M&A Snapshot Q3 2011

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M&ASNAPSHOTQ3 2011

OCTOBER 2011

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M&ASNAPSHOT

OVERVIEW COMMENTARYM&A activity in Q3 2011 continues to show good overall tone although as weexit the quarter general economic worries are beginning to warrant caution.

Within the important $25 million - $1 billion transaction value range, M&Avolume (62 transactions) and total consideration paid ($11 billion) wereroughly equivalent to Q2.

The marquee deal of the quarter was clearly Googles $12b acquisition ofMotorola Mobility. As has been the case for the past couple of years, Googleremains the most active acquirer in the quarter with seven acquisitions. Inaddition to Motorola, acquisitions include Zagat (crowd sourced local businessreview), Daily Deal (local deals), Zave Networks (coupon redemption),Centerd (local deals), Punchd (mobile loyalty cards) and Fridge (a socialnetwork). Googles M&A efforts continue to largely be focused on enhancingconsumer engagement on mobile devices, thereby improving Googlesmarketing and advertising monetization opportunities. Social, Local andMobile (SoLoMo) are consistent themes.

Overall, digital marketing, e and m-commerce and marketing analyticscontinue to be an extremely active M&A theme and comprises roughly 25% ofthe activity within the $25mm-$1b transaction size range.

Traditional IT vendors also continue to position themselves to address theproliferation of mobile devices, cloud-based services and applications,integrating social and location awareness into a wide range of applicationsand enabling intelligently targeted marketing and advertising.

This past quarter, Architect Partners has published its M&A Alert on eleven ofthe most strategic transactions in the quarter.

FOLLOWING ANALYSIS

M&ADASHBOARD:

NOTABLE ACQUIRERS:

M&ATRANSACTIONS:

OTHER NOTABLE TRANSACTIONS:

COMING SOON

ANALYSIS OF VC-BACKED M&AEXITS

SUMMARY OF QUARTERLY ACTIVITY INNUMBERS AND TONE

ACTIVE INFLUENTIAL BUYER ACTIVITY

SUMMARY OF TRANSACTIONS BETWEEN$25MM-$1B IN VALUE

SUMMARY OF NOTABLE TRANSACTIONSWITHOUT ANNOUNCED VALUE ORABOVE $1B.

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COVERAGEArchitect Partners tracks M&A activity within the convergingInternet | mobile | digital media sectors. The following

assessment is focused on M&A transactions with announcedvalues of between $25mm and $1B as these typically

represent successful business-building endeavors.

MARKET TONEGood. Deepening base of acquirers.Transaction volume solid. Generally

balanced buyer/seller dynamics.

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

3

M&A Exits (#)...........................................................................................

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

Venture-Backed M&A Exits (#)..................................... ......................

Median Transaction Size ($mm)..................................... ....................

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

All Internet | Mobile | Digital Media M&A Exits(1)(#).....................

2010

Q1 Q2 Q3 Q4

45%

55%52%

49%

$6 $5

$12 $12

38 40

68

53

$75

$100 $98 $105

2011

Q1 Q2 Q3

12

17 18 16

!"#$$ !%#$$ !"&$!'($

!"#$ !%&$ !"'$

$14$12

$11

48% 49%52%

M&ADASHBOARD

6861 63

27

23 23

$98$113

$80

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NOTABLEACQUIRERS

The following acquirers are generally active or influential buyers within the Internet | mobile | digital media sectors. Below,

we highlight announced acquisitions in the third quarter of 2011.

4

ACQUIRER # TARGET

7

3

3

3

3

3

2

2

2

2

2

2

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NOTABLEACQUIRERS (continued)

5

ACQUIRER # TARGET

2

2

2

2

2

2

2

1

1

1

1

1

1

1

Video Processing Asset

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#

ANNOUNCED

DATE BUYER TARGET

TRANSACTION

VALUE ($MM) TARGET DESCRIPTION

AP

INSIGHTSM

M&A ALERT

VC-

BACKED

NON-SERVICE PROVIDER TRANSACTIONS

1 08/03/2011 Web.com Group Network Solutions $756 Provides domain registration and hosting services.

!

2 09/14/2011 Teradyne LitePoint $580 Develops wireless test solutions for WLAN, WiMax and WiFi devices.

!

3 08/17/2011 Wi-Lan MOSAID Technologies $464 Engages in licensing and developing patented semiconductor andwireless/wireline communications IP technology.

4 09/15/2011 Pearson Connections Education $400 Operates online or 'virtual' classes for public schools.

5 07/21/2011 Acer iGware $395 Provides cloud computing services for more than 100 million consumer devices.

6 09/01/2011 IBM Algorithmics $387 Provides financial risk analytics software and advisory services. Algorithmicsenables financial services companies to quantify, manage and optimize their risk

exposure across a range of financial risk areas such as market, liquidity, credit,operational, economic and regulatory requirements, and make effective businessdecisions.

7 09/15/2011 Bserv Fundtech $353 Provides financial transaction processing software for financial institutions.

8 09/29/2011 Intel Telmap $325 Provides location-based services enabling mobile operators to offer mobilelocation-based services such as local search, mapping and navigation services

across multiple mobile OS.

9 07/06/2011 HTC S3 Graphics $300 Provides graphics visualization products including graphics processors, desktopcards, integrated chipsets and drivers for mobile devices.

10 08/01/2011 ValueClick Dotomi $295 Helps online retailers create and deliver dynamic display advertising campaignswhere the ad creatives and media placements are dynamically adapted in real timebased on a number of variables including: geographic location, time of day,language, and behavioral characteristics of the user, among others.

!

11 08/02/2011 GTCR Golder Rauner Global Traffic Network $277 Provides traffic and news information reports to radio and television stations.

12 07/07/2011 eBay Zong $240 Provides a payment solution which allows consumers to pay for on-line digital

goods purchases using their mobile phone number. !

13 09/23/2011 HgCapital Group NBT $231 Provides domain name, Web hosting and Internet related services.

!

14 09/16/2011 King Capital

International

Rising India $214 Engages in the development and production of digital special effects and 3D

character animation for films and TV production.

15 07/12/2011 Citrix Cloud.com $200+ Develops open source software solution that accelerates the deployment,management, and configuration of multi-tier and multi-tenant infrastructure cloud

services. !

M&ATRANSACTIONS: $25MM-$1B

Below highlights M&A transactions that have announced values of between $25mm and $1b announced in Q3 2011 within theconverging Internet | mobile | digital media sectors.

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Note: Transaction values within a range are presented as a mid-point value

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#

ANNOUNCED

DATE BUYER TARGET

TRANSACTION

VA LUE ($M M) TA RG ET DESC RIPT IO N

AP

INSIGHTSM

M&A ALERT

VC-

BACKED

16 07/07/2011 MIH Allegro Markafoni $200 Online private shopping club that offers apparel, accessories, sporting goods,cosmetics, toys and technology products.

1 7 07/1 4/201 1 An undiscl ose d buyer C3 Te chnologie s $155 Provides det ailed 3D city v isualizat ion solutions for Web map publi shers and re alestate portals. Offers a street level 3D imagery solution and Interior Panoramas that

provides interior views of restaurants, shopping malls, hotels.

!

18 09/05/2011 Vivendi See Group $151 Offers ticket booking services for theatres, comedy shows, sports, music shows andvarious events.

19 07/19/2011 Riverbed Technology Zeus Technology $125 Offers load balancing and traffic management software that enable companies tosubstantially improve the performance of their cloud-delivered applications andwebsites.

!

20 09/08/201 1 Google Zagat $125 Provides user-generate d rat ings and reviews for restaurant s and local busi nessessuch as hotels, retailers and other vendors.

!

21 08/08/2011 Great Hill Partners Plimus $115 Provides a hosted outsourced e-commerce platform for selling software, gamesand other digital goods online.

22 07/19/2011 Quepasa Insider Guides $97 Operates myYearbook.com, an online social network for teenagers and highschoolstudents. !

23 09/28/2011 Pendrell ContentGuard $90 Develops and licenses DRM and content distribution technologies.

24 09/26/2011 Renren QianJun $80 A social video sharing site.

!

25 09/19/2011 NICE Systems The Fizzback Group $80 Provides a customer engagement soluti on t hat help companie s to l isten, re spond,and act in real-time to their customers' comments. !

26 07/19/2011 Verint Systems Vovici $76 Provides online survey software, enterprise feedback management, onlinecommunity software and survey analytics software solutions. !

27 08/13/2011 NuanceCommunications

Loquendo $75 Provides speech recognition and speech synthesis technologies.

28 08/22/2011 RealPage Multifamily TechnologySolutions

$74 Operates MyNewPlace.com, an apartment and home rentals listing servicesaccessible via Web, mobile Web and iPhone/iPod Touch. !

29 07/08/2011 CAG Digital InvestmentHoldings

G DC Techno lo gy $73 O ffe rs softwa re-ba sed digi ta l c inem a solut io ns fo r d igi tal po st -prod uct ion , de li ve ryand exhibitions of movies and onscreen advertisement.

30 08/03/2011 Augme Technologies Hipcricket $72 A mobile marketing company.

M&ATRANSACTIONS: $25MM-$1B (continued)

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#

ANNOUNCED

DATE BUYER TARGET

TRANSACTION

VA LUE ($M M) TA RG ET DESC RIPT IO N

AP

INSIGHTSM

M&A ALERT

VC-

BACKED

31 08/30/2011 DG FastChannel EyeWonder $66 Provides interactive online video advertising solutions and video advertisingplatforms that enable advertising agencies and content publishers to create,deliver, manage, and optimize their interactive digital advertising campaigns.

32 08/21/2011 Skype GroupMe $64 Develops a mobile group text messaging and voice calling application. GroupMeallows users to create private groups of up to 25 friends and text chat (via textmessages delivered via mobile application or SMS), set up voice calls, share photos

and locate friends on a map.!

33 08/14/2011 ECI Partners Wireless Logic $57 Offers M2M communication solutions, connecting embedded sensing devices inmachines via SIM-based technology.

34 08/03/2011 Michael Yufeng Chi,Chairman and ChiefExecutive Officer ofPerfect World

Beijing Perfect WorldCultural Communication

$56 A media and entertainment company engaged in producing movies.

35 07/28/2011 Inrix ITIS $55 Provides real-time traffic and travel information to assist motorists. ITIS collectstraffic flow and incident data from cellular phone networks and GPS devices, fixed-sensor systems and incident reports.

!

36 09/21/2011 Salesforce Assistly $50 Operates a multi-channel customer support platform. Feeds customer serviceconversations into single collaborative desktop where service requests throughtraditional and social channels are collected and handled by the customer supportteam.

!

37 09/29/2011 NeoPhotonics Santur $47 Develops and manufactures optical network devices for the telecommunicationsindustry. !

38 08/01/2011 IncrediMail Smilebox $40 Provides an online service that connects its users with family and friends usingphotos and videos.

!

39 09/21/2011 Rakuten Play $39 Operates as an online retailer of DVD, CD and games.

40 07/01/2011 Logicalis Group Netarx $34 Develops unified communication solution including mobile voice, data, and visualcommunications on an IP-based network.

41 07/20/2011 Playtech Mobenga $34 Develops mobile sports betting software. !

42 07/08/2011 Local.com Screamin Media $33 Offers discount deals on restaurants, spas, and events to customers, localbusinesses, and community schools.

43 0 9/ 16 /20 11 Digi ta l A ri a The C ha inG $3 2 Enga ges i n the deve lopm ent, pro duct io n, and di st ribu tion o f tel ev is io n dra maseries and motion pictures.

44 08/02/2011 Glu Mobile Griptonite $31 Develops fun games for console and handheld platforms.

45 0 8/2 2/20 11 Ci sco Sys tems A xiom Sys tems $3 1 O ffers I P ser vi ce ful fi llment sof twa re wh ich al lows o perators to a uto ma te themanagement of network services.


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#

ANNOUNCED

DATE BUYER TARGET

TRANSACTION

VALUE ($MM) TARGET DESCRIPTION

AP

INSIGHT SM

M&A ALERT

VC-

BACKED

46 09/20/2011 Serve VirtualEnterprises

Sometrics $30 A social media analytics and ad platform company.

!

47 07/24/2011 Matomy Media Adperio $30 Interactive advertising agency. Provides services in areas including social media,banners, Web displays, email and mobile marketing. Offers an online loyaltyprogram to create custom panels.

48 07/14/2011 Affinion Group Prospectiv Direct $30 Provides online marketing solutions incuding customer acquisition, lead generationand email marketing.

49 09/14/2011 St. Ives Response One $30 Offers data-driven digital marketing services.

50 09/11/2011 8x8 Contactual $28 Provides cloud-based call center and customer interaction management solutions.

!

51 09/14/2011 Hong Kong EconomicTimes Holdings

Ringier Print $28 A magazine publishing company.

52 07/01/2011 Irdeto Rovi Corporation, BD+Business

$25 Enables studios to protect high definition Blu-ray Disc content.


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10


#

ANNOUNCED

DATE BUYER TARGET

TRANSACTION

VA LU E ( $MM ) TAR GE T DE SC RI PTI ON

AP

INSIGHTSM

M&A ALERT

VC-

BACKED

SERVICE PROVIDER TRANSACTIONS

1 08/01/2011 Astrium Vizada $960 Provides mobile satellite services at sea, on land, and in flight in France andinternationally.

2 09/08/2011 Groupe CANAL+ Bollore, TV Business $652 Free-to air TV broadcast based in France.

3 07/28/2011 DMT Elettronica Industr iale $494 Engages in the production and management of television networks in Italy.

4 09/29/2011 Netia Telefonia Dialog $292 A telecom operator in Poland.

5 07/04/2011 Hunan TV & BroadcastIntermediary

Majority Stake in HunanHuixin and Hunan Huideand Hunan Huiyue andHunan Huirun CableNetwork

$208 Cable TV network in China.

6 09/08/2011 Sinclair BroadcastGroup

Four Points MediaGroup

$200 Operates television stations based in Salt Lake City, Utah.

7 09/19/2011 Narodowy FunduszInwestycyjny Midas

Aero 2 $171 Offers wireless telecommunications and internet services through 900 MHz bandnetwork based on HSPA+ technology. Poland-based.

8 07/22/2011 Tele2 Sverige Network Norway $140 Offers mobile broadband and mobile data services in Norway.

!

9 08/24/2011 WideOpenWest Broadstripe MichiganAssets

$55 Digital cable and broadband Internet services.

10 08/24/2011 Wave Broadband Broadstripe Washingtonand Oregon Properties

$32 Digital cable and broadband Internet services

11 09/29/2011 Netia Crowley Data Poland $32 Provides telecommunication services in Poland.

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A number of important transactions were announced in the third quarter of 2011 with consideration in excess of $1b or with

unannounced transaction values.

M&ATRANSACTIONS: OTHER NOTABLE


# ANNOUNCEDDATE BUYER TARGET TRANSACTIONVA LU E ($ MM ) TA RG ET D ES CR IP TIO N AP INSIGHTSM

M&A ALERT VC-BACKED1 08/ 15/2011 Google Moto rola Mobility $12,033 Manufactures and markets Android mo bile phones, tablets and home networking

devices including cable modems, set-top-boxes.

2 08/15/2011 Time Warner Cable Insight Communications $4,789 Provides high-speed Internet, voice and cable TV services.

3 09/11/2011 Broadcom NetLogic Microsystems $3,661 Develops semicondctor chips and integrated circuits used in mobile wirelessinfrastructure, data center, enterprise, metro Ethernet and infrastructure networks.

4 07/11/2011 Electronic Arts PopCap Games $1,025 A video game and Internet game developer and publisher and a leader in the fast-

growing $3B+ casual gaming segment. !

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Documents

M&A Snapshot Q3 2011