1st Half 2017 Online & Mobile Industry Trends

1ST HALF 2017 KEY HIGHLIGHTS

• The largest E-Commerce deal in 1st Half 2017 was PetSmart’s acquisition of Chewy, an online retailer for pet products, for $3.35 billion.
• There were 242 financially sponsored transactions with an aggregate value of $17.74 billion, representing 17 percent of the total volume and 32 percent of the total value, respectively.

1ST HALF 2017 KEY TRENDS

• Total transaction volume in 1st Half 2017 increased by five percent over 2nd Half 2016, from 1,397 to 1,465. Of note, the number of private equity backed deals rose 21 percent, from 200 to 242.
• Total transaction value in 1st Half 2017 fell 37 percent over 2nd Half 2016, from $83.25 billion to $52.62 billion.
• The median revenue multiple moved slightly from 1.9x in 2nd Half 2016 to 1.8x in 1st Half 2017. The median EBITDA multiple declined from 11.7x in 2nd Half 2016 to 10.3x in 1st Half 2017.
• Transactions in 1st Half 2017 with enterprise values above $160 million received a median revenue multiple of 2.0x, whereas those in the $10-$20 million range had a median revenue multiple of 3.6x.
• The segment with the largest increase in volume in 1st Half 2017 over 2nd Half 2016 was Communications with a 15 percent rise, from 167 to 192 transactions. The E-Commerce segment was close behind with a 12 percent improvement, from 330 to 370 transactions.

M&A Market Overview

Berkery Noyes tracked 7,232 Online & Mobile transactions between 2015 and 1st Half 2017, of which 1,576 disclosed financial terms, and calculated the aggregate transaction value to be $292.36 billion. Based on known transaction values, we project values of 5,656 undisclosed transactions to be $99.07 billion, totaling $391.43 billion worth of transactions tracked over the past two and a half years.

Disclosed median enterprise value multiples for all segments combined in this report during the last 30 months were 2.1x revenue and 10.7x EBITDA.