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Dealmaking Up, But Value Down in Info Industry M&A

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October 24, 2013

According to the latest research from Berkery Noyes, an independent mid-market investment bank, the number of private equity acquisitions in the Information Industry increased 18 percent in the third quarter of this year. This reversed a downward trend in volume over the past four quarters.

 

However, there was a 52 percent decline in overall value between second and third quarter 2013, from USD 20.0 billion to USD 9.7 billion. The peak for financially sponsored deal value during the last 21 months occurred in second quarter 2013, which was attributable in part to the acquisition of BMC Software by a private investor group – led by Bain Capital and Golden Gate Capital – for USD 6.8 billion.

 

The largest transaction in Q3 2013 was Thoma Bravo’s acquisition of Intuit Financial Services for USD 1.0 billion. Thoma Bravo had nine Information Industry transactions year-to-date, four of which occurred in Q3 2013.

 

The number of deals between private equity firms rebounded sharply in third quarter 2013. After falling 50 percent between first and second quarter 2013, secondary buyout volume improved almost fourfold over the past three months. Secondary buyouts as a percentage of the industry’s aggregate volume also saw an uptick of six percent thus far in 2013 relative to the corresponding timeframe in 2012.

 

Meanwhile, private equity firms as sellers represented 45 percent of transaction volume during the quarter, an increase of 10 percent when compared to the industry’s historical average since 2012. (Image source: BN)

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