Tech-Enabled Services Monthly November 2014 in...
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Tech-Enabled Services Monthly November 2014 in Review Tech-Enabled Services Headline Transactions TEV / Revenue TEV / EBITDA LTM Gross & EBITDA Margins 1-Year Revenue Growth 9.8x 13.0x 7.6x 8.1x 13.7x 12.8x 7.3x 0.0 2.0x 4.0x 6.0x 8.0x 10.0x 12.0x 14.0x 16.0x ITS Offshore ITS Hosting Services IT Staffing Transaction Processing Info Services VAR TEV / EBITDA 29.5% 35.4% 54.5% 19.8% 37.7% 60.5% 7.6% 10.7% 19.3% 33.9% 4.6% 22.0% 25.1% 2.9% 0% 10% 20% 30% 40% 50% 60% 70% 0% 10% 20% 30% 40% 50% 60% 70% ITS Offshore ITS Hosting Services IT Staffing Transaction Processing Info Services VAR LTM EBITDA Margin LTM Gross Margin Note: EBITDA Margins in red Target Acquirer Acquisition Synopsis ITS • • MomentumSI is a professional services firm that provides IT consulting services, including cloud consulting, migration and modernization services, as well as IaaS and PaaS services VMware acquired MomentumSI to supplement its professional services capabilities and strengthen its client roster with relationships at major companies such as eBay, Pfizer, JPMorgan Chase and Exxon ITS • • KVH provides integrated communications and IT services, including security gateway, storage and data protection, colocation and data center services and security monitoring services Colt Group announced its acquisition of KVH for $162 million to expand its capabilities in key Asian markets and bolster its cloud and data center services portfolio Man. Svs. • • TriCore Solutions is an Oracle Platinum Partner that provides enterprise managed solutions for healthcare, financial services, manufacturing, life science and retail industries worldwide BV Investment Partners announced its investment in TriCore as the third transaction in its eighth fund; BV is focused on the information and business services and communications sectors ITS • • FishNet Consulting provides information security solutions, including identity and access management, governance risk and compliance and security assessment services Accuvant, backed by Blackstone, joined forces with FishNet Security to better address the increasing risk of cyber threats through a broader set of solutions and expanded reach ITS • • Publicis Groupe (ENXTPA:PUB) entered into a definitive agreement to acquire Sapient (NASDAQ:SAPE), a US-based IT consultancy that provides loyalty strategy and analytics services, for $3.7 billion Sapient would bolster the Company’s North American operations and digital engagement capabilities 0.9x 2.7x 2.5x 0.3x 3.0x 3.4x 0.2x 0.0 0.5x 1.0x 1.5x 2.0x 2.5x 3.0x 3.5x 4.0x ITS Offshore ITS Hosting Services IT Staffing Transaction Processing Info Services VAR TEV / Revenue 18% 3.5% 15.5% 4.0% 16.8% 6.8% 7.1% 9.8% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% ITS Offshore ITS Hosting Services IT Staffing Transaction Processing Info Services VAR 1-Year Revenue Growth
Transcript of Tech-Enabled Services Monthly November 2014 in...
Tech-Enabled Services MonthlyNovember 2014 in Review
Tech-Enabled Services Headline Transactions
TEV / Revenue TEV / EBITDA
LTM Gross & EBITDA Margins1-Year Revenue Growth
9.8x
13.0x
7.6x 8.1x
13.7x 12.8x
7.3x
0.0
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
16.0x
ITS Offshore ITS HostingServices
IT Staffing TransactionProcessing
InfoServices
VAR
TEV
/ EBI
TDA
29.5% 35.4%
54.5%
19.8%
37.7%
60.5%
7.6% 10.7%
19.3%
33.9%
4.6%
22.0% 25.1%
2.9% 0%
10%
20%
30%
40%
50%
60%
70%
0%
10%
20%
30%
40%
50%
60%
70%
ITS Offshore ITS HostingServices
IT Staffing TransactionProcessing
InfoServices
VAR
LTM EB
ITDA
MarginLT
M G
ross
Mar
gin
Note: EBITDA Margins in red
Target Acquirer Acquisition Synopsis
ITS
•
•
MomentumSI is a professional services firm that provides IT consulting services, including cloud consulting, migration and modernization services, as well as IaaS and PaaS servicesVMware acquired MomentumSI to supplement its professional services capabilities and strengthen its client roster with relationships at major companies such as eBay, Pfizer, JPMorgan Chase and Exxon
ITS
•
•
KVH provides integrated communications and IT services, including security gateway, storage and data protection, colocation and data center services and security monitoring servicesColt Group announced its acquisition of KVH for $162 million to expand its capabilities in key Asian markets and bolster its cloud and data center services portfolio
Man
. Svs
. •
•
TriCore Solutions is an Oracle Platinum Partner that provides enterprise managed solutions for healthcare, financial services, manufacturing, life science and retail industries worldwideBV Investment Partners announced its investment in TriCore as the third transaction in its eighth fund; BV is focused on the information and business services and communications sectors
ITS
•
•
FishNet Consulting provides information security solutions, including identity and access management, governance risk and compliance and security assessment servicesAccuvant, backed by Blackstone, joined forces with FishNet Security to better address the increasing risk of cyber threats through a broader set of solutions and expanded reach
ITS
•
•
Publicis Groupe (ENXTPA:PUB) entered into a definitive agreement to acquire Sapient (NASDAQ:SAPE), a US-based IT consultancy that provides loyalty strategy and analytics services, for $3.7 billion Sapient would bolster the Company’s North American operations and digital engagement capabilities
1. Headline Transactions
0.9x
2.7x 2.5x
0.3x
3.0x 3.4x
0.2x
0.0
0.5x
1.0x
1.5x
2.0x
2.5x
3.0x
3.5x
4.0x
ITS Offshore ITS HostingServices
IT Staffing TransactionProcessing
InfoServices
VAR
TEV
/ Rev
enue
16.8% 18%
Services Processing Services
3.5%
15.5%
4.0%
16.8%
6.8% 7.1%
9.8%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
ITS Offshore ITS HostingServices
IT Staffing TransactionProcessing
InfoServices
VAR
1-Ye
ar R
even
ue G
row
th
Select TM Capital Tech-Enabled Services Experience TM Capital’s Tech-Enabled Services Contacts
Bradford A. Adams Managing Director
617-259-2203 [email protected]
Jarrad S. Zalkin Managing Director
617-259-2207 [email protected]
Andrew O. Redmond Vice President 617-259-2215
Select Tech-Enabled Services Precedent M3. TES Transactions Transactions
12/23/2014
Annc. Date Sector Acquirer Target Target Description
Enterprise Value Comments
11/20/14 Info Services Solera Holdings Inc.
CAP Automotive Limited
Provider of vehicle valuation data, newvehicle information and business informationto the automotive industry
$463.8 Solera acquired CAP Automotive to enhance its riskand asset management capabilities for theautomotive and property marketplaces
11/17/14 IT Services Vedicsoft Solutions Inc.
Uclid IT Services Pvt. Ltd.
Provides information technology consultingservices in the areas of Oracle ERP anddatabase administration
NA Vedicsoft acquired Uclid IT Services through amanagement-led buyout from its founders designedto expand vertical expertise
11/06/14 Hosting Services
IT-Ernity Internet Services B.V.
XL Internet Services BV
Provides OpenStack technology-based cloudsolutions in the Netherlands
NA IT-Ernity acquired XL Internet to bolster itsinfrastructure and cloud services and solutionsportfolio
11/04/14 Hosting Services
Endurance International Group Holdings, Inc.
Arvixe LLC; BuyDom-ains.com Inc.; Webzai, LTD.
Targets provide web hosting (Arvixe), domainacquisition (BuyDomains) and webdevelopment (Webzai) solutions and services
$76.0 Endurance announced its acquisitions of Arvixe,BuyDomains and Webzai as part of a strategicinitiative to bolster its web hosting capabilities
11/04/14 Managed Services
Hitachi Sunway Information Systems Sdn Bhd
I-Net Solutions Pte. Ltd.
Provides IT solutions and services for variousstages of the enterprise IT infrastructure lifecycle
NA Hitachi Sunway acquired I-Net Solutions tostrengthen its infrastructure and managed servicesbusiness following the acquisitions of Free NetBusiness Solutions and Powerware Systems in July
11/04/14 IT Staffing Impellam Group PLC
Lorien Resourcing Limited
Provides technology recruitment consultancyservices and solutions for organizations in theUnited Kingdom
$101.9 Impellam Group acquired Lorien Resourcing as partof a corporate strategy to expand its service portfoliointo IT staffing
11/03/14 IT Services KPMG LLP EntryPoint Consulting, Global Trade Management
Provides global trade services technology andbusiness consulting services
NA KPMG acquired EntryPoint's Global TradeManagement Practice to enhance its SAP businessand technology integration services and solutions
Select Tech-Enabled Services Transactions Announced in November 2014
www.tmcapital.com
New York641 Lexington Avenue30th FloorNew York, NY 10022Tel: 212.809.1360
Boston200 Clarendon Street25th FloorBoston, MA 02116Tel: 617.259.2200
Atlanta15 Piedmont Center NE Suite 1010Atlanta, GA 30305 Tel: 404.995.6230
TEV / EBITDA Multiples Over Time
9.8x
13.0x
7.6x
8.1x
13.7x
12.8x
7.3x3.0x
5.0x
7.0x
9.0x
11.0x
13.0x
15.0x
Q2 2011 Q4 2011 Q2 2012 Q4 2012 Q2 2013 Q4 2013 Q2 2014 Nov-2014
TEV
/ EBI
TDA
ITS Offshore ITS Hosting Services IT Staffing Transaction Processing Info. & Data VAR
Notes: USD in millions Source: Capital IQ, Company SEC Filings, industry research and TM Capital estimates
