September 2, 2014 TRANSACTION VOLUME MAKES GAINS THROUGHOUT THE INFORMATION INDUSTRY

Berkery Noyes’ Information report for first half 2014 revealed that total transaction volume rose by four percent since second half 2013. Aggregate value increased 23 percent, from $94.80 billion to $116.92 billion. This also represented a 15 percent rise in volume and a 73 percent gain in value relative to first half 2013. Of note, the peak for volume and value throughout the past two-and-a-half years occurred in first half 2014. In terms of valuations, the median revenue and median EBITDA multiple over the past six months remained nearly constant at 2.0x and 9.3x, respectively.

Regarding the three horizontal markets covered in the report, Online and Mobile transaction volume improved seven percent. The segment with the largest rise in Online and Mobile volume was Communications with a 27 percent increase. Two of the Communications segment’s three largest deals in first half 2014 were located in the consumer mobile application subsector. This consisted of Facebook’s acquisition of WhatsApp for $16 billion and Rakuten’s acquisition of Viber for $900 million.

Deal flow in the overall Media and Marketing horizontal declined three percent. However, the Marketing segment saw volume rise seven percent.

The number of transactions in the Software horizontal improved six percent. As for the Business Software segment, M&A activity rose six percent. There was also an increase in the segment’s business intelligence subsector, from 21 to 35 transactions. Notable deals in the space in first half 2014 included TIBCO Software’s acquisition of Jaspersoft for $185 million and Dell’s acquisition of Statsoft.

“Organizations are increasingly discovering that data quality and management is at the root of many of their most important business issues,” said James Berkery, Chief Information Officer at Berkery Noyes. “Inaccurate or incomplete data promotes inefficiency, inhibits compliance, and diminishes the accuracy of analytical support and other business intelligence tools. Moreover, disparate platforms throughout large organizations pose integration challenges, further exacerbating the issue of data quality and completeness.” Berkery continued, “Companies are also grappling with the challenges and are recognizing the benefits of integrating unstructured and structured data for analysis. As a result, acquirers are showing an interest in tools that facilitate content integration, search, text analytics, portals, metadata, and master data management.”