2014-10-07 Berkery Noyes Releases Online and Mobile Industry M&A Report For Third Quarter 2014
- Send To
NEW YORK — October 7, 2014 — Berkery Noyes, an independent mid-market investment bank, today released its third quarter 2014 mergers and acquisitions trend report for the Online and Mobile Industry. The report analyzes M&A activity during the three-month period and compares it with data for the six previous quarters.
Total volume declined 12 percent, from 621 transactions in second quarter 2014 to 546 transactions in third quarter 2014. At the same time, aggregate value increased 74 percent, from $21.3 billion to $37.0 billion. When compared to the first three quarters of 2013, the number of deals year-to-date rose nine percent. SaaS & Cloud, which saw volume remain about the same on a quarter-to-quarter basis, was the most active market segment in third quarter 2014 with 158 transactions.
M&A activity in the E-Commerce declined 19 percent relative to second quarter 2014. Nonetheless, this represented a 13 percent rise year-to-date compared to same time period in 2013. Regarding deal value, there were several transactions in the segment that reached the $1 billion threshold during the past quarter. This consisted of Zillow’s acquisition of online real estate website Trulia for $2.9 billion; Gannett’s acquisition of Classified Ventures, which owns Cars.com, for $1.8 billion; Ingenico Group’s acquisition of payment service provider GlobalCollect for $1.1 billion; and Rakuten’s acquisition of shopping website Ebates for $1 billion.
As for the E-Marketing & Search segment, deal volume decreased 18 percent on a quarterly basis. However, the number of segment deals year-to-date rose 21 percent compared to the corresponding timeframe in 2013. Transactions in the segment by notable acquirers in third quarter 2014 included Alliance Data Systems’ acquisition of Conversant, a digital marketing company, for $2.3 billion; Rocket Fuel’s acquisition of [x+1], a provider of programmatic marketing and data management solutions, for $236 million; LinkedIn’s acquisition of Bizo, a B2B audience targeting platform and advertising network, for a reported $175 million; and Millennial Media’s acquisition of Nexage, a provider of real-time bidding (RTB) technology, for $108 million.
Acquirers are also continuing to show strong interest in mobile analytics. One example in third quarter 2014 was Yahoo!’s acquisition of Flurry, with a reported purchase price between $200 and $300 million. In terms of high profile private equity backed companies in the online analytics space, Vocus and Cision acquired Visible Technologies, a social media monitoring and analytics firm. This was the first acquisition by Vocus and Cision after being combined by private equity firm GTCR in second quarter 2014.
Major players in the travel sector have been active Online and Mobile acquirers thus far in 2014. This included Expedia’s third quarter acquisition of Wotif Group, an Australian based operator of online travel brands in the Asia-Pacific region, for $499 million. Another notable transaction in the sector was TripAdvisor’s acquisition of Viator for $200 million, which was TripAdvisor’s fourth industry transaction year-to-date and the largest deal ever completed by the company. Viator provides travelers with online and mobile access to thousands of tours and activities, as well as traveler submitted reviews, photos, and videos.
Transaction volume in the Communications segment, after rising 33 percent from first to second quarter 2014, declined 30 percent in the third quarter. Blackberry, as it looks to build its portfolio of value added services, completed several mobile-based transactions in the quarter with the acquisition of Movirtu, a provider of virtual identity solutions; and Secusmart, a security voice and data encryption company. These were Blackberry’s first acquisitions since 2011.
“Strategic buyers and investors are looking at acquisitions and investments to either fill/enhance a product or service void in their offerings or as a platform acquisition,” said Evan Klein, Managing Director at Berkery Noyes. “This robust level of activity is a result of the significant amounts of cash held by operating companies and financial investors. Strategic acquirers are looking to enhance revenue growth and facilitate the transition of any legacy businesses through acquisition.”
A copy of the ONLINE AND MOBILE INDUSTRY M&A REPORT FOR THIRD QUARTER 2014 is available at the Berkery Noyes website.