WEBINAR: Is Your Company’s Buyer In Asia?

Thursday,

April 28, 2016

10am PDT

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About Corum Group

About Corum •  Completed over $7 billion in software M&A Transactions over the last 30

years, spanning six continents

•  Dealmakers are highly experienced former CEOs who are supported by a

team of top M&A researchers, analysts, writers and valuators.

•  Focused: only sell-side, only privately held technology companies

•  Largest tech M&A educator in the industry – 200 events per year

•  Comprehensive buyer & transaction database – largest in the industry

•  Global operations – 60% of deals cross borders

To learn more visit

www.corumgroup.com

CorumGroupisthegloballeaderinmergerandacquisi<onservices,specializinginservingsellersofso?wareandinforma<ontechnologycompaniesworldwide.

Presenter

JIM PERKINS •  Senior Vice President at

Corum Group

•  28 years of experience as an entertainment software entrepreneur

•  Educates and helps

prospective sellers maximize their digital media companies

Jim Perkins

April 2016

Is Your Company’s Buyer in Asia?

North America 2014 2015 % Change

Sellers 2302 2509 9%

Buyers 2632 2735 4%

Europe 2014 2015 % Change

Sellers 922 1130 23%

Buyers 796 961 21%

Latin America 2014 2015 % Change

Sellers 45 56 24%

Buyers 10 21 110%

Mideast/Africa 2014 2015 % Change

Sellers 45 77 71%

Buyers 25 42 68%

Asia 2014 2015 % Change

Sellers 348 487 40%

Buyers 319 493 55%

Source:451Research

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TopTechnologyBuyers2014-16inAsiaByAggregateValuein$Billions

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TopTechnologyBuyersofNon-AsianTargets2014-16inAsiaByAggregateValuein$Billions

1113

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30

11

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Upto$10M $10-$25M $25-$100M $100-$500M $500M-$1B >$1B

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fOccurrences

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Technology M&A Valuations 2014-2016 Asian Buyers, All Targets

Deals by Transaction Size Segregated by Year

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Upto$10M $10-$25M $25-$100M $100-$500M $500M-$1B >$1B

DealsbyTransacJonSizeSegregatedbyYear

2014 2015 Projected2016

Target: Youku Tudou [China] Acquirer: Alibaba Group [China] Transaction Value: $3.7B (4.6x Revenue)

Megadeal Spotlight

Soldto

-  YouKuistheChineseversionofYouTube,hosJngonlinevideocontent-  AlibabapurchasedYouKutoforitsbrandrecogniJon,toconsolidate

internettraffic,andgenerateadverJsingrevenue

Megadeal Spotlight

Soldto

Target:LexmarkInternaJonalInc.[USA]Acquirer:ApexTechnologyCo.Ltd.[China]TransacBonValue:$2.5B(1xRevenue)

-  ChinesePrinJngFirmApexpurchasedLexmarkaspartofaconsorJum

-  Whilemodernizing,LexmarkaddedamobiledivisiontoitsprinJngbase

-  ChinaisdominatedbytheMobilemarket

Soldto

Target:Tencent[China]Acquirer:Miniclip[France]TransacBonValue:Undisclosed -  EuropeanFlashandmobilegamepublisherwith70millionstrongaudience

-  ExpandspresenceinEuropeanmarket

-  TencentisoneofChina’slargestandmostusedInternetServicePortals

International Deal Spotlight

International Deal Spotlight

Target: SHL Telemedicine [Israel] Acquirer: Shanghai Jiuchuan [China] Transaction value: $118.5M (17.3x EBITDA) - Provides personal telemedicine & EHR systems.

- Buyer a diversified holding company that owns hospitals and provides health IT services across China

上海九川 Shanghai Jiuchuan

Soldto

International Deal Spotlight

Target:DigitalExtremes[Canada]Acquirer:PerfectWorld&LeyouTechnologyHoldings[HongKong]TransacBonvalue:$73.2M($120MEV)‒ Developer of popular free-to-play action game ‘Warframe’

‒ Majority stake sold to Leyou Holdings, currently entering video

game market ‒ Online games developer Perfect World took 3%-stake

Soldto

How to Reach & Leverage Asian Buyers

•  Track Industry M&A and other Tech Trends in Asia

•  Network through LinkedIn and other tools – Asia centric

Contacts

•  Attend Industry Specific trade shows/events in Asia

•  Work with Professionals/Advisors that have completed deals

in Asia, including Lawyers, Accountants, M&A experts

Mobile Dominance in China

•  1.3 billion mobile subscriptions

•  More social media users than Europe and US combined

•  Roughly 100,000 in China start using the internet every day over the past year

•  China’s mobile gaming industry grossed $7.8 billion in 2015

Source: wearesocial.com, China Daily, Mobile Ecosystem Forum

•  94.5% of China’s population uses a mobile phone

•  30% with 4G connectivity •  90% of Chinese Internet

users connect using mobile devices

•  $51B in mobile app revenue predicted in 2016 – largest mobile app market by revenue and downloads

Chinese Public Market Volatility

Exchange Rate Volatility

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0.145

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0.165

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CNY/USD

CNY/USD

Public Company Multiples Comparison

42x

22x

Examples

PE

AsianGamingCompanies

AmericanGamingCompanies

PE

Deal Structures

• Cash

•  Stock

•  Earn-out

• Retention

• Cultural Exchange

•  Independence

Integrating – Best Practices

MARKETING§  Vision/Strategy§  MarketplacePosiJoning§  SalesStrategy

HUMANRESOURCES§  HRConcepts,Benefits,CompensaJonPlans§  OrganizaJon§  People

RELATIONSHIPMANAGEMENT

§  Customers§  Dealers/Partners§  Suppliers

OPERATIONS§  Processes§  Systems/Procedures§  Product/Technology

The Integration Plan

•  Both sides should define a multi-disciplined task force that works together as one team

•  Hire a full-time executive officer as dedicated integration manager to guide the process

•  Have the integration team develop the plan and execute it

•  Regular reporting •  Goal: establish operating model, mitigate

risk, satisfy stakeholders

Closing Thoughts

•  Asian buyers are increasingly active

•  Deal size is increasing, but significant middle-market activity continues

•  International M&A helps Chinese buyers in particular make investments in stable markets

•  Asian buyers offer significant opportunities (market, valuation premiums) but also risks

•  Is your company’s buyer in Asia?

Contact Information

www.corumgroup.com

Corum Group Ltd. 19805 North Creek Parkway Suite 300 Bothell, WA 98011 USA +1 425-455-8281

Corum Group International S.à.r.l. Beim Paradeplatz Buechenstr. 9 8185 Winkel Switzerland +41 43 888 7590

Or email jimp@corumgroup.com

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