November 18, 2013 THIRD QUARTER 2013 PROVES STRONG FOR M&A IN THE FINANCIAL TECHNOLOGY INDUSTRY

Berkery Noyes has issued its Financial Technology report for third quarter 2013. Deal volume in the quarter reached its highest point throughout the past year-and-a-half, with a total of 93 transactions. Aggregate value was tied with its second highest level during this period, at $8.5 billion. The median revenue multiple from 2012 through the first three quarters of 2013 declined from 2.9x to 2.5x, while the median EBITDA multiple moved slightly from 11.6x to 12.0x.

Six of the report’s top ten largest deals year-to-date occurred within the Banking segment. Three of these six transactions occurred in third quarter 2013.

Deal volume in the Insurance segment year-to-date increased 13 percent when compared to the corresponding timeframe in 2012. One notable transaction in the segment during third quarter 2013 was LexisNexis’ acquisition of Mapflow, which provides geographic risk assessment technology and underwriting solutions.

“There are a lot of changes occurring in the Insurance sector,” stated Peter Ognibene, Managing Director at Berkery Noyes. “For one thing, technologies such as data visualization solutions are providing more insight into existing datasets. Moreover, the ability to interpret unstructured data from multiple external sources can improve the ability to collect information and thus market to new clients. Insurers are continuing to look for better ways to leverage their analytical capabilities, and the positive impact this is having on acquisition activity has become evident.”

As for the Payments segment, M&A volume experienced a 142 percent increase in the quarter, with a total of 29 deals. This came in the aftermath of a 50 percent decrease between first and second quarter 2013. Regarding strategic acquirers, the segment’s highest value transaction in third quarter 2013 was EBay’s acquisition of Braintree Payment Solutions for $800 million.

EBay is planning to integrate Braintree’s online and mobile payment processing platform with its PayPal division, in an effort to continue growing PayPal’s mobile business.