1. technology and computing
2. software

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www.petskyprunier.com  [email protected]
FOR IMMEDIATE RELEASE
Contact: Amy LaBan
212 842-7126
[email protected]
1Q15 Review of M&A and Investment Activity in the
Software, Information, and Business Services Industries:
468 Transactions Totaling a Reported $20.2 Billion
Software was the Most Active and Highest Value Segment in 1Q15
with 333 Transactions Totaling $12.9 Billion in Reported Deal Value
March 31, 2014 New York, NY – During 1Q15, Petsky Prunier tracked 468 M&A and investment transactions for a
total of $20.2 billion across three broad segments: Software, Information, and Business Services. Software was the
most active segment, accounting for 71 percent of total volume during the quarter, with 333 deals announced. Of
those, 203 reported $12.9 billion in value. The Information and Business Services segments reported values of $3.4
billion and $3.8 billion, respectively, in 1Q15.
M ARKETING, M EDIA, TECHNOLOGY AND SERVICE INDUSTRIES
MARKETING, MEDIA, TECHNOLOGY AND SERVICE INDUSTRIES
MARKETING,
TECHNOLOGY
ANDServices
SERVICEIndustries
INDUSTRIES
Software, MEDIA,
Information,
and Business
1H12 M &A AND INVESTMENT ACTIVITY
2Q12
M&A
AND
INVESTMENT
ACTIVITY
1Q15
M&A
and
Investment Activity
Software
Software
,,and
Information,
Information
and
&BusinessServices
BusinessServices
Industries
Industries
M&A
AND
INVESTMENT
ACTIVITY: 1Q11
- 2Q12
($ in Millions)
1Q14-1Q15 M&A and Investment Activity
($ in Billions)
($
($ in
in Millions)
Millions)
($ in Billions)
Information
$3,435
$43.7
DOLLAR
VALUE
$42.3
WhatsApp/
Facebook
Software
$12,945
$30.9
$26.1
$20.2
DEAL
VOLUME
742
468
494
528
468
1Q14
2Q14
3Q14
4Q14
1Q15
Business
Services
$3,774
M&A Activity
Acquisitions accounted for 49 percent of total transactions in 1Q15. Of the 227 acquisitions announced, 45 were
reported for $15.8 billion in aggregate value. Compared to the previous quarter, M&A volume was flat and reported
value decreased 22 percent. Software was the most active M&A segment in 1Q15 with 146 transactions, of which 31
were worth $9.4 billion. Volume was up 26 percent, and value more than doubled from the previous quarter. Nearly 20
percent of Software acquisitions were in the Financial Software subsegment with 27 deals, of which 10 reported $3.8
billion in value. Security Software was also active with 20 transactions with four worth a reported $2.5 billion.
Software acquisitions during 1Q15 included:
 SS&C Technologies Holdings’ $2.5 billion acquisition of investment management software and services provider
Advent Software at a valuation of 6.4x revenue
 Lexmark’s $1 billion acquisition of business process management software developer Kofax
Petsky Prunier’s 1Q15 Summary of M&A and Investment Activity
Software, Information, and Business Services Industries
Page 1
 The $547 million purchase of mobile networking software developer Mavenir Systems by Mitel Networks
 Insight Venture Partners’ $250 million take-private of supply chain management software developer E2Open at a
valuation of 3.2x revenue
 IT Services provider Infosys’ $200 million acquisition of enterprise resource planning software developer Panaya
The Information segment reported 20 M&A transactions, including three worth a reported $3.1 billion. More than half
of the acquisitions in the segment occurred within the Healthcare Information subsegment, with 11 transactions
announced. Transactions in the segment during 1Q15 included:
 Verisk Analytics’ $2.8 billion purchase of energy industry specialist Wood Mackenzie from Hellman & Friedman
 ZeOmega’s purchase of HealthUnity, a provider of interoperability health IT solutions
 Argus Media’s acquisition of metals market information provider MetalPrices.com
The Business Services segment had 61 M&A transactions during 1Q15, of which 11 were valued at $3.3 billion. The
IT Consulting/Systems Integration and Corporate Training subsegments accounted for nearly half the segment’s
activity and more than half its value. The Healthcare Consulting subsegment was also active with eight transactions,
including one worth $402 million. Business Services acquisitions during 1Q15 included:
 Harman International’s $780 million purchase of enterprise software engineering and integration services provider
Symphony Teleca
 The $675 million purchase of “hybrid infrastructure-as-a-solution” IT outsourcing provider Latisys by Zayo Group
 EmployBridge’s $410 million merge with The Select Family of Staffing Companies
 Catamaran’s $405 million purchase of Healthcare Solutions, a provider of healthcare services to the workers’
compensation market
Investment Activity
There were 241 investments announced in 1Q15, of which 220 were reported for $4.3 billion in aggregate value.
Software was the most active investment segment with 187 deals, of which 172 reported $3.5 billion in value. The
Financial Software and Security Software subsegments together accounted for 32 percent of the investment activity in
the segment during the quarter with 31 and 28 deals, respectively. Financial Software was the highest value
subsegment, worth a reported $908 million. Investments in the Software segment announced during 1Q15 included:
 Social lending software developer Social Finance’s $200 million round led by Third Point Capital with participation
from Welling Management Company and Institutional Venture Partners
 IT infrastructure developer SimpliVity’s $175 million round from Accel Partners, Charles River Ventures, Kleiner
Perkins Caufield & Byers, and Meritech Capital Partners
 Iconiq Capital’s $125 million investment in eDiscovery software developer kCura
 The $100 million round of funding by Francisco Partners of business application software developer K2
 The Temasek-led $60 million round for data analytics solutions developer Manhattan Software Services
Business Services reported 32 investments, of which 28 were worth $494 million in reported value. Investment
activity was driven by the Corporate Training and Financial Consulting subsegments, which accounted for half the
segment’s volume with nine and seven transactions, respectively. Investments in Business Services during 1Q15
included:
 Online training company Lynda.com’s $186 million round of funding at a reported valuation of $1 billion led by
TPG Capital, with participation from Accel Partners, Meritech Capital Partners, and Spectrum Equity
 The $90 million round of funding from Fidelity Management and Research in Oportun, a provider of financial
services to the Hispanic market
 Spark Capital’s $35 million investment in on-demand delivery services provider Postmates at a reported valuation of
$175 million
Petsky Prunier’s 1Q15 Summary of M&A and Investment Activity
Software, Information, and Business Services Industries
Page 2
Buyer & Investor Activity
1Q15 Most Active Strategic Buyers by Number of Transactions
Buyer
J2 Communications
LiquidHub
Microsoft
Accenture
Apple
Box
Dropbox
Number of
Transactions
3
3
3
2
2
2
2
Representative Targets
Excel Micro, Fristway Digital,SugarSync
ClosedWon, Harvest Solutions, RedKite
Equivio, Revolution Analytics, Sunrise Atelier
Gaspo, Structure Consulting Group
Camel Audio, FoundationDB
Airpost, Subspace
CloudOn, Pixelapse
Strategic buyers announced 200 deals, of which 41 were reported for $12.6 billion in aggregate value. Software was
the most active and highest value segment with 129 transactions 28 worth a reported value of $6.4 billion.
Buyout firms completed 27 acquisitions in 1Q15, down 10 percent from the 30 announced in 4Q14. Four of the
buyout transactions were reported for $3.3 billion in aggregate value. The Software segment accounted for 63 percent
of transaction activity. Buyout transactions in 1Q15 included:
 Bain Capital’s $2.4 billion acquisition of cybersecurity firm Blue Coat Systems from Thoma Bravo
 Bridgepoint Capital’s $340 million acquisition of alternative investment management software developer eFront
from Francisco Partners
 Vector Capital’s $266 million take private of Saba Software, a developer of enterprise talent management software
 The $250 million take-private of supply chain management software developer E2open by Insight Venture Partners
1Q15 Most Active Investors by Number of Transactions
Investor
New Enterprise Associates
Accel Partners
.406 Ventures
Andreessen Horowitz
Lightspeed Venture Partners
Sequoia Capital
Bessemer Venture Partners
Index Ventures
Number of
Transactions
7
6
5
5
5
5
4
4
Representative Targets
CollectiveHealth, Dato, FusionOps, Guidespark, Onshape, Pluribus Networks, ScienceLogic
Argo Technologies, BetterCloud, ClusterHQ, SimpliVity, UserTesting, WordRemit
Attend.com, CloudHealth, Mineral Tree, RevMetrix, Vaultive
Alation, Earnest Operations, Improbable Worlds, SignalFX, Tachyon Nexus
BlueVine Capital, Cloudbees, Highfive Technologies, Rubrik, SimplyTapp
FreeCharge, Practo Technologies, Rounds Entertainment, Springpath, Security Scorecard
Axarid Prime, Betterment, iSIGHT Partners, Team8
Adallom, Datadog, PeopleVox, TransferWire
Among venture and growth capital investors, reported volume and value decreased 17 and 25 percent, respectively, in
1Q15 compared to the previous quarter. New Enterprise Associates was the most active investor with seven
investments during the quarter with a total of $214 million in transactions. Accel Partners was the second most active
with six investments, worth $314 million.
IPO Activity
Box and Inovalon Holdings completed their IPOs in 1Q15, with both pricing at the high-end or above their initial
filing ranges. Apigee, Grey Cloak Technologies, Truven Health Analytics, and Veracode submitted their IPO filings in
1Q15 but have yet to price.
*All values as of 12pm ET on 3/30/2015. Transaction values include only reported up-front cash payments and do not
account for any potential future performance-based compensation
Petsky Prunier’s 1Q15 Summary of M&A and Investment Activity
Software, Information, and Business Services Industries
Page 3
Quarterly M&A and Investment Activity by Segment
Most Active Software Subsegments
4Q14
LTM
1Q15
1Q15 vs 4Q14
(% Change)
Subsegment
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
47
35
27
13
20
28
13
17
8
13
1,227
847
1,120
19
155
1,019
135
308
367
152
48
29
18
23
15
58
20
17
18
26
2,919
680
1,826
78
55
4,715
1,043
151
415
263
190
123
110
85
68
116
72
71
57
53
5,670
7,116
10,389
451
723
14,509
6,034
712
5,435
707
304%
251%
307%
554%
240%
314%
454%
318%
613%
308%
362%
741%
827%
2,263%
367%
1,324%
4,363%
131%
1,380%
364%
Subtotal
Other
221
63
5,350
1,012
272
61
12,145
800
945
247
51,747
5,330
23%
(3%)
127%
(21%)
Total
284
6,362
333
12,945
1,192
57,077
17%
103%
Security
Healthcare
ERP
Software Development Tools
HR
Financial
Infrastructure
Collaboration
Application Management
Data Management
"Other" includes Big Data. Cloud Computing, Credit/Risk , Engineering, Enterprise Mobility, Geo-Demo, Legal Software, Software Platform, and Virtualization
Most Active Business Services Subsegments
4Q14
LTM
1Q15
1Q15 vs 4Q14
(% Change)
Subsegment
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
IT Consulting/Systems Integration
Healthcare Consulting
Financial Consulting
Staffing
Fulfillment
Corporate Training
HR Consulting
BPO
Logistics
Contact Center
31
1
8
9
2
14
2
5
9
0
3,072
6
90
53
2,840
49
0
11
29
0
20
11
13
3
2
20
0
7
13
1
1,484
441
128
415
312
521
0
58
132
275
110
20
25
26
4
43
8
23
34
2
6,238
3,147
248
522
3,152
870
71
355
1,670
275
(35%)
1,000%
63%
(67%)
0%
43%
(100%)
40%
44%
NM
(52%)
7,071%
42%
690%
(89%)
960%
NM
405%
352%
NM
Subtotal
Other
81
5
6,151
20
90
3
3,766
8
295
21
16,548
1,628
11%
(40%)
(39%)
(61%)
Total
86
6,171
93
3,774
316
18,176
8%
(39%)
"Other" includes Credit/Risk Consulting, Data Processing/Enhancement, Engineering Consulting, Geo-Demo Consulting, HR Consulting, Legal Consulting, and Printing Services
Most Active Information Subsegments
4Q14
LTM
1Q15
1Q15 vc 4Q14
(% Change)
Subsegment
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
Number of
Transactions
Reported
Value ($MM)
Healthcare Information
Financial Information
Credit/Risk Management Information
Legal Information
HR Information
Product/Price Information
IT Information
Engineering/Scientific/Tech Information
Geo-Demographic Information
17
16
3
0
1
1
2
0
1
287
766
23
0
0
0
70
0
20
25
3
4
2
1
2
1
2
2
277
2
2,794
39
8
289
0
27
0
68
33
29
4
7
12
3
2
8
1,619
2,001
3,661
64
29
351
70
27
717
47%
(81%)
33%
NM
0%
100%
(50%)
NM
100%
(4%)
(100%)
12,048%
NM
NM
NM
(100%)
NM
(100%)
Subtotal
41
1,166
42
3,435
166
8,538
2%
195%
Total
41
1,166
42
3,435
166
8,538
2%
195%
About Petsky Prunier LLC
Petsky Prunier (www.petskyprunier.com) is one of the leading investment banks in the technology, media, marketing,
eCommerce, and healthcare industries. Our firm's mergers and acquisitions and private placements advisory services
reflect a unique blend of product specialization and industry expertise. Together with strategic consulting firm
Winterberry Group, a Petsky Prunier company, our organization represents one of the largest industry-specific
advisors providing strategic and transactional services. In addition, we offer international reach through our
partnership with Altium. Established for more than 20 years and privately owned, Altium is an international
investment bank operating from eight offices across Europe. Securities transactions are processed through Petsky
Prunier Securities LLC.
Petsky Prunier’s 1Q15 Summary of M&A and Investment Activity
Software, Information, and Business Services Industries
Page 4