBITDAmultiplesrosefrom10.0to15.9,a59 percentincrease,whilemedianrevenuemultiplesrosefrom1.5to2.3,a 53percentincrease.
•Medianvaluehasmadesimilargains,dueinlargeparttothestrong valueoftransactionsinQ2andQ32010.
Top Ten Deals through Q3 2010
• Thetoptendealsbyvaluehaveshiftedconsiderablysinceourhalfyearreport,with6acquisitionsenteringthelistfromQ32010:IntelCorporation’sacquisitionofMcAfee,Inc.,HexagonAB’sacquisitionofIntergraphCorporation,HP’sacquisitionsofboth3PARInc.andArcSight,Inc.,KKR’sacquisitionofVismaASA,andIBM’spurchaseofNetezzaCorporation.
• Theseacquisitions,totalling$16.9billioninvalue,represent27percentoftotaltransactionvalueinthe1stninemonthsof2010,and58percentofQ32010transactionvalue.
Figure 2. 2009 - 2010 value and volume comparison.
Figure 1. 2007 - 2010 median: Value, Revenue, EBITDA comparison.
Deal Date Target Name Buyer Value MM US$
08/19/10 McAfee, Inc. Intel Corporation $7,54805/12/10 Sybase, Inc. SAP AG $5,64907/07/10 Intergraph Corporation Hexagon AB $2,12509/02/10 3PAR Inc. HP $2,07309/26/10 Visma ASA Kohlberg Kravis Roberts & Co. $1,90204/21/10 CyberSource Corporation Visa, Inc. $1,84209/20/10 Netezza Corporation IBM $1,73009/13/10 ArcSight, Inc. HP $1,50804/28/10 Palm, Inc. HP $1,40105/24/10 Sterling Commerce, Inc. IBM $1,400
2010 Aggregate Transaction Value $62,790
Top 10 Aggregate Transaction Value $27,179
Top 10 Aggregate Value as a Percentage of All Transactions 43 %
Figure 3. Lists the top ten transactions for the 1st nine months of 2010 and calculates their aggregate transaction value as a percentage of the 2010 total aggregate transaction value.
note: Transaction data based on announced date.
Top Ten Notable Transactions - 1st 3 Quarters 2010
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Some of our deals include:
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JOHN GUZZO | Managing Director, Finance GroupDICK O’DONNELL | Managing Director, Finance GroupPETER OGNIBENE | Managing Director, Finance GroupCHRISTOPHER W. YOUNG | Managing Director, Finance GroupVIVEK KAMATH | Managing Director, Education GroupCHRIS CURRAN | Senior Advisor - Education Group THOMAS O’CONNOR | Managing Director, Healthcare/Life Sciences GroupJEFFREY SMITH | Managing Director, Healthcare/Life Sciences GroupKATHLEEN THOMAS | Managing Director, Media & Marketing Services GroupMARY JO ZANDY | Managing Director, Media, Software & Online
JOSEPH BERKERY | Chief Executive OfficerJOHN SHEA | Chief Operating Officer
About Berkery Noyes
Founded in 1980, Berkery Noyes is the leading independent investment bank specializing in the information content and technology industries. The firm has initiated, managed and closed more than 475 merger and acquisition transactions for privately held and publicly traded companies in the business, technol-ogy, education, health, financial and legal information segments. Berkery Noyes is unique among investment banking firms in that we combine truly independent strategic research and industry intelligence with senior information technology banking expertise. With no equity fund or brokerage business to manage, our partners and investment bank-ing professionals are one hundred percent focused on M&A advisory services. Berkery Noyes employs over 40 individuals with deep industry knowledge and experience who strive to exceed our clients’ expecta-tions by maximizing the full value of their information technology and content assets.
All charts in this report are based on data gathered by Berkery Noyes
research department. All time period statistics are based on the transaction announcement date.
For current intelligence on Merger and Acquisition activity in the
Information Industry please visit our online service at www.mandasoft.com
The DNA of M&A
