Berkery Noyes Releases Software Industry M&A Report for Full Year 2012

    Berkery Noyes Releases Software Industry M&A Report for Full Year 2012

PR Newswire

NEW YORK, Jan. 3, 2013

NEW YORK, Jan. 3, 2013 /PRNewswire/ --Berkery Noyes, an independent
mid-market investment bank, today released its full year 2012 mergers and
acquisitions trend report for the Software Industry. The report analyzes M&A
activity in the Software Industry during 2012 and compares it with data
covering 2010 and 2011.

According to Berkery Noyes' latest research, deal volume increased one percent
from 1,513 transactions in 2011 to 1,529 transactions in 2012. At the same
time, transaction value fell from $80.78 billion to $66.60 billion, a decline
largely attributed to the lack of deals above $5 billion in 2012.

The median revenue multiple moved slightly from 2.2x to 2.1x, while the median
EBITDA multiple declined from 12.9x to 11.9x. Regarding financially sponsored
transactions within the Software Industry, there was a 19 percent rise in deal
flow compared to 2011 and a 38 percent improvement relative to 2010. This
included a 50 percent increase for private equity acquisitions in the
Healthcare vertical for 2012.

The Niche Software segment, which is characterized as software that is
designed to be used in specific vertical industries, experienced a nine
percent increase in transaction volume in 2012. This was in contrast to the
segment's 18 percent rise from 2010 to 2011. Meanwhile, there was a 35 percent
M&A uptick in the last twelve months involving companies that serve the
retailer portion of the Software Industry. One of the largest corresponding
transactions was NCR Corporation's announced acquisition of Retalix for $650
million. In addition, deals in the retailer market with a
Software-as-a-Service (SaaS) component increased 16 percent in 2012. Another
growth area in the report involved the supply chain and fleet management
subsector. Deal volume in this subsector rose 72 percent over the past year.

Transaction volume in the Consumer Software segment increased seven percent
from 2011 to 2012. The segment was impacted positively by both photography and
social video software acquisitions, as M&A in the combined subsector improved
fivefold  on a year-to-year basis. In terms of notable facial recognition
software transactions, Facebook acquired for $60 million and Google,
through its subsidiary Motorola, acquired Viewdle for $45 million.

Volume in the Business Software segment was down 10 percent compared to the
previous year and 16 percent relative to 2010. However, the segment's value of
$14.37 billion was on par with its 2010 level. This was largely attributable
to SAP America's acquisition of Ariba for $4.40 billion in 2012, which was the
segment's highest value transaction during the three years covered in the
report. The most active acquirer in the Business Software segment in 2012 was
Oracle with seven transactions.

The Infrastructure segment, after undergoing an 18 percent rise in transaction
volume from 2010 to 2011, decreased 12 percent in 2012. Nonetheless, related
acquisitions in the software-defined networking (SDN) subsector were made by
some of the industry's most notable companies. For example, Cisco Systems
announced its acquisition of Cloupia, a software company offering IT solutions
such as data center convergence, for $125 million in the fourth quarter.
VMWare's announced acquisition of Nicira for $1.1 billion in the third quarter
– which Berkery Noyes' mentioned in its previous report – was the highest
value SDN transaction in 2012.

"Software-defined data centers, by facilitating a converged infrastructure,
allow services in the cloud to be delivered more efficiently," said James
Berkery, Chief Information Officer at Berkery Noyes. "As virtualization and
the cloud continue to evolve, product innovation in the Infrastructure segment
is likely to have a significant impact upon acquisition activity in the
Software Industry."

A copy of the SOFTWARE INDUSTRY M&A REPORT FOR FULL YEAR 2012 is available at
the Berkery Noyes website.

Berkery Noyes specializes in mergers and acquisitions advisory, debt and
equity financing, and financial consulting services for companies in the $10
million to $500 million range, a market that is enjoying a surge in activity.
The firm's research teams publish acquisition activity in the respective
sectors they follow on

About Berkery Noyes

Berkery Noyes is an independent investment banking advisory firm servicing the
information industry. Focused on middle-market corporations and financial
sponsors, Berkery Noyes is committed to delivering a comprehensive array of
industry-leading advisory services. Since its founding by Joseph W. Berkery in
1983, the firm has worked with corporate clients to grow through acquisition,
divest non-core assets, and maximize shareholder returns through strategic
transactions and restructurings. For private owners, Berkery Noyes helps
create liquidity and execute timely exit strategies that achieve their
personal and professional objectives. Securities services are offered through
Berkery Noyes Securities, LLC. For more information, visit

Contact Information:
Peter Wilson
Berkery Noyes

SOURCE Berkery Noyes

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