NEW YORK — July 13, 2017 — Berkery Noyes, an independent mid-market investment bank, today released its half year 2017 mergers and acquisitions trend report for the Information Industry.

The Information report features companies in the Media & Marketing, Software, and Online & Mobile Industries. It analyzes M&A activity during the first half of 2017 and compares it with the four previous six-month periods from 2015 to 2016.

Total transaction volume increased eight percent over the past six months, with a total of 2,317 deals in first half 2017. Aggregate value fell 51 percent, from $277.65 billion to $135.75 billion. However, value declined 14 percent relative to first half 2016. The peak for volume throughout the past two-and-a-half years occurred in second half 2015, whereas value reached its zenith in second half 2016. In terms of valuations, the median revenue and median EBITDA multiple stayed about the same at 1.9x and 11.0x, respectively.

Regarding the three horizontal markets covered in the report, the number of transactions in the Software horizontal improved 12 percent on a quarterly basis. Acquisition activity in the Infrastructure segment gained 21 percent, making it the sector with the horizontal’s largest increase in first half 2017.

Deal volume in the Business Software segment, which consists of software designed for general business practices and not specific industry markets, saw a 13 percent rise relative to second half 2016. Notable strategic deals in the Business segment year-to-date included Atlassian’s acquisition of Trello, a web-based collaboration software and project management service, for $425 million; Wolters Kluwer Tax & Accounting’s announced acquisition of Tagetik, which provides corporate performance management solutions and services to mid and large sized corporations, for $317 million; and Saba Software’s announced acquisition of Halogen Software, a cloud-based talent management solutions business, for $169 million.

Upon examination of high profile acquirers in first half 2017, Microsoft was active with the acquisitions of Hexadite, a cyber-security company that uses artificial intelligence software to investigate online threats and provide automated responses, for a reported $100 million; Open Build Service, an integrated development environment that will become an extension of Visual Studio; Intentional Software, which develops tools that simplify the programming and automation of tasks in a collaborative work environment; Deis, an open-source platform as a service (PaaS) that enables users to deploy and manage applications on their own servers; Agile Extensions’ Wiki extension for Visual Studio Team Services; Simplygon, a developer of automatic 3D data-optimization solutions; and Maluuba, a deep learning startup.

In the Online & Mobile horizontal market, volume improved five percent. Deal activity in the SaaS & Cloud segment rose four percent. SaaS & Cloud acquisitions in first half 2017 received a median revenue multiple of 2.4x, compared to 1.8x for the entire Online & Mobile market.

M&A volume in the mobile application subsector decreased two percent during the half year period. One notable acquirer was Snap Inc. (which went public earlier this year and has rebranded itself as a camera company) with the acquisitions of Zenly, a social mapping startup, with a reported purchase price of $200 million; and Placed, a consumer location analytics platform that helps measure the offline impact of mobile ads and insights into consumer behavior, with a reported purchase price of $125 million.

As for specific Online & Mobile sectors, there continues to be active interest in online recruitment and jobs sites. One high profile deal in first half 2017 was Apollo Group Management’s acquisition of Career Builder, a job board and talent acquisition solutions company, for $475 million. This followed several major acquisitions in this space during 2016, for instance Microsoft’s acquisition of LinkedIn for $25.89 billion and Randstad Holding’s acquisition of Monster Worldwide for $429 million.

Deal flow in the Media and Marketing horizontal moved upward three percent during the half year period. Meanwhile, the number of acquisitions in the B2B Publishing and Information segment increased 21 percent. High profile B2B related transactions over the past six months included Gartner’s announced acquisition of CEB Global, a corporate research and advisory firm, for $3.3 billon; Moody’s Analytics’ announced acquisition of Bureau van Dijk Electronic Publishing, a provider of business intelligence and company information, for $3.27 billon; and Zurich-based family office TBG’s acquisition of DTN, which distributes real-time weather information to farmers and other customers, for $900 million.

“Given the favorable economic climate, large strategics in general are finding it easier to strengthen their balance sheets, improve earnings, and generate cash to invest in core business activities,” said James Berkery, Managing Partner at Berkery Noyes. “Some strategic players will use the cash to retire their debt. However, a good cash position and strong stock prices will make others more likely to seek acquisitions that can provide new customers, new technologies or access to new markets, and these often entail niche businesses that bolt on or tuck into existing operations.”

A copy of the INFORMATION INDUSTRY M&A REPORT FOR HALF YEAR 2017 is available at the Berkery Noyes website.