Berkery Noyes releases 2011 year-end Financial Technology & Information Industry M&A Acquisitions Report

January 18, 2012 — Fusion DigiNet
Berkery Noyes has released its 2011 Full Year Mergers and Acquisitions Trend Report for the Financial Technology & Information Industry.

The report analyses the sector for 2011 and compares it with similar activity in 2009 and 2010. This market includes information and technology companies in capital markets, payments, banking, insurance and other related financial services.

  • The most active acquirer between 2009 and 2011 was Thomson Reuters with 11 transactions.
  • Total transaction volume in 2011 increased by 2 percent over 2010, from 266 to 271 transactions.
  • Total transaction value in 2011 increased by 43 percent over 2010, from $20.52 billion in 2010 to $29.78 billion this year.
  • The median revenue multiple increased from 2.2x in 2010 to 2.6x in 2011, while the median EBITDA multiple decreased from 13.5x to 11.6x.

There has been a consistent improvement in the number of Capital Markets transactions, which was the only segment that saw an increase from 2010 to 2011. Indeed, the most active market segment tracked by Berkery Noyes between 2009 and 2011 was Capital Markets with 254 transactions, 100 of which were announced or closed in 2011. The segment’s transaction value for the year was $18.17 billion.

“At present we are seeing destructive creativity going on in a number of financial service sectors,” said Peter Ognibene, Berkery Noyes managing director. “For instance, smart phones have become digital wallets and are enabling a host of banking and other mobile commerce activities. There has also been an increase in consumer focus on wealth management strategies. And as always in times of turmoil and uncertainty – there is a desire for more precise and forward looking risk management tools, especially enterprise-wide.”

Click here to read the full report.

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UK private equity investment in the £10M-£10OM market grows by 44%

January 18, 2012 — Fusion DigiNet

Data from the Lyceum Capital and Cass Business School UK Growth Buyout Dashboard shows that the UK has reinforced its position as the preeminent market for private equity investment in Europe, with activity in its lower mid-market having continued its strong recovery in 2011 to pre-recession levels of almost 100 deals.

Highlighting the segment’s robustness despite macro-economic challenges, the UK Growth Buyout Dashboard, revealed 44 per cent growth in the total number of transactions last year to 91, compared to 63 in 2010 and 34 deals in 2009.

The quarterly data, which analyses UK-headquartered private equity control deals in the £10 to £100 million enterprise value space, also shows that total deal value has more than trebled over the past three years, with aggregate values in excess of £3.4 billion last year compared to over £2.2 billion in 2010 and just above £1.0 billion in 2009.

Technology, media and telecommunications (TMT) was the stand-out sector – a trend which is likely to continue, driven by growth in innovative IT solutions such as cloud computing and mobile business applications. 26 TMT deals completed during 2011, contributing to 29 per cent of completed transactions, compared to 11 a year earlier and just four in 2009.

Click here to read the full UK Growth Buyout Dashboard.

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Elsevier acquires QUOSA

January 12, 2012 — Fusion DigiNet

Elsevier, the  provider of scientific, technical, and medical information products and services, has acquired QUOSA a content management and workflow productivity solutions provider for researchers and information managers.

QUOSA’s current solutions and platform, including its Information Manager and Virtual Library, will continue to be supported. QUOSA’s technological capabilities will be developed into Elsevier-branded solutions, raising the efficiency of the search and discovery process. They will also allow researchers and information professionals to manage information more efficiently at the various stages of the research workflow including organizing, archiving and sharing.

“Elsevier is focused on delivering productivity enhancing tools to researchers and information managers to help accelerate and promote scientific discovery. Our acquisition of QUOSA ensures that we continue to deliver more value to our customers by improving the search, retrieval, management, analysis and sharing of the increasingly disparate types of information required to improve research outcomes,” said Alexander van Boetzelaer, Managing Director of Elsevier Corporate Markets. “QUOSA brings to Elsevier an innovative offering and technological expertise that align well with Elsevier today.”

Elsevier and QUOSA have collaborated successfully since 2007 when the latter’s PDF Download Manager was incorporated in SciVerse Scopus.  Later the feature was embedded in SciVerse ScienceDirect. Elsevier’s acquisition of QUOSA marks a continuation of this collaboration which has boosted research productivity for the users of both solutions.

Founded in 1996 and headquartered in Boston, QUOSA began by targeting the academic and government segments and now also serves a range of corporate customers, including more than half of the Top 25 pharma-biotech companies. Financial details of the acquisition are not being disclosed.

The Netherlands, Amsterdam & USA, Boston, MA

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AdMedia’s Industry Survey – 2012 Mergers and Acquisitions Prospects for Media, Marketing Services and Related Technology Firms

January 10, 2012 — Fusion DigiNet

AdMedia Partners has released its latest industry survey, “2012 Mergers and Acquisitions Prospects for Media, Marketing Services and Related Technology Firms.’

The report reveals the viewpoints of buyers and sellers regarding 2012 valuations, advertising spending, M&A activity, and key trends affecting all industry participants, such as the changing nature of content delivery, consumption and monetization.

Respondents were generally optimistic about prospects for their industries and their own businesses in the year ahead, and expect that strong M&A activity in 2011 will continue into 2012. They believe there will be an increase in M&A activity driven by strategic buyers with historic amounts of cash on their balance sheets, private equity firms with large amounts of uninvested capital and changing industry dynamics.

Specific survey findings include:

  • Fifty-nine percent of respondents expect to seek an acquisition, up markedly from last year when 40% had the same expectation.
  • Highlighting the fact that significant capital is sitting on the sidelines, 55% of respondents who anticipate making an acquisition expect to fund using existing cash reserves; in addition, 43% expect to raise outside equity (e.g., from a private equity firm) and 27% plan to use debt financing.
  • Almost half of respondents (48%) anticipate contemplating the sale of their company and/or subsidiary operation in 2012, a significant increase over the 36% who expressed this opinion in 2011.
  • Approximately three out of four respondents anticipate that M&A by strategic buyers will be up in 2012.
  • Almost half of respondents anticipate that M&A by financial buyers will be up in 2012.
  • The most popular areas of expansion interest within the services sector were analytics, social and mobile. User-generated content and mobile were hottest topics for content respondents.
  • Respondents predict that valuations will remain strong in 2012, particularly for mobile marketing, social marketing, and digital media firms.

Visit the AdMedia Partners website to download a full copy of the report.

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Wolters Kluwer Financial Services acquires PRINGLE Compliance Polices & Procedures content

December 15, 2011 — Fusion DigiNet

Wolters Kluwer Financial Services, a worldwide provider of compliance, risk management and audit solutions for the financial services industry, has acquired the regulatory compliance content of PRINGLE Policy and Procedure Solutions from PRINGLE Publications Corporation. The terms of the deal were not disclosed.

“What sets Wolters Kluwer Financial Services apart from our competitors is our ability to deliver actionable and intelligent regulatory compliance and risk management content to our customers,” said Brian Longe, CEO of Wolters Kluwer Financial & Compliance Services. “This acquisition allows us to provide our customers with even more value by expanding access to the industry-leading PRINGLE compliance policies and procedures content to a larger number of financial institutions.”

Wolters Kluwer Financial Services will integrate PRINGLE’s compliance and safety and soundness policies and procedures, worksheets, forms, and regulatory checklists and tests into the Policies and Procedures module of the company’s ARC Logics for Financial Services enterprise risk management solution. The company will offer its ARC Logics customers with direct access to PRINGLE content through the module, which will provide a common, dynamic platform to proactively manage, edit, and update their policies and procedures.

USA, Minneapolis, MN

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Pearson to sell 50% stake in FTSE to the London Stock Exchange for £450 million

December 15, 2011 — Fusion DigiNet

Pearson has agreed to sell its 50% stake in FTSE International Limited to the London Stock Exchange Group for £450 million in cash.

FTSE is a world-leader in the creation and management of more than 200,000 equity, bond and alternative asset class indices. With offices in London, Frankfurt, Hong Kong, Beijing, Shanghai, Madrid, Milan, Mumbai, Paris, New York, San Francisco, Sydney and Tokyo, FTSE works with partners and clients in 80 countries worldwide.

Marjorie Scardino, Pearson’s chief executive, said: “FTSE is a bellwether of global financial markets and a world-class business. We have enjoyed supporting the company’s excellent and highly professional team to build the business. Proud as we are of that long association, FTSE’s strategy is different from our own. We wish it every success as we continue to build our digital business information services around the Financial Times.”

Pearson and London Stock Exchange Group currently each own 50% of FTSE. Under the terms of the agreement, London Stock Exchange Group will acquire from Pearson the 50% of FTSE that it does not own and continue to use the FTSE name. The transaction is expected to close by the first quarter of 2012.

In 2010, FTSE reported total revenues of £98.5 million and total EBITDA of £40 million. At 31 December 2010, FTSE had gross assets of £100.8m.

Pearson expects FTSE to make a total post-tax contribution to Pearson’s adjusted earnings of approximately £18 million or 2.2p per share in 2011.

The transaction follows the sale of Pearson’s stake in Interactive Data last year for $2bn. It marks Pearson’s exit from companies that are primarily providers of financial data and strengthens the FT Group’s focus on global business news, analysis and intelligence, increasingly delivered through subscription models and digital channels.

Pearson intends to use the proceeds of the sale to support and accelerate its strategy, investing in its businesses both organically and through acquisitions of companies with complementary content, technology and geographic exposure. In recent years Pearson’s organic investments have enabled it to gain share in many of its markets. The company has also made a series of bolt-on acquisitions (including vocational training companies in the UK, global business intelligence through Mergermarket, universities in South Africa, online learning businesses in North America, language schools in China and school systems in Brazil) which have rapidly enhanced Pearson’s earnings and return on invested capital.

UK, London

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Moody’s Corporation acquires majority stake in Copal Partners

November 19, 2011 — Fusion DigiNet

Moody’s Corporation has acquired a majority stake in the companies of Copal Partners. Copal’s companies are among the world’s leading providers of outsourced research and analytical services to institutional customers. The terms of the transaction were not disclosed.

Copal’s analytical resources support front-line professionals at financial institutions and corporate enterprises worldwide. With expertise in a wide range of disciplines, including financial modeling, industry and company research, capital structure analysis and market surveys, Copal deploys a flexible staffing model to meet the specific requirements of its customers.

“Copal is highly regarded in the global financial services industry as a leader in high quality research and analytical services for bankers, financial analysts and institutional investors,” said Mark Almeida, President of Moody’s Analytics. “This acquisition extends Moody’s Analytics’ capabilities, enabling us to better help financial institutions manage risk. In addition, Copal’s expertise and resources will allow us to accelerate innovation across Moody’s Analytics.”

The acquisitions do not alter Moody’s 2011 earnings per share (EPS) guidance, and are expected to be accretive to Moody’s EPS in 2012. Moody’s funded the purchases from cash on hand.

Moody’s was advised on the transaction by Citi and Slaughter and May. Copal Partners was advised by Centerview Partners and Macquarie Capital. Proskauer Rose served as legal advisors for Copal.

USA, New York, NY

 

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mergermarket Q3 Monthly M&A Insider report

November 2, 2011 — Fusion DigiNet

According to the mergermarket Q3 Monthly M&A Insider report (October 2011), global m&a in the first three quarters of 2011 totalled us$1,718bn – a 21.5% increase from the us$1,414.4bn worth of deals registered in the first three quarters of 2010 – and the financial services sector saw an even steeper 37.4% increase during this nine-month window. The first three quarters of 2011 brought us$208.5bn in financial services deals to market, up from us$151.7bn in the same period last year,

Sectors covered by Fusion DigiNet

The largest sector by market share was Energy, Mining and Utilities at 23.1% (835 deals) down 10% (-125 by volume), in 7th place is Business Services at 4.4% (1,159 deals) -17% (+62 by volume), media is in 8th place at 1.9% (279 deals) +23% (no change by volume).

See the full report at mergermarket

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TrueCar acquires ALG

October 5, 2011 — Fusion DigiNet

TrueCar, a publisher of real-time new and used vehicle pricing data in the U.S. market, has completed its acquisition of ALG. formerly a subsidiary of DealerTrack Holdings. and an industry source for automotive residual values.

“TrueCar has shown a tremendous commitment to maintaining the continuity of ALG operations,” said Raj Sundaram, Senior Vice President of the Services and Solutions Group at DealerTrack Holdings.  “The TrueCar executive team has exhibited a profound understanding and respect for the strong relationship ALG has with the entire automotive industry – and I believe they will actively seek ways maintain and enhance that relationship now and in the years to come.”

TrueCar has also announced that Larry Dominique will be joining TrueCar as Executive Vice President of the Data Solutions Group. Dominique comes to TrueCar from Nissan North America where he served as Vice President, of Advanced and Product Planning and Strategy.

USA, Santa Monica, CA

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Report: Quarterly analysis of UK-headquartered private equity control deals in the £10 million to £100 million segment

October 5, 2011 — Fusion DigiNet

  The volume and value of deals completed during the first nine months of 2011 in the lower mid- market investment space has increased year on year for the past three years, according to research from Lyceum Capital and Cass Business School.

For more information, visit the Lyceum Dashboard

Data from The UK Growth Buyout Dashboard – a quarterly analysis of UK-headquartered private equity control deals in the £10 million to £100 million segment – shows that 63 transactions completed between 1 January 2011 and 30 September 2011. This compares to 50 investments for the same period of 2010 and just 25 during the first nine months of 2009.

During Q3 2011, deal volume has built on an encouraging first six months of 2011 with a greater number of deals completed than in Q2. The combined value of those deals fell slightly (from £794 million to £785 million) but both volume and value of deals was still higher than the same quarter of 2010.

Q3 deal value being lower than Q2 despite five more transactions, indicates that there are fewer large deal opportunities however the lower mid-market continues to replenish itself as new businesses enter the space looking to grow with private equity investment.

Transaction sizes

The combined deal value of £785 million exceeds the £698 million recorded during Q3 2010 and the £220 million of Q3 2009.

The highest transaction value recorded in the last three months was £87.8 million, compared to a high of £100 million in Q2 H1 2010.

Meanwhile, transactions valued between £50 million and £100 million fell from seven in Q2 to five in Q3. The majority of the 22 lower mid-market deals completed were in the £26 million – £50 million range, with 86 per cent under £50 million.

The increase in deal activity indicates that there is a growing appetite for investment and that transactions should continue to rise unless there is a significant reversal in the state of the wider economy. There may not currently be the appetite for the larger end deals in the mid-market space but as long as volume maintains its upward trend, the necessary deal flow which keeps the market moving does exist.

Transaction types

Management buyouts (MBOs) and secondary buyouts (SBOs) remained the most prevalent transaction types for private equity investors, but the number of MBOs completed in Q3 2011 actually fell to nine from 12 in Q3 2010 – lower than each of the previous six quarters back to Q1 2010.

There were also two public to private delistings during Q3, compared to one in each of the previous two quarters.

No Initial Public Offerings (IPOs) were recorded, a trend which stretches back to Q1 of 2010 and is unsurprising in a financial climate of weak capital markets where so many anticipated floats have been shelved.

Trade, IPO and secondary exits

A total of nine secondary buy-outs (SBOs) characterised the quarter – the highest number of any quarter during the last two years and an indication that private equity firms are now beginning to sell assets that they have held onto throughout the depths of the economic downturn.

There were six exits to trade, higher than the previous two quarters but lower than the eight which took place in Q3 2010.

Investments by industry

Technology, media, telecommunications (TMT) businesses continue to dominate the lower mid- market with eight out of 22 deals this quarter (38 per cent) and five transactions in business support services.

Retail – undoubtedly one of the sectors hardest hit by a dip in consumer spending – continues an encouraging run of three deals or more completing in every quarter since Q2 2010.

Commentary

Andrew Aylwin, Partner at Lyceum Capital, said: “In the £10m to £100m value range, UK private equity deal volumes continue to recover. With 63 completed transactions so far for the 9 months to 30th September, the market is trending back to historical norms of 100+ control deals a year. The UK lower mid-market segment remains a plentiful source of high quality opportunities across a range of sectors and private equity firms such as Lyceum Capital continue to play a key role in supporting dynamic companies that need capital to continue their successful development and drive the recovery of UK plc.”

Professor Scott Moeller at Cass Business School commented further: “This performance of the UK lower- mid market in the third quarter is in distinct contrast to the overall market when much larger deals of £100 million plus are considered. That market has declined during the past two quarters and some reports show it declining dramatically in Q3 – Bloomberg, for example, this week reported a 43 per cent decline in deals with European purchasers for the overall market. Therefore, the volume of deals in the lower mid market is encouraging in this difficult economic environment, and may prove in the next quarter to continue to be resilient. There is further evidence in our figures of a positive shift in the market with a strong mix of industries, including healthcare, which was absent last quarter and a resurgence in technology deals.”

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