Software transaction volume saw a two percent uptick over the past three months, from 588 to 599. After rising 56 percent in Q4 2018, aggregate value fell 48 percent, from $88 billion to $45.5 billion. Deal activity improved 18 percent and value gained 33 percent when examined on a year-over-year basis.
The Infrastructure segment underwent a 22 percent increase in volume from Q4 2018 to Q1 2019. The largest security related transaction year-to-date was Carbonite’s acquisition of Webroot, which secures endpoints and provides network protection, security awareness training, and threat intelligence services, for $619 million.
Deal volume in the “Niche Software” segment, which is targeted to specific vertical markets, experienced a three percent quarterly gain and rose 11 percent over Q1 2018. The Niche segment’s largest transaction in Q1 2019 was Thoma Bravo’s announced acquisition of Ellie Mae, a cloud-based platform provider for the residential mortgage sector, for $3.3 billion.
M&A volume in the Business segment, which consists of software designed for general business practices and not specific industry markets, remained about constant on a quarterly basis. However, activity improved 15 percent compared to Q3 2018 and 45 percent relative to Q1 2018.
Two of the industry’s top ten largest deals year-to-date occurred in the Business segment’s human capital management (HCM) sector: the announced acquisition of Ultimate Software Group, a provider of cloud-based HCM solutions, by an investor group led by Hellman & Friedman, for $10.8 billion; and Morgan Stanley’s announced acquisition of Solium Capital, a provider of SaaS-based stock plan administration technology and services, for $744 million.