Sectorwatch: LATAM - IT Services

7 Mile Advisors

Sectorwatch: LATAM - IT Services June 2021

Sector Watch:Latin America - IT Services

7 Mile Advisors appreciates the opportunity to present this confidential information to the Company. This document is meant to be delivered only inconjunction with a verbal presentation, and is not authorized for distribution. Please see the Confidentiality Notice & Disclaimer at the end of the document.All data cited in this document was believed to be accurate at the time of authorship and came from publicly available sources. Neither 7 Mile Advisors nor7M Securities make warranties or representations as to the accuracy or completeness of third-party data contained herein. This document should be treatedas confidential and for the use of the intended recipient only. Please notify 7 Mile Advisors if it was distributed in error.

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Sector Dashboard

Public Basket Overview

Public Basket Performance

Operational Metrics

Valuation Comparison

Recent Deals

Appendix

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Overview

7MA provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally.

DASHBOARD

PUBLIC BASKET PERFORMANCE

VALUATION COMPARISON

RECENT DEALS

• Summary metrics on the sector.• Commentary on market momentum by comparing the

most recent 12-month performance against the last 3-year averages.

• Summary valuation and operating metrics for a basket of comparable public companies.

• Graphical, detailed comparison of valuation multiples for the public basket.

• The most recently announced deals in the sectors.

We advise on M&A and private capital transactions and provide market assessments and benchmarking. As a close-knit team with a long history together and a laser focus on our target markets, we help our clients sell their companies, raise capital, grow through acquisitions, and evaluate new markets.

We publish our sectorwatch, a review of M&A and operational trends in the industries we focus.

1 - year revenue growth compared to revenue growth average for last 3 years - Current revenue growth rate exceeds the average of the last 3 years by this amount, indicating that market momentum is increasing

3.2%

6.0x

22.6x

38.5x

54.5x

0x 5x 10x 15x 20x 25x 30x 35x 40x 45x 50x 55x 60x

Median TEV / LTM Revenue

Median TEV / LTM EBITDA

Median TEV / LTM EBIT

Median Price / LTM Earnings

12.3%

16.7%

35.6%

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Median LTM Rev. Growth %

Median LTM EBITDA Margin %

Median LTM GP Margin %

Dashboard

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Operating Metrics

Valuation

REVENUE GROWTH MOMENTUM

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2011 2013 2015 2017 2019 2021*

M&A Activity

Deal Count*Deal count for 2021 is as of June 28th and is not a full-year statistic.

Sonda 693 121 994 -11.4% 17.4% 12.1% 0.7x 5.7x 13,387 74

Indra Sistemas 2,220 302 3,565 -4.5% 37.6% 8.5% 0.6x 7.4x 48,979 73

Totvs 4,198 502 17.0% 70.5% 8.4x 10,000 50

Endava 6,886 98 526 19.6% 33.6% 18.6% 13.1x 70.2x 7,139 74

Globant 9,331 203 893 26.7% 37.6% 22.7% 10.5x 46.0x 17,267 52

Accenture 180,358 8,007 47,949 7.6% 32.0% 16.7% 3.8x 22.5x 569,000 84

Company TEV $mLTM

EBITDA $mLTM Rev

$m

Rev Growth

YoYGP % EBITDA % TEV / Rev X

TEV / EBITDA X

# FTEsRev / FTE

$k

Public Basket

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Average 33,948 1,746 9,071 9.2% 38.1% 15.7% 6.2x 30.4x 110,962 68

Median 5,542 203 943 12.3% 35.6% 16.7% 6.1x 22.5x 15,327 73

share price as of 28Jun21

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TEV/EBITDA (Adjusted) - Median

TEV/EBITDA (Adjusted) - Average17.3x

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TEV/EBITDA (Adjusted) - Median TEV/Revenue - Median

TEV/EBITDA (Adjusted) - Average TEV/Revenue - Average

Public BasketPublic EBITDA Multiples over Time

Public Revenue Multiples over Time

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- 5% 10% 15% 20% 25%

Median

Indra Sistemas

Sonda

Accenture

Endava

Globant

- 20% 40% 60% 80%

Median

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Accenture

Endava

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Totvs

Operational Metrics

LTM Gross Profit Margin % LTM EBITDA %

7*Totvs EBITDA data is not available.

Operational Metrics

LTM Revenue Growth %LTM Revenue per

Full Time Employee x 000’s

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(20%) (10%) - 10% 20% 30%

Median

Sonda

Indra Sistemas

Accenture

Totvs

Endava

Globant

$- $20 $40 $60 $80 $100

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Globant

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Accenture

Operational MetricsAccounts Receivable

TurnoverAverage Days

Sales Outstanding

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*Indra Sistemas AR turnover data is not available. *Indra Sistemas average days sales outstanding data is not available.

Valuation

TEV / LTM Revenue TEV / LTM EBITDA

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Median

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Accenture

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*Totvs EBITDA data is not available.

Valuation

TEV / LTM EBIT Price / LTM Earnings

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Median

Indra Sistemas

Sonda

Accenture

Totvs

Globant

Endava

6x 7x 23x 45x 70x #N/A

(11.4%)

(4.5%)

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Historical Valuation Multiples versus Gross Profit

Historical Valuation Multiples versus Revenue Growth Rate

Valuation

12*Totvs EBITDA data is not available. *Totvs EBITDA data is not available.

Date Target Buyer / InvestorTotal

Transaction Value

Target Revenue

TEV / Revenue

TEV / EBITDA

15-Jun-21 Werise (Brazil) Delta-v Capital - - - -

14-Jun-21 Pixan Apps Zigatta - - - -

02-Jun-21 Redpagos Prosegur Compañia de Seguridad - - - -

31-May-21 Energy Computer Systems Grupo Amper 0.97 - - -

28-May-21 NotCo Union Square Hospitality Group 10.00 - - -

24-May-21 Valor Inmueble Cinven - - - -

12-May-21 OmniLatam 777 Partners 11.30 - - -

09-May-21 Nubila Nybl - - - -

03-May-21Acepta (Chile) HG Capital (UK) - - - -

30-Apr-21 DTI Digital WPP - - - -

14-Apr-21 Adweb Solutions Mexico Zigatta - - - -

07-Apr-21 BoosterAgro Agrosmart - - - -

Recent Market Transactions

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Sector Watch:Latin America - IT Services - April 2021

AppendixPublic BasketContact Information

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Public Basket

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Sonda SA provides information technology solutions and services.

The firm has IT Services, Applications, and Platform segments. The company provides its products and services to banking, education, governance, health, manufacturing, mining, retail, transportation and utility industries. It operates mainly in Argentina, Brazil, Chile, Columbia, Costa Rica, Ecuador, Mexico, Panama, Peru, and Uruguay.

Sonda

Sonda

Public Basket

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Revenue Multiples - Sonda

TEV/Revenue Average

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EBITDA Multiples - Sonda

TEV/EBITDA (Adjusted) Average

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P/E Multiples - Sonda

P/E (Adjusted) Average

Sonda

Company Name Date Deal Synopsis

M2M Solutions 22-Jan-19 The company was acquired by Sonda (SGO: SONDA) for approximately BRL 13 million on January 22, 2019.

Ativas Data Center 10-Aug-16Cia Energética de Minas Gerais (BSP: CMIG3) was in talks to sell its 49% stake in the company to an undisclosed investor as of August 10, 2016. Subsequently the deal was cancelled.

Public Basket

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Totvs SA is a Brazil-based provider of information technology solutions to small and medium enterprises in the education, government, healthcare, and retail end markets.

Its primary product offerings are enterprise resource planning applications with modules for management, finance, operations, human resources, and client services. Other solutions include integrated management software, collaboration, and productivity platforms, and consulting services. The firm has operations in Brazil, Argentina, Chile, Colombia, Ecuador, Mexico, Paraguay, Peru, and Uruguay.

Totvs

Totvs

Public Basket

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Totvs


RD Station 10-Mar-21The company was acquired by Totvs (BSP: TOTS3) for BRL 1.8 billion on March 10, 2021. The acquisition will help the company to enhance the acquirer's business-to-business offer with it's SaaS digital marketing solution.

Tail Target (São Paulo) 19-Dec-20The company was acquired by Totvs (BSP: TOTS3) for BRL 32 million on December 19, 2020. The company will receive a contingent payout of BRL 20 million upon the completion of goals to be reached in 2021 and 2022, in addition to other conditions.

Public Basket

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Indra Sistemas is a Spain-based provider of information technology offerings for finance, insurance, public administration, airports, defense, healthcare, media, telecom, security, energy, and infrastructure end markets.

Its product capabilities include analytics, cloud computing, enterprise resource planning, networks and communications, electoral processes, bus technology, subway technology, and sustainability solutions. The firm generates revenue in Europe, Africa, the Middle East, the Americas, and Asia-Pacific.

Indra Sistemas

Indra Sistemas

Public Basket

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SmartPaper 12-Jan-21The company was acquired by Indra Sistemas (XMAD: IDR) for an undisclosed amount on January 12, 2021. The acquisition reinforces the Minsait's presence in the Italian 'Business Process Outsourcing' (BPO) market.

Sistemas Informaticos Abiertos 31-Dec-19 The company was acquired by Indra Sistemas (XMAD: IDR) for EUR 72.896 million on December 31, 2019.

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Endava PLC provides technology solutions.

It offers various services such as Agile Transformation, through which the company identify, define, and implement the mix of process, technology, and culture. It also provides Digital Evolution and Automation, Test Automation and Engineering, Cloud, Architecture, Software Engineering, and others. The company offers its services to various industries such as Finance, Retail and Consumer Goods, Telecommunication, Media, and Technology, Insurance and Healthcare, and others.

Endava

Endava

Public Basket

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Levvel 01-Apr-21 The company was acquired by Endava (NYS: DAVA), a subsidiary of Concise, for an undisclosed amount on April 1, 2021.

Five (Croatia) 04-Mar-21The company, a subsidiary of RealNetworks (NAS: RNWK) was acquired b y Endava (NYS: DAVA), a subsidiary of Concise, for an undisclosed amount on March 4, 2021. With this acquisition, Endava increases its capacity in the ideation, design and delivery of intelligent digital experiences and enhances its capabilities in digital product strategy and performance optimization services.

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Public Basket

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Globant SA is a software technology developer based in Luxemburg.

It creates platforms which are powered by native digital technology, better known as digital journeys. The digital journey incorporates various software products, mobile apps and sensors that assist its clients in knowing its end user's behavioral pattern. The key aspects of the digital journey are stay relevant, discover and build. The stay relevant helps its clients in staying abreast of the developments in its industry and taking preemptive measures. The discover conceives digital journeys for the users based on consumer behaviors and technologies and the build creates each digital journey leveraging the work of its studios. The company's revenue is primarily generated by its technology services in the United States.

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Globant

Public Basket

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HABITANT (Spain) 12-May-21The company was acquired by Globant (NYS: GLOB) for an undisclosed amount on May 12, 2021. With this acquisition, Globant reinforces its expansion plans in Europe.

Digital House 25-Mar-21The company raised $50 million of venture funding from MercadoLibre, Globant, and Riverwood Capital on March 25, 2021. Kaszek also participated in the round. The funds will be used to evolve the company's digital training platform, in addition to launching a two-year technology training program and expand its alliances with employers and technology companies in Brazil and the rest of Latin America.

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Public Basket

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Accenture is a leading global IT-services firm that provides consulting, strategy, and technology and operational services.

These services run the gamut from aiding enterprises with digital transformation to procurement services to software system integration. The company provides its IT offerings to a variety of sectors, including communications, media and technology, financial services, health and public services, consumer products, and resources. Accenture employs just under 500,000 people throughout 200 cities in 51 countries.

Accenture

Accenture

Public Basket

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Sentor 29-Jun-21The company was acquired by Accenture (NYS: ACN) for an undisclosed amount on June 29, 2021. The acquisition will further extend Accenture's local resources and capabilities and addressing the growing demand for local cybersecurity and managed security services.

Exton Consulting 18-Jun-21

The company reached a definitive agreement to be acquired by Accenture (NYS: ACN) for an undisclosed amount on June 18, 2021. The acquisition will enhance Accenture's ability to leverage the combination of group of people with the latest technologies such as artificial intelligence, data and cloud, to help clients embrace change, accelerate transformation, unlock value and build new sustainable models that benefit all.

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Leroy Davis, Partner 704.899.5962 [email protected]

Tripp Davis, Partner 704.899.5762 [email protected]

Andy Johnston, Partner 704.899.5961 [email protected]

John Cooper, Managing Director 704.973.3996 [email protected]

Mark Landry, Managing Director 561.972.0609 [email protected]

Horacio Yenaropulos, Managing Director + 54.261.4617300 [email protected]

Tim Frye, Senior Director 704.973.3994 [email protected]

Kristina Sergueeva, Director 704.899.5149 [email protected]

Ben Garber, Vice President 412.626.7898 [email protected]

Garth Martin, Vice President 704.973.3997 [email protected]

Nicholas Prendergast, Vice President 704.973.3995 [email protected]

Ariail Barker, Director, Sales & Marketing 704.981.2908 [email protected]

Ben Bruggeworth, VP, Business Development 704.365.8859 [email protected]

Steve Sypek, VP, Business Development 704.414.8736 [email protected]

Emily Halstenberg, Marketing & Sales Manager 704.409.9912 [email protected]

Alexis Papa, Marketing & Sales Coordinator 704.414.8732 [email protected]

Marty Johnson, Senior Associate 704.973.3999 [email protected]

Sydney Scadden, Senior Associate 704.973.3998 [email protected]

Steve Buffington, Associate 704.960.1828 [email protected]

Ilia Ulianchuk, Senior Analyst 704.414.8743 [email protected]

Nic Anderle, Analyst 704.826.7492 [email protected]

Sawyer Willingham, Analyst 704.285.8171 [email protected]

Robin Siegel, Analyst 704.285.8173 [email protected]

Conor Smith, Analyst 704.855.2134 [email protected]

Kevin Postigo, Analyst 704.912.4903 [email protected]

Tanner Lange, Analyst 704.672.0611 [email protected]

Contact Info

7MA provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally. We advise on M&A and private capital transactions and provide market assessments and benchmarking.

As a close-knit team with a long history together and a laser focus on our target markets, we help our clients sell their companies, raise capital, grow through acquisitions, and evaluate new markets. Securities offered through 7M Securities LLC.

Sectorwatch: LATAM - IT Services

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