ma flash report december 2009 final - corum group...corum group presentation 2 >> for...
Post on 13-Jul-2020
1 Views
Preview:
TRANSCRIPT
USA Switzerland Germany France United Kingdom Canada Norway Brazil
www.corumgroup.com
M&A Flash Report M&A Flash Report –– Dec. 2009Dec. 2009Software and IT Industry Market Update
Thursday, December 3, 200910:00 am PT
Monthly M&A Flash Report
Bruce MilneCEOCorum Group Ltd.
Bruce Milne, CEO and founder of Corum, has overseen more M&A transactions than anyone in the world
Mark ReedExecutive Vice PresidentCorum Group Ltd.
Corum Group Presentation ■ 2
>> For today’s presentation or more information, contact Pat Sultan(pats@corumgroup.com, +1 425-455-8281 ext. 248)
Bruce Milne, CEO and founder of Corum, has overseen more M&A transactions than anyone in the world over the past 25 years, generating over $6 Billion in wealth for clients in 24 countries.
He has founded or owned four software companies, including AMI, the world’s largest vertical market software firm, and was a founding investor in some of the most innovative firms in their field, including Blue Coat, Bright Star and Sabaki.
A recognized industry expert, he has served as a personal advisor to Bill Gates on operating systems, Apple on the development of the Mac, and as one of top 10 industry advisors to IBM. He has served on the board of Washington Technology Center at the University of Washington, and is the founder of the WTIA, the nation’s leading regional technology trade association.
Outside the U.S. 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 is also the only juror from North America for the Tornado 100 Awards in Europe’s.
A Deans List graduate in International Business from the UW, and a graduate “With Distinction” from Harvard Business School, Mr. Milne has written three book, including “Power Planning, How To Structure Your Software Company For Success”.
Dougan MilneDirector of ResearchCorum Group Ltd.
Tomoki YasudaAnalystCorum Group Ltd.
Valuations Up – “Time to Sell?”
AGENDA� Overview of Current Market� Market and Valuation Analysis� Closing Comments - Q&A
Corum Group Presentation ■ 3
� Closing Comments - Q&A
Asia - East
� “Dubai World restructuring $26 Billion in debt...none backed by Government”
� “India Growth Shatters Forecasts – Up 7.9%”� “Tokyo Moves To Break Deflationary Spiral”
Corum Group Presentation ■ 4
� “Wen Labels Renmindi Pressure ‘Unfair’”� “China Grows At A Faster Pace”� “Emergency Meeting As Yen Drops Most in 7 Months”
Europe Zone
� “EU Consumer Prices Up - First Time In 7 Months”� “British House Prices Climb For 4th Month”� “2010 U.K Recovery Prediction ‘Too Optimistic’”� “Eurozone Inflation Turns Positive”
Corum Group Presentation ■ 5
� “Eurozone Inflation Turns Positive”� “U.K. Business Numbers Up As Jobs Are Lost –
‘Necessity Entrepreneurs!’”� “U.K. Write-Offs Hit Record”� “Eurozone Unemployment At 11 Yr. High”
Currencies
� “Swiss Franc Chosen Currency”� “Australia Raises Key Rates to 3.7%”� “Brazilian Real Best Performing Currency”� “Canada’s Currency Hits 18 Mo. High”
Corum Group Presentation ■ 6
� “Canada’s Currency Hits 18 Mo. High”� “Dollar Resumes Slide”� “Gold Soars Past $1200”
North America
� “U.S. Business Activity Accelerates in November”� “Canada’s Recovers, but less than expected� 0.4%”“Chip Sales Rise 5.1% in October”� “Job Cuts Loom As Construction Stimulus Fades”
Corum Group Presentation ■ 7
� “Job Cuts Loom As Construction Stimulus Fades”� “Steelmakers Downsizing Once Again”� “U.S. Manufacturing Expands 4th Month”� “ADP – Job Losses Exceed Expectations”� “Fed Sees Subdued Economic Rebound”
Housing
� “Lenders Face Sanctions For Failed Loan Modifications – 650,000 Trial Revisions Not Converted”
� “Wealthy Investors Raise Real Estate
Corum Group Presentation ■ 8
� “Wealthy Investors Raise Real Estate Holdings”
� “Home Sales Unexpectedly Climb 3.7%”� “U.S. Commercial Mortgage Default 3.4% -
16 Yr. High”
Retail
� “Cyber Monday Online Retail Sales Increase 16%”
� “More Shoppers Hit Stores, Spend Less Each...Favor Low Price Items”
Corum Group Presentation ■ 9
Each...Favor Low Price Items”� “Holiday Shopping Losing Meaning as U.S.
Economic Barometer”
Valuations Are UP – Why?
� Buoyant Financial Markets� Pent up buyer demand� Currency fluctuations – Dollar on sale!� PE buyers are back
Corum Group Presentation ■ 10
� PE buyers are back� Cash available
Rise in Valuations Fuel Sales
� Divestitures are up� Venture Capitalists are moving portfolio� Sellers are responding to buyer overtures� Mega Deals are being done
Corum Group Presentation ■ 11
� Mega Deals are being done� Even smaller transactions are happening
Recent Transactions Closed
Corum Group Presentation ■ 12
Recent Transactions Closed
Corum Group Presentation ■ 13
Firms in Letter Of Intent (LOI)
� Vertical market – Financial Services� Mobile search applications� Vertical market – Healthcare (SaaS)� Network security solutions
Corum Group Presentation ■ 14
� Network security solutions� IT Services� Mobile messaging solutions
Current Offers
� Network management solutions� Vertical market - Wholesale Distribution� Application development tools� Enterprise Content Management
Corum Group Presentation ■ 15
� Enterprise Content Management� CRM � Vertical market – Insurance� Enterprise Application Integration
Tomoki YasudaAnalystCorum Group Ltd.
Market Valuation Analysis
Corum Group Presentation ■ 16
Tomoki is currently an analyst working at Corum’s headquarters in Bellevue, WA. At Corum, Tomoki is responsible for conducting research and market analysis on companies, economy, and valuations. He is a contributor to the Merger and Acquisitions Quarterly and has been responsible for updating the internal processes for Corum.
Public Markets
90.00
100.00
110.00
120.00
Nasdaq S&P Tech Dow
Corum Group Presentation ■ 17
40.00
50.00
60.00
70.00
80.00
90.00
Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
M&A Activity – November
Number of Software and IT M&A Transactions
233
267
Corum Group Presentation ■ 18
2004
2005
319
247
0 50 100 150 200 250 300 350
November
2009 2008 2007 2006 2005 2004
Corum Index – M&A Statistics
# of Transactions# of Mega DealsLargest DealAverage Deal SizeMedian Seller Size
Nov-082333
$5,352$209$13
Nov-092679
$5,200$356$23
Corum Group Presentation ■ 19
$ values in millions
Median Seller Size# VC backed Exits% Terms UndisclosedAll Cash (announced)% Targets were Public% Public Buyers
$1322
68%43%15%51%
$2334
66%44%16%49%
Horizontal Application Software Market
Public Valuations Deal Spotlight:
Sector: SCMTarget: i2 Technologies, Inc.Buyer: JDA Software Group, Inc.Date: November 2009Transaction Value: $556.1 millionTransaction Multiple: 1.7x
Horizontal
Corum Group Presentation ■ 20
Transaction Multiple: 1.7xStructure: Cash & Stock
Comments:� Formerly stalled deal� Strengthening key verticals� Expanded product portfolio
Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
EV/EBITDA 6.82 x 9.23 x 9.39 x 9.99 x 11.06 x 11.06 x 12.67 x 12.26 x 11.66 x
EV/S 1.12 x 1.16 x 1.35 x 1.50 x 1.58 x 1.93 x 2.41 x 2.21 x 2.29 x
Horizontal
Application
Software
Public Valuations
Vertical Application Software Market
Deal Spotlight:
Sector: HealthcareTarget: IMS Health, Inc.Buyer: TPG Capital/CPP Investment BoardDate: November 2009Transaction Value: $5.2 billionVertical
Corum Group Presentation ■ 21
Transaction Multiple: 2.4x Structure: Cash
Comments:� Healthcare vertical� Positioned for long-term growth� Private equity megadealMar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
EV/EBITDA 6.53 x 7.26 x 7.99 x 8.17 x 8.91 x 9.01 x 9.32 x 8.42 x 8.96 x
EV/S 1.14 x 1.31 x 1.40 x 1.51 x 1.51 x 1.66 x 1.80 x 1.57 x 1.82 x
Vertical
Application
Software
Public Valuations
Consumer Application Software Market
Deal Spotlight:
Sector: GamingTarget: Playfish, Ltd.Buyer: Electronic Arts, Inc.Date: November 2009Transaction Value: $275 millionTransaction Multiple: 5.5x
Corum Group Presentation ■ 22
Structure: Cash w/additional earn-out of up to $100m through 2011.
Comments:� Change in gaming dynamic� Social gaming going mainstream� Client baseMar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
EV/EBITDA 2.74 x 3.81 x 2.83 x 4.47 x 4.57 x 4.27 x 5.88 x 5.23 x 5.71 x
EV/S 0.64 x 0.69 x 0.50 x 0.53 x 0.53 x 0.59 x 0.83 x 0.60 x 0.61 x
Consumer
Application
Software
Infrastructure Market
Public Valuations Deal Spotlight:
Sector: SecurityTarget: Guardium, Inc.Buyer: IBM CorporationDate: November 2009Transaction Value: $232 millionTransaction Multiple: 6.1x
Corum Group Presentation ■ 23
Transaction Multiple: 6.1xStructure: Cash
Comments:� Latest in a string of acquisitions by IBM� Focus on application infrastructure security� Streamline compliance
Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
EV/EBITDA 6.98 x 8.46 x 8.29 x 8.74 x 9.59 x 10.92 x 10.46 x 10.81 x 9.76 x
EV/S 1.43 x 1.55 x 1.52 x 1.72 x 1.95 x 2.02 x 2.14 x 2.20 x 2.27 x
Infrastructure
Software
Internet Market
Public Valuations Deal Spotlight:
Sector: Mobile AdvertisingTarget: AdMob, Inc.Buyer: Google, Inc.Date: November 2009Transaction Value: $750 millionTransaction Multiple: 37.5x
Internet
Corum Group Presentation ■ 24
Transaction Multiple: 37.5xStructure: Stock
Comments:� Strengthening Google’s presence in the mobile� Interactive marketing abilities� Technology and TalentMar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
EV/EBITDA 7.54 x 9.80 x 11.78 x 11.81 x 13.32 x 13.02 x 15.80 x 11.81 x 13.03 x
EV/S 1.60 x 2.11 x 2.26 x 2.30 x 2.48 x 2.60 x 2.70 x 2.19 x 2.45 x
Internet
IT Services Market
Public Valuations Deal Spotlight:
Sector: IT ServicesTarget: CFC Information SystemesBuyer: Adesso AGDate: November 2009Transaction Value: N/A
Corum Group Presentation ■ 25
Comments:� Geographic expansion� Domain expertise
Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
EV/EBITDA 5.32 x 5.76 x 5.51 x 5.24 x 5.56 x 5.67 x 6.66 x 6.10 x 6.16 x
EV/S 0.56 x 0.60 x 0.61 x 0.63 x 0.68 x 0.68 x 0.73 x 0.73 x 0.63 x
IT Services
Dougan MilneDirector of ResearchCorum Group Ltd.
Market Valuation Analysis
Corum Group Presentation ■ 26
Dougan is the head of Corum’s research team serving as the Director of Research. During his time with Corum, Dougan spent three years working with Corum's international group headquartered in Zürich, Switzerland. Prior to joining Corum's team in 2005, Dougan spent three years working in the banking industry with Bank of America, and Citigroup's Private Wealth business unit. Before entering finance and investment banking, Dougan founded the successful garment distribution business, Billions Apparel and the advertising firm, ModoMarketing. Dougan has a Bachelors degree in Business Economics from the University of San Diego.
Unique Opportunity
� Mega Deals
� Divestitures
Corum Group Presentation ■ 27
� Private Equity Buyers
� Venture Portfolio Exits
� Re-Valuations
Nat BurgessExecutive Vice PresidentCorum Group Ltd.
ChairmanWorld Financial Symposiums
World Financial Symposiums
Corum Group Presentation ■ 28
Nat joined Corum in 1996 and brings a diverse background in technology M&A and law. While with the Enforcement Division of
the U.S. Securities and Exchange Commission, Nat helped identify and build cases against securities fraud schemes. With the
Strategic Development Division of Morgan Stanley's M&A group, Nat worked on cross-border acquisitions of U.S. and European
companies by Japanese firms, and on financings by large Japanese public companies. Nat moved to Morgan Stanley's Tokyo
office, where he reported directly to the President of Morgan Stanley, Japan Ltd. and focused exclusively on cross-border M&A.
After Morgan Stanley, Nat co-founded Postcard Software, a creator of advertiser-driven bilingual (English and Japanese) Internet
content. At Activision, Nat lead the company's on-line business development.
Nat earned an undergraduate degree in Japanese literature from Yale College and a law degree from UCLA. While in law school,
Nat wrote articles for the International Forum at Yale, Tokyo Journal. Nat is frequently quoted in industry publications, a highly
sought speaker at industry conferences, and Chairman of the World Financial Symposiums.
Corum Group Presentation ■ 29London – November 17
Partial Speaker List
December 15, New York – info@worldfinancialsymposiums.com
Corum Group Presentation ■ 30
David VirnelliIBM
Jeff BrennanPitney Bowes
Jeff HoffmeisterMorgan Stanley NY
Arun PrakashVirgo Capital
Ryan Ziegler Edison Ventures
Peter CoffeeSalesforce.com
Greg OsinoffRenewData
www.worldfinancialsymposiums.com
Growth and Exit Strategies Staging for Recovery
The Future of M&A, VC, Private Equity and Public Offerings in the New Tech Landscape
December 15, 2009 � New York
Corum Group Presentation ■ 31
December 15, 2009 � New YorkAttend this conference to learn about:
� Raising capital in the current environment � The new rules of global tech M&A � The role of private equity in a credit-starved market � The IPO window � Creative transaction structures � Finding value and opportunity in the cloud � Acquisition multiples, VC tactics and more
Upcoming Corum Events
December 3: Flash Webinar – (Int’l)
December 8: London – SUSO
December 10: Flash Webinar (Nordic)
December 15: New York City – WFS
January 7: Flash Webinar – (Int’l)
January 21: Flash Webinar – (Nordic)
January 25-27:Miami – Progress Conference
January 28: Flash Webinar (DACH)
February 4: Flash Webinar – (Int’l)
February 16: Dallas – MB
Corum Group Presentation ■ 32
January 7: Flash Webinar – (Int’l)
January 12: Toronto – MB & SUSO
January 14: Flash Webinar (France)
January 14: Ottawa – MB
January 15: Montreal – MB
January 19: Calgary – MB
Merge Briefing (MB)Selling Up Selling Out (SUSO)World Financial Symposium (WFS)
February 16: Dallas – MB
February 18: Bellevue – SUSO
March 2: Houston – MB
March 4: Flash Webinar – (Int’l)
March 28: Oslo – SUSO
March 21: San Francisco – MB
Contact Information
Corum Group Ltd.
Bruce Milne, CEObrucem@corumgroup.com
Dougan Milne, Director of Researchdouganm@corumgroup.com Corum Group International S.à.r.l.
Corum Group Presentation ■ 33
Research and Conferences:www.corumgroup.com
10500 NE 8th Street, Suite 1500Bellevue, WA 98004USA
+1 425-455-8281
Corum Group International S.à.r.l.
Beim ParadeplatzBasteiplatz 78001 ZürichSwitzerland
+41 44 251 82 65
top related