2017 Key Highlights

  • The Infrastructure segment’s largest transaction in 2017 was Thales SA’s announced merger with Gemalto, a digital security company that offers mobile connectivity, payment technology, and data protection solutions, for $6.51 billion.
  • Cisco Systems was responsible for two of the industry’s top ten largest acquisitions in 2017: AppDynamics, an application performance management and IT analytics company, for $3.9 billion; and Broadsoft, which offers software and services that enable telecommunications service providers to deliver hosted cloud-based unified communications to enterprise customers, for $1.87 billion.
  • There were 487 financially sponsored transactions with an aggregate value of $56.13 billion, representing 22 percent of the total volume and 42 percent of the total value, respectively.

2017 Key Trends

  • Total transaction volume in 2017 increased by four percent over 2016, from 2,100 to 2,191.
  • Strategic volume in 2017 remained about constant over 2016, at 1,704. Private equity backed volume improved 22 percent during this timeframe, from 399 to 487.
  • Total transaction value in 2017 declined by 16 percent over 2016, from $159.32 billion to $133.64 billion.
  • The median revenue multiple decreased from 2.7x in 2016 to 2.3x in 2017. The median EBITDA multiple saw a slight uptick from 12.7x in 2016 to 13.3x in 2017.

M&A Market Overview

Berkery Noyes tracked 6,360 Software transactions between 2015 and 2017, of which 1,385 disclosed financial terms, and calculated the aggregate value to be $391.92 billion. Based on known transaction values, we project values of 4,975 undisclosed transactions to be $114.90 billion, totaling $506.81 billion worth of transactions tracked over the past three years.

Disclosed median enterprise value multiples for all segments combined in this report during the last 36 months were 2.5x revenue and 13.2x EBITDA.