1st Half 2018 Key Highlights
- The largest deal in 1st Half 2018 was private equity firm KKR’s announced acquisition of BMC Software, which offers cloud and IT management solutions to enterprises, for $8.5 billion. Of note, BMC was acquired in 2013 by a private investor group led by Bain Capital and Golden Gate Capital for $6.69 billion.
- There were 253 financially sponsored transactions with an aggregate value of $31.23 billion, representing 24 percent of the total volume and 37 percent of the total value, respectively.
1st Half 2018 Key Trends
- Total transaction volume in 1st Half 2018 declined by three percent over 2nd Half 2017, from 1,084 to 1,056.
- Total transaction value in 1st Half 2018 rose by 46 percent over 2nd Half 2017, from $57.88 billion to $84.43 billion.
- The median revenue multiple shifted from 2.7x in 2nd Half 2017 to 2.5x in 1st Half 2018. The median EBITDA multiple moved downward during this timeframe, from 13.7x to 11.4x.
- Both the Business and Infrastructure segments saw notable increases in volume during the half year period. Business volume gained 13 percent, from 201 to 228 transactions. Infrastructure volume rose 11 percent, from 143 to 159 transactions.
M&A Market Overview
Berkery Noyes tracked 5,382 Software transactions between 2016 and 1st Half 2018, of which 1,099 disclosed financial terms, and calculated the aggregate transaction value to be $280.05 billion. Based on known transaction values, we project values of 4,283 undisclosed transactions to be $98.30 billion, totaling $378.35 billion worth of transactions tracked over the past two and a half years.
Transactions from 1st Half 2016 to 1st Half 2018 with enterprise values above $160 million received a median revenue multiple of 4.0x, whereas those in the $20-160 million range garnered a median revenue multiple of 2.7x and those in the $10-$20 million range had a median revenue multiple of 2.0x.
Disclosed median enterprise value multiples for all segments combined in this report during the last 30 months were 2.6x revenue and 12.9x EBITDA.