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MA Snapshot Q2 2013

Published on May 2016 | Categories: Types, Business/Law | Downloads: 9 | Comments: 0
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Q2 2013 M&A Activity within the Internet | Mobile | Digital Media sectors Architect Partners LLC

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M&A SNAPSHOT
Q2 2013
JULY 1ST, 2013

M&A SNAPSHOT
OVERVIEW COMMENTARY
M&A activity remained slow in Q2 2013, continuing Q1‘s levels. There were 33 M&A transactions within the $25mm - $1b range in Q2, remaining relatively consistent with Q1’s mark of 34. Q2 activity was down a considerable 42% yearover-year from 2012, however the good news is total consideration paid increased by 15%, from $6b in Q1 to $7b in the second quarter of 2013. Marketing automation continues as a prevalent theme in Q2, as industry leaders made large strategic moves to position themselves for the projected growth in digital marketing spend. Salesforce announced the acquisition of publicly traded ExactTarget (NYSE: ET) for $2.5b (paying a 52% premium to ET’s previous day closing price) and Adobe announced the acquisition of Neolane for $600mm, representing a 10.3x LTM revenue multiple. We expect M&A within the digital marketing landscape to remain active as IT spend continues to shift towards revenue generating initiatives. Yahoo made it to the top of our most active M&A leader board for the second consecutive quarter, following Q1’s performance with 8 announced transactions in Q2. The most significant acquisition under Yahoo’s new management is the $1.1b acquisition of micro-blogging social website Tumblr, representing a 84.6x multiple on Tumblr’s 2012 revenue. Architect Partners published M&A Alerts on ten of the most strategic acquisitions of Q2 2013.

FOLLOWING ANALYSIS
M&A DASHBOARD: NOTABLE ACQUIRERS: M&A TRANSACTIONS: OTHER NOTABLE TRANSACTIONS:
SUMMARY OF QUARTERLY ACTIVITY IN NUMBERS AND TONE ACTIVE INFLUENTIAL BUYER ACTIVITY SUMMARY OF TRANSACTIONS BETWEEN $25MM-$1B IN VALUE SUMMARY OF NOTABLE TRANSACTIONS WITHOUT ANNOUNCED VALUE OR ABOVE $1B.

COMING SOON
ANALYSIS OF VC-BACKED M&A EXITS

2

M&A DASHBOARD
COVERAGE
Architect Partners tracks M&A activity within the converging Internet | mobile | digital media sectors. The following assessment is focused on M&A transactions with announced values of between $25mm and $1B as these typically represent successful business-building endeavors.
68

MARKET TONE
Remains at below average levels of activity. Catalysts to improvement not yet clear. 2011 Q3
63

Q2
61

Q4
57

Q1
41

2012 Q2 Q3
57 44

2013 Q4
63
41 46 34 33

Q1

Q2

M&A Exits (#)............................................................................................
$14 $12 $11 $12 $9 $14 $12 $12

$12
$10

$6

$7

Total Consideration Paid ($b)...............................................................

27

23

23

19
12

16

15

12

14

17

13

11

Venture-Backed M&A Exits (#)............................................................
$98 $113 $80 $90

$103

$127

$107

$103 $92

$127

$104

$130

Median Transaction Size ($mm)..........................................................
48% 49% 52% 42%
56% 46% 47% 48% 45%

55% 41% 42%

U.S.-based Target (%).............................................................................

457$

482$

450$

417$

440$ 352$ 364$

466$

440$

352$

387$

327$

All Internet | Mobile | Digital Media M&A Exits(1)............................
Note: 1) Includes all Internet | mobile | digital media transactions regardless of transaction value. Transaction values within a range are presented as a mid-point value Source: Architect Partners, Capital IQ, company filings and public information

3

NOTABLE ACQUIRERS
The following acquirers are generally active or influential buyers within the Internet | mobile | digital media sectors. Below, we highlight announced acquisitions by the most active players in the second quarter of 2013.

ACQUIRER

# 8 4 3 3 2 2 2 2 2 2 1 1

TARGETS

4

NOTABLE ACQUIRERS (continued)
ACQUIRER # 1 1 1 1 1 1 1 1 1 1 1 1 1
5

TARGETS

M&A TRANSACTIONS: $25MM-$1B
M&A transactions that have announced values between $25mm and $1b announced in Q2 2013 within the Internet | mobile | digital media sectors.
# ANNOUNCED DATE BUYER TARGET TRANSACTION VALUE ($MM) TARGET DESCRIPTION AP INSIGHT SM M&A ALERT VCBACKED

NON SERVICE PROVIDER TRANSACTIONS 1 06/27/2013 Adobe Neolane $600 Offers a marketing automation platform for cross-channel campaign management, lead generation and customer data management. Arcueil, Francebased. Delivers platform for military-grade security products, a next generation firewall/VPN product, clustering and multi-link technologies. Helsinki, Finlandbased. Offers a video encyclopedia, video search, games and downloads. Shanghai, China-based. ! !

2

05/06/2013

McAfee

Stonesoft

$377

3

05/06/2013

iQIYI.com

PPStream

$370

4

06/24/2013

Thoma Bravo

Keynote Systems

$399

Develops and sells hardware and software to measure, test and improve the quality of service of Internet and mobile communications. San Mateo, CA-based.

5

04/03/2013

Cisco

Ubiquisys

$310

Provides indoor, small cell wireless networking equipment and software to wireless service providers. Swindon, U.K.-based.

!

6

05/08/2013

Trulia

Market Leader (NASDAQ:LEDR)

$306

Provides real estate agents, agent teams and brokerage companies with subscription software and advertising products. Kirkland, WA-based.

7

04/17/2013

Intel

Mashery

$180

Provides API management tools including platform strategy, measurement of business objectives and infrastructure support. San Francisco, CA-based.

!

8

05/01/2013

DreamWorks Animation

AwesomenessTV

$151

Operates a YouTube channel with programming geared toward teens. Los Angeles, CA-based.

!

9

06/19/2013

Tyco International

Exacq Technologies

$150

Develops open architecture and video management system (VMS) solutions for security and surveillance applications. Indianapolis, Indiana-based.

!

10

04/24/2013

Fusion-io

NextGen Storage

$120

Provides enterprise class storage systems used for server virtualization, virtual desktop, business critical application and analytics solutions. Louisville, CObased.

!

Note: Transaction values within a range are presented as a mid-point value. Source: Architect Partners, Capital IQ, company filings and public information

6

M&A TRANSACTIONS: $25MM-$1B (continued)
# 11 ANNOUNCED DATE 05/21/2013 BUYER SolarWinds TARGET N-able Technologies TRANSACTION VALUE ($MM) $120 TARGET DESCRIPTION Provides network monitoring and remote systems management software. Ottawa, Canada-based. AP INSIGHT SM M&A ALERT VCBACKED

12

04/11/2013

LinkedIn

Pulse

$90

News reading application that aggregates articles from a range of topics and sources selected by users and presents them in a clean and stylish format. San Francisco, CA-based. Mobile backend-as-a-service platform (mBaaS) for iOS and Android applications. San Francisco, CA-based.

!

13

04/25/2013

Facebook

Parse

$85

!

14

05/31/2013

Mediagrif Interactive

Jobboom and Réseau Contact

$63

Jobboom operates a Website for jobs including postings, job search engine, resume-creation tools and professional training. Réseau Contact operates a dating site. Montreal, Canada-based. Operates sgCarMart.com, an online portal for new and used cars. Singaporebased.

15

04/01/2013

Singapore Press Holdings

SGCM

$48

16

05/07/2013

Higher One

SLM Corp, Campus Solutions Division

$47

Provides B2B solutions including e-commerce and billing payment solutions to college and university business offices. Boston, Massachusetts-based.

17

05/06/2013

Xiamen 35.Com Technology

CNFOL.COM

$34

Operates a Chinese online financial information portal. Fuzhou, China-based.

18

04/23/2013

Google

Wavii

$30

Provides an online platform which creates social content in real-time from news available on the Internet. Seattle, WA-based.

!

19

05/16/2013

Aruba

Meridian Apps

$26

Provides mobile phone application that engages users with indoor turn-by-turn directions and enterprise mobile-device software. Portland, Oregon-based.

!

20

05/13/2013

ITV

High Noon Productions

$26

Creative house for television media production. Santa Monica, CA-based.

Note: Transaction values within a range are presented as a mid-point value. Source: Architect Partners, Capital IQ, company filings and public information

7

M&A TRANSACTIONS: $25MM-$1B (continued)
# ANNOUNCED DATE BUYER TARGET TRANSACTION VALUE ($MM) TARGET DESCRIPTION SERVICE PROVIDER TRANSACTIONS 1 04/04/2013 Telenor Cosmo Bulgaria Mobile $934 Offers mobile, mobile broadband and hybrid fixed telephony services. Sofia, Bulgaria-based.

2

04/04/2013

Empresa Nacional de Telecomunicaciones

Nextel del Perú

$400

Operates as a provider of mobile communications in Peru and offers a fully integrated wireless communications tool with Nextel Direct Connect SM service (a digital two-way radio feature). San Isidro, Peru-based. Offers voice, text and data services. Also sells mobile phones online. Toronto, Canada-based.

3

05/16/2013

TELUS

Mobilicity

$374

4

04/16/2013

BT Group

Post and Telecommunications of Kosovo Fisher Communications

$364

Provides fixed telecommunication services to retail and business customers including SIM cards, prepaid scratch cards, post paid services and international roaming services. Prishtina, Republic of Kosovo-based. Owns and operates 20 network-affiliated television stations, 3 Seattle radio stations and 1 managed radio station in the western US. Seattle, WA-based.

5

04/11/2013

Sinclair Broadcast

$360

6

04/23/2013

Marubeni

NEC Mobiling

$335

Operates as a distributor for mobile network operators to provide subscriptions for mobile phone, terminals/peripheral merchandise and offer subscriber-related support services. Tokyo, Japan-based. Provides wireless coverage solutions, including cellular, public safety, broadcast, military communication, air band communication and 3G/4G cellular coverage. Chesham, U.K.-based. Retail telecommunications operations in the U.S. and Canada, including international and domestic long-distance voice, local, broadband, Ethernet, hosted-VoIP and wireless services. McLean, VA-based. Offers platform services for mobile Internet and online videos. China-based.

7

05/10/2013

Cobhalm

Axwell Wireless

$130

8

05/10/2013

York Capital

North American Retail Telecommunications

$126

9

04/26/2013

China Telecommunications

E-surfing Media

$194

10

06/25/2013

CJ Hellovision

Honam Broadcasting

$107

Offers cable broadcasting services. Mokpo, South Korea-based.

Note: Transaction values within a range are presented as a mid-point value. Source: Architect Partners, Capital IQ, company filings and public information

8

M&A TRANSACTIONS: $25MM-$1B (continued)
# 11 ANNOUNCED DATE 05/03/2013 BUYER East Capital Explorer TARGET AS Starman TRANSACTION VALUE ($MM) $38 TARGET DESCRIPTION Operates as a cable television network based telecommunication company. Tollinn, Estonia-based.

12

04/24/2013

EmiTel

INFO-TV-OPERATOR

$36

Provides radio, television and mobile broadcasting services.

13

06/10/2013

Elisa

Kymen Puhelin

$34

Telecommunications services provider. Kotka, Finland-based.

Note: Transaction values within a range are presented as a mid-point value. Source: Architect Partners, Capital IQ, company filings and public information

9

M&A TRANSACTIONS: OTHER NOTABLE
A number of important transactions were announced in the second quarter of 2013 with consideration in excess of $1b or with unannounced transaction values.
# 1 ANNOUNCED DATE 06/24/2013 BUYER Vodafone Vierte TARGET Kabel Deutschland TRANSACTION VALUE ($MM) $14,699 TARGET DESCRIPTION Engages in the provision of basic cable and premium television products and services primarily through individual contracts with customers or collective contracts with landlords and housing associations. Unterfoehring, Germanybased. Provides cross-channel digital marketing software-as-a-service (SaaS) encompassing email, mobile, social media, Websites, marketing automation and data management. Indianapolis, Indiana-based. Owns 20 television stations, including ABC, CBS, NBC, FOX, CW and MyNetwork TV affiliates, as well as their associated Web sites in 15 markets. Dallas, Texasbased. Operates a cloud infrastructure platform for companies including dedicated servers, cloud computing, cloud storage, content delivery network and email delivery service. Dallas, TX-based. Provides a social mobile application that enables drivers to build and use realtime road intelligence on smartphones. Raanana, Israel-based. ! ! AP INSIGHT SM M&A ALERT VCBACKED

2

06/04/2013

Salesforce.com

ExactTarget (NYSE: ET)

$2,500

3

06/13/2013

Gannett Co.

Belo Corporation

$2,146

4

06/04/2013

IBM

SoftLayer Technologies

$2,000

5

06/11/2013

Google

Waze

$1,300

6

06/24/2013

Hutchison 3G Ireland

Telefónica Ireland

$1,113

Provides prepay services, pay monthly services, broadband services, calling and voicemail services, messaging services, mobile Internet, email, ringtones, games and data tariffs. Dublin, Ireland-based. A microblogging platform and social networking website that allows users to post multimedia and other content to a short-form blog. New York, NY-based. !

7

05/20/2013

Yahoo

Tumblr

$1,100

8

06/12/2013

Netsuite

OrderMotion

-

Cloud-based order management and analytics for eCommerce and direct-toconsumer businesses. Burlington, MA-based.

9

04/22/2013

IBM

Urbancode

-

Provides tools that address the continuous release and deployment needs associated with rapid software development, or “DevOps.” Cleveland, Ohiobased.

Note: Transaction values within a range are presented as a mid-point value. Source: Architect Partners, Capital IQ, company filings and public information

10

M&A TRANSACTIONS: OTHER NOTABLE (continued)
# 10 ANNOUNCED DATE 04/03/2013 BUYER TripAdvisor TARGET GateGuru TRANSACTION VALUE ($MM) TARGET DESCRIPTION A mobile app that provides real-time information on airports, weather and flights using crowdsourced data. New York, NY-based. AP INSIGHT SM M&A ALERT VCBACKED

11

05/14/2013

@WalmartLabs

OneOps

-

Automatically scales and repairs applications to ensure availability and optimal utilization of cloud infrastructure. U.S.-based.

12

06/20/2013

Twitter

Spindle Labs

Develops an app to let smartphone users discover social media updates from nearby stores, restaurants, bars, or museums using their phone’s location technology. Boston, MA-based.

!

Note: Transaction values within a range are presented as a mid-point value. Source: Architect Partners, Capital IQ, company filings and public information

11

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