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8/8/2019 Software and IT Industry Market Update - February M&A Flash Report
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USA Switzerland Germany France United Kingdom Canada Norway Brazil
M&A Flash Re ortM&A Flash Re ort Februar 2010Februar 2010Software and IT Industry Market Update
Thursday, February 4th, 201010:00 am PT
www.corumgroup.com
8/8/2019 Software and IT Industry Market Update - February M&A Flash Report
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Presenters
Bruce MilneCEOCorum Group Ltd.
Mark ReedExecutive Vice PresidentCorum Group Ltd.
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 com anies includin AMI the worlds lar est vertical market Dou an Milne
, ,software firm, and was a founding investor in some of the most innovative firms in their field, includingBlue 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 onthe board of Washington Technology Center at the University of Washington, and is the founder of theWTIA, the nations leading regional technology trade association.
Director of ResearchCorum Group Ltd.
Outside the U.S. he worked with the Canadian government to found SoftWorld, and he was recentlychosen 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 Europes.
A Deans List graduate in International Business from the UW, and a graduate With Distinction fromHarvard Business School, Mr. Milne has written three book, including Power Planning, How To Structure
Rob AdamsSr. DirectorCorporate Development
Corum Group Presentation 2
>> For todays presentation or more information, contact Pat Sultan
([email protected], +1 425-455-8281 ext. 248)
Your Software Company For Success.
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Agenda
Overview of Current Global Market
Market and Valuation Analysis
Rob Adams - Cisco
os ng ommen s -
Corum Group Presentation 3
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8/8/2019 Software and IT Industry Market Update - February M&A Flash Report
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Euro Zone
Possibility of Greece Defaulting on Debt
Euro zone Issues Record 110 Billion Euros in Bonds
Spains Official Jobless Tops 4 Million
ees ow ecovery er ss ng um ers
Euro Proving No Reserve Alternative
Corum Group Presentation 5
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U.S. Deficits and Taxes
Record $1.6 Trillion Deficit This Year
Geitner Long Term Deficits Pose Corrosive Threat
Obama Has $1.9 Trillion Tax Rise For Rich
ama r es ou a ore gn ax ar ors
Obama Plans $30bn Small Business Aid
Corum Group Presentation 6
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U.S. Economic Expansion
U.S. Manufacturing Expands More Than Expected
Corporate Spending Rises Most Since 2006
Ford U.S. Sales Rise 25%
en ng a es . . omes ncrease
US Cut 22,000 Jobs in January Lowest in Two Years
(ADP)
Corum Group Presentation 7
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Commodities
Commodities Rally Real, Rand Strengthen
Rubber Prices Reach 56 Year High
Oil Holds Steady
o ac o unce
Corum Group Presentation 8
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Growth, But
Roubini sees very Dismal U.S. Growth
El Arian says Retreat in Stocks will Worsen US,
Worst yet to come for Commercial Real Estate
Service Industry Grows at Slower Pace thanExpected
ummers a s o uman ecess on
Corum Group Presentation 9
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Technology
of Google Phone
Cisco Profits Exceed Estimates
Microsoft Bing Gains Ground
Comcast Beats Estimates
Cisco to hire 3000
Corum Group Presentation 10
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Corum Deals - 3 Closings in Last 45 Days
SaaS medical staffing space
er ca uca on
Software focused on secondary educational
Infrastructure Network Management
technology
Corum Group Presentation 11
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Corum - LOI and Offers
-
Vertical Financial Services
Corum - Offers being negotiated
Horizontal Content Management
Horizontal Business Intelli ence
Corum Group Presentation 12
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Market Valuation Analysis
Dougan MilneDirector of Research
Corum Group Ltd.
.his time with Corum, Dougan spent three years working with Corum's international groupheadquartered in Zrich, Switzerland. Prior to joining Corum's team in 2005, Dougan spentthree years working in the banking industry with Bank of America, and Citigroup's PrivateWealth 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 ofSan Diego.
Corum Group Presentation 13
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Public Markets
Nasda S&PTech Dow
110.00
120.00
90.00
100.00
70.00
80.00
50.00
60.00
Corum Group Presentation 14
.
Jan09 Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09 Oct09 Nov09 Dec09 Jan10
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M&A Activity January
Number of Software and IT M&A Transactions
296
373
333
209
January
321
0 50 100 150 200 250 300 350 400
Corum Group Presentation 15
2010 2009 2008 2007 2006 2005 2004
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Corum Index M&A Statistics
#ofTransactions
Jan09
214Jan
08
333Jan
10
296
LargestDeal
AverageDealSize
MedianSeller
Size
$775
$62
$15
$8,500
$134
$29
$2,000
$73
$25
#VCbackedExits
%TermsUndisclosed
AllCash(announced)
23
84%
56%
40
60%
45%
37
79%
55%
%Public
Buyers 43%61% 48%
Corum Group Presentation 16
$ values in millions
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Horizontal Application Software Market
Public Valuations
Horizontal
Application
Software
Jan0 9 Fe b
09 Mar
09 Apr
09 May
09 Jun
09 Jul
09 Aug
09 Sep
09 Oc t
09 Nov
09 Dec
09 Jan
10
EV/EBITDA 7.69x 5.85x 6.82x 9.23x 9.39x 9.99x 11.06x 11.06x 12.67x 12.26x 11.66x 11.67x 10.76x
EV/S 1.04x 1.12x 1.12x 1.16x 1.35x 1.50x 1.58x 1.93x 2.41x 2.21x 2.29x 2.41x 2.48x
Corum Group Presentation 17
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Vertical Application Software Market
Public Valuations
Vertical
Application
Jan09 Fe b09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09 Oc t09 Nov09 Dec09 Jan10
EV/EBITDA 6.92x 6.19x 6.53x 7.26x 7.99x 8.17x 8.91x 9.01x 9.32x 8.42x 8.96x 9.54x 9.37x
EV/S 1.26x 1.01x 1.14x 1.31x 1.40x 1.51x 1.51x 1.66x 1.80x 1.57x 1.82x 2.01x 1.90x
Corum Group Presentation 18
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Consumer Application Software Market
Public Valuations
ConsumerA lication
Software
Jan09 Feb09 Mar0 9 A pr09 May09 Jun09 Jul09 Aug0 9 Se p09 Oct09 Nov0 9 De c0 9 Jan10
EV/EBITDA 5.41x 2.40x 2.74x 3.81x 2.83x 4.47x 4.57x 4.27x 5.88x 5.23x 5.71x 4.91x 4.89x
EV/S 0.61x 0.58x 0.64x 0.69x 0.50x 0.53x 0.53x 0.59x 0.83x 0.60x 0.61x 0.70x 0.66x
Corum Group Presentation 19
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Infrastructure Market
Public Valuations
Infrastructure
Software
Jan09 Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Se p09 Oct09 Nov09 De c09 Jan10
EV/EBITDA 6.47x 6.32x 6.98x 8.46x 8.29x 8.74x 9.59x 10.92x 10.46x 10.81x 9.76x 11.61x 10.26x
EV/S 1.47x 1.31x 1.43x 1.55x 1.52x 1.72x 1.95x 2.02x 2.14x 2.20x 2.27x 2.37x 2.30x
Corum Group Presentation 20
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Internet Market
Public Valuations
Internet
Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09 Oct09 Nov09 Dec09 Jan10
EV/EBITDA 6.05x 7.54x 9.80x 11.78x 1 1.8 1x 1 3.32x 13 .02x 15.80x 1 1.81x 1 3.0 3x 15 .13x 14.40x
EV/S 1.36x 1.60x 2.11x 2.26x 2.30x 2.48x 2.60x 2.70x 2.19x 2.45x 2.55x 2.34x
Corum Group Presentation 21
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IT Services Market
Public Valuations
IT Services
Jan09 Feb09 Mar09 A pr09 May0 9 Jun09 Jul09 Aug0 9 Sep09 Oct0 9 Nov0 9 Dec0 9 Jan10
EV/EBITDA 5.36x 5.27x 5.32x 5.76x 5.51x 5.24x 5.56x 5.67x 6.66x 6.10x 6.16x 6.60x 6.44x
EV/S 0.70x 0.55x 0.56x 0.60x 0.61x 0.63x 0.68x 0.68x 0.73x 0.73x 0.63x 0.67x 0.81x
Corum Group Presentation 22
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Deal Spotlight January 2010
Deal Spotlight:Deal Spotlight:Deal Spotlight:
or zonta ert ca onsumer
ector: am ngTarget: nedplayBuyer: 32Red Plc
Date: January 2010Transaction Value: N/A
ector: ea t careTarget: Unisys HIM DivisionBuyer: Molina Healthcare
Date: January 2010Transaction Value: $135m
Sector: ERPTarget: Jiama Info SystemsBuyer: Kingdee Software Group
Date: January 2010
Comments: Market Consolidation
Metrics: 1.2x, cash
Comments: Unisys Sell-Off
.
Comments: Verticalization Real Estate
New Revenue Stream on nue onso a on Hot Buyer!
Others:
Others:
Others:
Corum Group Presentation 23
Orc Software Neonet AB Educomp StudyPlace.com
Time Inc. Stylefeeder Lace Group Mamba Games
Authoria PeopleClick.com ATG InstantService, Inc.
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Deal Spotlight January 2010
Deal Spotlight:Deal Spotlight:Deal Spotlight:
n rastructure nternet erv ces
Sector: Integration ServicesTarget: CimacBuyer: Schneider Electric
Date: January 2010
Sector: SEO / MarketingTarget: Innovation InteractiveBuyer: Dentsu
Date: January 2010
Sector: BPMTarget: SavvionBuyer: Progress Software
Date: January 2010
Comments: Geographic expansion
Comments: Traditional Advertising
Metrics: 2.3x TTM Revenues
Comments: BPM expertise
oma n expert seMulti-National
150+ employees 300+ enterprise clients
Others: LivePerson Nuconomy
Others: Emdeon FutureVision
Others: Good Technology CloudSync
Corum Group Presentation 24
StockTwits Abnormal Return Mobixell 724 Solutions
Cicero SOAdesk
Aonix Artisan Software Tools
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The Cisco Perspective
Rob AdamsSr. Director, Corporate Development
Rob Adams is the Senior Director of Corporate Development at Cisco Systems. He joined, , ,Technology Strategist, and Director of Strategic Alliances. Prior to joining Cisco, Rob was aSoftware Engineer for TGV, Inc., Progress Software, and Digital Equipment Corporation.
Rob has an undergraduate degree in Computer Science from Penn State University and anxecu ve rom arvar us ness c oo .
Corum Group Presentation 25
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Upcoming Corum Events
February 18: Bothell SUSO
March 2: Houston MB
March 16: Lyon MB
March 16: Denver SUSO
March 3: PE Breakfast Stockholm
March 4: Flash Webinar (Intl)
March 9: Dallas SUSO
March 18: SLC MB
March 23: Dublin SUSO
March 25: Santa Rosa MB
Merge Briefing (MB)Selling Up Selling Out (SUSO)World Financial Symposium (WFS)
Corum Group Presentation 26
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SUSO Agenda
Selling Up / Selling Out: Overview
Preparation: Internal Due Diligence
Valuations: Methodologies
ruc ure: e er o n en
Negotiation: LOI to Closing
Corum Group Presentation 27
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February 18 SUSO in Bothell, WA
- .
members. (Complimentary to past attendees of Corum'sWebinars or Conferences).
,will be hosting an Open House event at our new facility inBothell, WA. Whether you attend the conference or not, plan to
other local technology executives.
Time: SUSO Conference 1-5 PM, Open House 5-7 PM
., ,
300, Bothell, WA 98011
Registration: Go to http://www.corumgroup.com/Events.aspx
Corum Group Presentation 28
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Contact Information
Corum Group Ltd.
Bruce Milne, [email protected]
19805 North Creek Parkway
Suite 300 Corum Group International S..r.l.Bothell, WA 98011USA
+1 425-455-8281
Buechenstr. 9CH-8185 WinkelSwitzerland
+41 43 888 7590
Corum Group Presentation 29
www.corumgroup.com