NEW YORK — January 22, 2016 — Berkery Noyes, an independent mid-market investment bank, today released its full year 2015 mergers and acquisitions trend report for Private Equity in the Information Industry.

The report analyzes M&A activity in the private equity market during 2015 and compares it with data covering 2013 and 2014. It features transactions made by financially sponsored acquirers within the Information Industry, including purchases made by subsidiaries or platforms of private equity firms.

According to Berkery Noyes’ latest research, private equity deal volume in the Information Industry increased 12 percent on a year-to-year basis. Total transaction value gained 23 percent, from $52.79 billion to $64.90 billion. Of note, seven of the top ten highest value deals in 2015 occurred during the second half of the year. Regarding valuations, the median revenue multiple improved from 1.9x to 2.3x, while the median EBITDA multiple rose from 12.4x in to 15.2x. These were the highest median multiples recorded in the industry over the past three years.

The Information Industry’s horizontal Software market saw a seven percent rise in private equity deal activity. Moreover, three of the industry’s top five largest transactions during 2015 occurred in the Infrastructure Software segment. As for secondary buyouts, or transactions completed between private equity firms, deal volume remained about constant. However, this represented a 40 percent increase relative to 2013. The largest secondary buyout in the Infrastructure segment was Bain Capital’s acquisition of Blue Coat Systems, a provider of enterprise security solutions, from Thoma Bravo for $2.4 billion.

In terms of specific vertical markets, the Finance vertical had a 12 percent increase in private equity volume. The most active acquirer in the Finance sector in 2015, either directly or through an affiliated business, was Vista Equity Partners with six transactions. The largest of these deals was the announced acquisition of Solera Holdings in the property and casualty (P&C) sector for $6.25 billion.

Other related deals completed by Vista Equity included International Document Services, a provider of mortgage documents and compliance services; Coretrac, which offers integrated customer relationship management (CRM) solutions to banks and credit unions; Eagleview Technology Corporation, an aerial imagery, data analytics and GIS solutions business serving the commercial, government and public utility sectors, a deal that occurred in the Insurance segment; AutoStar Solutions, which provides management application software to automobile dealerships, as well as independent finance companies; and Cougar Software, an investment management solutions company used by real estate investors.

The Education vertical experienced a 13 percent improvement in financially sponsored volume. Upon examination of specific buyers, the most active acquirer in the Education sector in 2015, either directly or through an affiliated business, was Providence Equity Partners with eight transactions.

Along these lines Providence acquired Blue Canary, a higher-ed predictive analytics company; Nivel Siete, a provider of a variety of learning solutions, hosting, support, and consulting services; Aerobics and Fitness Association of America, which offers education workshops and certifications; Studialis, a group of 23 higher-ed institutions; X-Ray Analytics, a predictive analytics tool that will be integrated with Blackboard’s Moodlerooms and Enterprise Moodle; Remote-Learner UK, which provides hosting, support, and other open source solutions to the education industry; Endeavour College of Natural Health, an Australian-based institution that offers vocational training in the health and wellness sector; and Schoolwires, an educational website, hosting, and content management provider to K-12 schools.

Meanwhile, The Riverside Company was the most active financial sponsor in the Professional Training and Services subsector with three acquisitions. Riverside, either directly or through an affiliated business, acquired Health and Safety Institute, a training and compliance company; C-Learning, which specializes in online content development, learning management, and other e-learning solutions; and Digital Ignite, SaaS-based continuing education and learning management software company.

The Healthcare vertical underwent a five percent yearly decline in private equity volume. This followed a 26 percent increase between 2013 and 2014. The most active financial sponsor in the Healthcare sector in 2015, either directly or through an affiliated business, was New Mountain Capital with five transactions. Of these deals, the largest was the acquisition of Equian, a provider of health care payment integrity solutions to payors of medical claims, for $225 million.

“Private equity acquirers are continuing to place premium valuations on quality information companies,” said James Berkery, Chief Information Officer at Berkery Noyes. “This renewed interest is supporting higher multiples for the most attractive properties. Drawn by stronger valuations, once reticent sellers are showing increasing receptivity to good offers, which points to more opportunity ahead.”

A copy of the PRIVATE EQUITY IN THE INFORMATION INDUSTRY M&A REPORT FOR FULL YEAR 2015 is available at the Berkery Noyes website.