27% growth in global TMT deal activity in 2014, according to G2Mi Research study

Global TMT deal activity in 2014

Email: [email protected] Tel: + 44 (0) 208 180 7223

An analysis of M&A activity, private equity/venture investments and sports’

rights deals

January 2015

2

ABOUT THE AUTHOR

This report is published by Heernet Ventures Limited. The company provides research, analysis and advisory services to the global TMT industry and operates the TMT industry

research website, G2Mi.com. For further details on Heernet Ventures, please visit the company website, heernet.com.

Published by:

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Tel: +44 (0) 208 180 7223

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liability for any errors or omissions within this report. Unless specified, the views expressed in this report are purely those of the author.

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In 2014, G2Mi Research monitored over 9,100 deals (27% increase on 2013). Deals with a

disclosed value (4,863 deals) had an aggregate value of USD 470.6 billion (9% increase on

2013). 2014 has proved to be an extremely busy time for the global TMT sector, across the full

range of deal activity from first round tech investments to large acquisitions.

This report contains a small selection of our analysis on 2014 TMT deals.

Our deal intelligence service provides our clients with the broadest range of deal data in the

global TMT landscape. G2Mi Research offers many benefits:

Tracks mergers and acquisitions, private equity and venture investments, broadcasting

rights deals and major partnerships;

Excellent coverage of both developed and emerging markets’ activity;

Comprehensive coverage of the TMT sector, including traditional media, telecom services,

and technology hardware;

Data covers a wider range of deals than other services;

The full G2Mi research platform combines transactions data with a company profiles

database and over a 1,000 regularly updated industry reports covering the global TMT

sectors.

© G2Mi Research 3

*Calculated on 18th April 2014

Harjinder Singh-Heer

Managing Director, G2Mi Research

E: [email protected]

T: +44 (0) 208 180 7223

“22,750 TMT deals monitored in the

previous three years”

Over 9,000 deals analysed in 2014 – a 27% increase on 2013

© G2Mi Research 4*Includes deals where value was not disclosed

Deal volumes: all deals* by sector

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2012 2013 2014

Nu

mb

er

of d

ea

ls

Telecoms

Tech software & services

Tech hardware

Media

Marketing services

Internet

+ 11%

+ 27%

Over half of all deals (56%) involved a target or investee based in

North America

© G2Mi Research 5*Includes deals where value was not disclosed

Deal volumes: all deals* by region of target/investee

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2012 2013 2014

Nu

mb

er

of d

ea

ls

North America

Middle East

Latin America

Europe

Australasia

Asia

Africa

The average deal value was USD 508 mn – down from USD 633 mn

in 2013

© G2Mi Research 6*Includes deals where value was not disclosed

Average Deal Value by sector and deal type

16.8

20.3

21.6

21.9

12.7

94.5

16.5

353.0

108.2

815.2

1,235.3

245.7

1,307.8

507.9

- 200.0 400.0 600.0 800.0 1,000.0 1,200.0 1,400.0

Internet

Marketing services

Media

Tech hardware

Tech software & services

Telecoms

All TMT deals

Average Deal Value (USD mn)

M&A

Investments

Deal activity by Chinese companies and investors grew strongly in

2014

© G2Mi Research 7

% change in M&A deal volumes (by country of acquiror) % change in investment deal volumes (by country of investor)

-40%

-20%

0%

20%

40%

60%

80%

Chin

aF

inla

nd

Po

lan

dIr

ela

nd

Sw

itzerlan

dF

rance

Au

str

alia

United K

ingdom

United A

rab E

mirate

sS

weden

Denm

ark

Isra

el

India

So

uth

Afr

ica

Italy

United S

tate

sN

ew

Ze

ala

nd

So

uth

Kore

aG

erm

any

Jap

an

Sp

ain

Sin

ga

pore

Neth

erla

nds

Bra

zil

Au

str

iaC

anada

Indonesia

Norw

ay

Russia

% c

hange in

deal volu

mes

-100%

-50%

0%

50%

100%

150%

200%

250%

300%

Indonesia

Fin

lan

dC

hin

aD

enm

ark

So

uth

Kore

aJap

an

Neth

erla

nds

Sw

eden

United A

rab E

mirate

sU

nited K

ingdom

India

Au

str

iaB

razil

United S

tate

sC

anada

New

Ze

ala

nd

Au

str

alia

Fra

nce

Italy

Isra

el

So

uth

Afr

ica

Sin

ga

pore

Irela

nd

Germ

any

Po

lan

dS

pain

Sw

itzerlan

dN

orw

ay

Russia

% c

hange in

deal volu

mes

Africa was a particularly active region for deals in the telecom

sector

© G2Mi Research 8*Includes deals where value was not disclosed

Deal volumes: all deals* by region of target/investee and sector

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

% s

hare

of deal volu

me

North America

Middle East

Latin America

Europe

Australasia

Asia

Africa

TMT deal activity continues to be led by the internet and software

sector

© G2Mi Research 9

Number of disclosed deals Value of disclosed deals

-

1,000

2,000

3,000

4,000

5,000

6,000

2013 2014

Num

ber

of

deals

Internet Marketing services

Media Tech hardware

Tech software & services Telecoms

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

2013 2014D

eals

' valu

e (

US

D m

illio

n)

Internet Marketing services

Media Tech hardware

Tech software & services Telecoms

The traditional media sector saw a strong increase in M&A deal

activity

© G2Mi Research 10

M&A deals: value of deals by sector PE/VC deals: value of deals by sector

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

2013 2014

Deals

' valu

e (

US

D m

n)

Internet Marketing services

Media Tech hardware

Tech software & services Telecoms

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

2013 2014D

eals

' valu

e (

US

D m

n)

Internet Marketing services

Media Tech hardware

Tech software & services Telecoms

Asia (particularly China and India) saw a strong increase in venture

investment in 2014

© G2Mi Research 11

M&A deals: value of deals by region PE/VC deals: value of deals by region

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

2013 2014

Dea

ls' v

alu

e (U

SD m

n)

Africa Asia Australasia Europe

Latin America Middle East North America

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

2013 2014D

eals

' val

ue

(USD

mn

)

Africa Asia Australasia Europe

Latin America Middle East North America

Russia saw a significant decline in deal activity – with economic

sanctions and falling oil prices weakening the Russian economy

© G2Mi Research 12

Change on deal activity (deal volumes) in selected countries

+23%

+31%

+12%

+42%

+97%

-51%

Data on deal volumes

© G2Mi Research 13Data excludes rights deals and partnerships

Typ

e

Reg

ion

Of

Targ

et

/

Inv

este

e

Alt

ern

ati

ve

med

ia

Bu

sin

ess

med

ia

Co

ns

um

er

pu

bli

sh

ing

En

tert

ain

men

t

Inte

rnet

Mark

eti

ng

serv

ices

Med

ia

(Gen

era

l)

Med

ia

facil

itie

s a

nd

so

luti

on

s

Pro

fessio

na

l

med

ia

Sp

ort

s m

ed

ia

Tech

no

log

y

Hard

ware

Tech

no

log

y

So

ftw

are

&

Serv

ices

Tele

co

ms

Tele

vis

ion

an

d

Rad

io

To

tal

PE/VC

Investments

Africa 1 12 3 4 1 21

Asia 1 1 1 6 546 1 2 14 2 10 222 7 1 814

Australasia 28 1 1 26 1 57

Europe 6 3 2 475 5 1 1 7 3 18 325 14 11 871

Latin America 30 1 13 44

Middle East 1 63 2 4 42 3 1 116

North America 6 14 2 11 1,460 31 4 13 33 2 59 1,179 30 11 2,855

M&A Deals

Africa 1 3 11 15 1 1 2 2 1 12 13 2 64

Asia 2 6 6 7 158 25 3 6 11 7 4 51 19 10 315

Australasia 5 3 1 35 9 9 5 37 6 6 116

Europe 5 24 24 12 336 96 4 19 9 24 6 284 59 50 952

Latin America 1 3 2 1 26 11 1 3 11 8 2 69

Middle East 1 1 31 3 1 15 4 2 58

North America 18 41 77 31 787 155 11 30 63 16 21 763 53 81 2,147

Total 33 103 119 75 3,998 351 25 76 153 61 123 2,983 221 178 8,499

Deal volumes by type, region of target and sector

Research notes

This analysis is based on the deals, G2Mi Research tracked in the G2Mi transactions database. The data is

gathered from publicly available sources and through contact with companies and financial advisors.

The reported date shown is the date on which the deal was made public.

Deals where value is disclosed are referred to as disclosed deals in this note

USD values are calculated from local currency using an average exchange rate for 2014

Rights data is primarily focused on sports broadcasting rights

If you identify an omission or an error, please email us at [email protected]

© G2Mi Research 14

G2Mi Transactions Data offering

© G2Mi Research 15

Basic SearchBasic Search

Transactions data can be searched

using both keyword and filtering

options. The basic options include:

- Transactions type

- Date

- Country

Advanced Search

Advanced search allows search by:

- Deal value

- Sector

- location, type and name of key deal

participants

Download data options

Both PDF and Excel formats

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For further information on G2Mi research, visit G2Mi.com

16

Email: [email protected]

Phone: +44 (0) 208 180 7223