European Technology Update Member FINRA/SIPC 9 August 2012 Thierry Monjauze Thierry Monjauze Managing Director 63 Brook Street London W1K 4HS United Kingdom Phone: +44 20 7518 8900 [email protected]Francois Morin Director 63 Brook Street www.harriswilliams.com This report has been prepared by Harris Williams & Co. Ltd a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Services Authority (FRN #540892). Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business. 63 Brook Street London W1K 4HS United Kingdom Phone: +44 20 7518 8900 [email protected]
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www.harriswilliams.comThis report has been prepared by Harris Williams & Co. Ltd a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and
regulated by the Financial Services Authority (FRN #540892). Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.
VMware acquired Nicira, the provider of software defined networking and network virtualization for open source initiatives, for approximately $1.3 billionBain Capital Partners purchased a $1 billion stake in Genpact, the global leader in business process management and technology services, from General Atlantic and Oak Hill Capital Partners Synopsys acquired SpringSoft, the global supplier of specialized design software, for $406 millionA l i d A h T h US b d id f i id i d h l
Company Specific
News
Apple acquired AuthenTec, the US-based provider of security, identity management and touch control technologies for personal computers and wireless devices, for approximately $360 millionPearson acquired Author Solutions, one of the world's leading providers of professional electronic self-publishing services, from Bertram Capital for $116 million1st Auto Transport Directory, the web-based network for arranging vehicle transportation and shipping, was acquired by DealerTrack for $74 million Mobeus Equity Partners acquired Tessella, the international provider of technology and consulting services, in a management buy-out for £18 millionQurius, the IT solutions provider in the areas of design, architecture, infrastructure, deployment and systems Q , p g , , , p y ymanagement of Microsoft-based systems, was acquired by Prodware for €18.5 million Francisco Partners completed the acquisition of Kewill, the global trade and logistics software providerOne of the world's leading independent digital agencies AKQA Holdings was acquired by WPPXerox acquired WDS, the provider of technical support and related consulting services to the world’s largest wireless telecommunication brandsWeb-based business software Start-Up Box raised $125 million in a round of funding led by General Atlantic Software-coding start-up GitHub raised $100 million in a round of funding led by Andreessen HorowitzJustFab, the fashion styling service and contemporary fashion brand, raised $76 million from Rho VenturesSi D G th UK b d d i th i i f i t t d d d t iSix Degrees Group, the UK-based company engaged in the provision of integrated managed data services,raised £8 million in new funding from Penta CapitalPalo Alto Networks’ share price increased 26% in its first day of trading on the NYSE closing at $53, up from its IPO price of $42Gigamon, the US-based IT company, filed for an IPO looking to raise $100 millionXoom, the US-based online money transfer service, is preparing for an IPO and has retained Goldman Sachs as lead underwriterThe privately owned Czech anti-virus software company Avast Software has withdrawn its IPO filing
Global mobile entertainment revenues are expected to be $65 billion by 2016, up from $25 billion this year, according to Juniper ResearchMobile tech firms have generated $6.5 billion in IPO and M&A activity for the first six months of this year, according to Rutberg & Co.Global PC shipments appear to be stagnating, with both IDC and Gartner claiming that the market dipped 0.1% y-o-y in Q2 2012
Industry Trends
y o y in Q2 2012E-books made up 15% of all trade book sales in the US during 2011, up from 6% in 2010, according to the Association of American PublishersSmartphone app downloads will surpass 36 billion worldwide this year, according to ABI ResearchSpend on technology products and services such as mobile phones, computing, entertainment, media and smart devices will reach $2.1 trillion this year, with that figure set to rise to $2.7 trillion in 2016, according to GartnerGlobal online ad spend is set to continue its remarkable growth, with eMarketer forecasting that spend will increase 21.3% from $88.47 billion in 2011 to $107.33 billion in 2012
Source: Various industry news outlets. 1
Public Market Trading Statistics
Stock Performance
Last 30 Days
g
6%
8%
10%
(6%)
(4%)
(2%)
0%
2%
4%
02 Jul 07 Jul 12 Jul 17 Jul 22 Jul 27 Jul 01 Aug
DJ Stoxx 600 Technology Nasdaq Composite Software and IT Services Communications Internet and Digital Media
6.4%2.4%1.5%
(0.3% )(3.0% )
Last Twelve Months
(20%)
(10%)
0%
10%
20%
10.2%1.1%
(6.9% )(11.0% )(13.3% )
Comparable Trading
Sources: Capital IQ, 3 August 2012; Brokers’ reports.
(40%)
(30%)
Aug 2011 Nov 2011 Feb 2012 May 2012 Aug 2012
DJ Stoxx 600 Technology Nasdaq Composite Software and IT Services Communications Internet and Digital Media
European Large Cap Software 7.9%Large Cap IT Services 5.6%Security Software 4.5%Enterprise Applications 2.8%H lth S ft 1 4%
0%
5%
Healthcare Software 1.4%Mid Cap IT Services 1.3%Offshore IT Services (0.9% )Financial Software (3.2% )
(10%)
(5%)
02 Jul 08 Jul 14 Jul 20 Jul 26 Jul 01 AugEuropean Large Cap Software Financial SoftwareEnterprise Applications Healthcare SoftwareEnterprise Applications Healthcare SoftwareSecurity Software Large Cap IT ServicesMid Cap IT Services Offshore IT Services
Last Twelve Months Performance
20%
European Large Cap Software 12.7%Healthcare Software (4.9% )Financial Software (7.5% )Large Cap IT Services (7.8% )Enterprise Applications (13.6% )Security Software (16 8% )
(10%)
0%
10%
20% Security Software (16.8% )Mid Cap IT Services (19.6% )Offshore IT Services (22.1% )
(40%)
(30%)
(20%)
Aug 2011 Nov 2011 Feb 2012 May 2012 Aug 2012
Source: Capital IQ, 3 August 2012.3
European Large Cap Software Financial SoftwareEnterprise Applications Healthcare SoftwareSecurity Software Large Cap IT ServicesMid Cap IT Services Offshore IT Services
7Sources: Capital IQ, 3 August 2012; Brokers’ reports.
Internet and Digital Media
20%
Last 30 Days Performance
g
Online Travel 4.9%Global Internet Leaders 4.8%Online Classifieds 4.2%Chinese Internet Leaders 1.5%Content Providers / Communities 1.1%Ecommerce 0.4%Online Marketing (0.1% )
10%
Online Marketing (0.1% )Interactive Entertainment (3.7% )Online Gambling (4.1% )Intermediation and Comparison (12.5% )
(10%)
0%
28 Jun 04 Jul 10 Jul 16 Jul 22 Jul 28 Jul
Global Internet Leaders EcommerceO li T l O li M k tiOnline Travel Online MarketingContent Providers / Communities Intermediation and ComparisonOnline Classifieds Chinese Internet LeadersOnline Gambling Interactive Entertainment
Last Twelve Months Performance
Global Internet Leaders 18.6%Intermediation and Comparison 13.6%Online Gambling 11.0%Online Travel 1.2%50%Online Classifieds (13.4% )Online Marketing (19.1% )Content Providers / Communities (21.9% )Chinese Internet Leaders (22.5% )Ecommerce (23.8% )Interactive Entertainment (36.5% )
0%
10%
20%
30%
40%
50%
(50%)
(40%)
(30%)
(20%)
(10%)
Aug 2011 Nov 2011 Feb 2012 May 2012 Aug 2012
Global Internet Leaders Ecommerce
8Source: Capital IQ, 3 August 2012.
Global Internet Leaders EcommerceOnline Travel Online MarketingContent Providers / Communities Intermediation and ComparisonOnline Classifieds Chinese Internet LeadersOnline Gambling Interactive Entertainment
10Sources: Capital IQ, 3 August 2012; Brokers’ reports.
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