www.harriswilliams.de Harris Williams & Co. Ltd is a private limited company incorporated under English law having its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales under company number 7078852. Directors: Mr. Christopher Williams, Mr. Ned Valentine, Mr. Paul Poggi and Mr. Thierry Monjauze, authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. Ltd Niederlassung Frankfurt (German branch) is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Frankfurt am Main, Germany, under registration number HRB 96687, having its business address at Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany. Permanent Representative (Ständiger Vertreter) of the Branch Niederlassung: Mr. Jeffery H. Perkins. EUROPEAN TECHNOLOGY INDUSTRY UPDATE │ OCTOBER 2015
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www.harriswilliams.de
Harris Williams & Co. Ltd is a private limited company incorporated under English law having its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered withthe Registrar of Companies for England and Wales under company number 7078852. Directors: Mr. Christopher Williams, Mr. Ned Valentine, Mr. Paul Poggi and Mr. Thierry Monjauze,authorised and regulated by the Financial Conduct Authority.
Harris Williams & Co. Ltd Niederlassung Frankfurt (German branch) is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Frankfurt am Main,Germany, under registration number HRB 96687, having its business address at Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany. Permanent Representative(Ständiger Vertreter) of the Branch Niederlassung: Mr. Jeffery H. Perkins.
EUROPEAN TECHNOLOGYINDUSTRY UPDATE │ OCTOBER 2015
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www.harriswilliams.de
RECENT DEVELOPMENTS
1
COMPANY SPECIFIC NEWS
Dell has agreed to acquire all outstanding shares of EMC, the US-basedprovider of information storage systems, software, networks and services,valuing the business $63.3bn Euskaltel has agreed to acquire R Cable Y Telecomunicaciones Galicia, the
Spain-based provider of telephony, broadband/Internet, and multi-channelthematic television solutions, from CVC Capital Partners, valuing the business at€1.2bn Carlyle Europe has agreed to acquire a 51% stake in PA Consulting Group, the
UK-based provider of management and IT consulting, technology andinnovation services, valuing the business at c.$1.0bn Capita has reached an agreement to acquire Xchanging, the UK-based
provider of outsourcing and back office services for human resourcesmanagement, procurement, accounting and settlement and customeradministration, valuing the business at £453m comScore has signed a definitive agreement to acquire Rentrak, the US-based
provider of content measurement and analytical services to the entertainmentindustry, in a stock for stock merger transaction, valuing the business at $754m Entertainment One has agreed to acquire a 70% stake in Astley Baker Davies,
the UK-based company engaged in the production and creation of Peppa Pigthe pre-school animation series, valuing the business at £200m ProSiebenSat.1 Media has agreed to acquire eTRAVELi, the Sweden-based
online travel agent, from Segulah, valuing the business at €235m Ingram Micro has entered into definitive agreement to acquire Docdata
Nederland and DOCdata International, the provider of eCommerce solutions fororder fulfilment, returns logistics and online payment service, from DOCDATA,valuing the business at €155m PAI Partners has acquired a 40% stake in Grupo Konecta, the Spain-based
provider of outsourcing services and solutions, from Banco Santander, forc.€130m Rapid7 has acquired Logentries, the Ireland-based provider of machine data
search technology, valuing the business at $68m Capita has acquired Electranet, the UK-based company engaged in design,
installation and maintenance of IT servers, data centres and wireless networks,from Palatine Private Equity, valuing the business at £37m Zendesk has acquired We Are Cloud, the France-based designer and
developer of a SaaS business intelligence application BIME, from Alven CapitalPartners LDC has agreed to acquire PEI Media Group, the UK-based provider of financial
information services to global finance and investment communities active in thealternative asset classes SAP has acquired Multiposting, the France-based developer of online software
solutions for the human resources industry, from Kernel Investissements Marlin Equity Partners has acquired Bluegarden, the Denmark-based holding
provider of cloud-based payroll and HR administration software EQT has agreed to acquire a majority stake in kfzteile24, the Germany-based
online retailer of automotive spare parts and accessories Smartbox Experience has acquired Dakota Editions, the France-based gift box
e-retailer and publisher of travel guides and art books Mimecast, the UK-based provider of email management solutions, has
announced plans to raise $100m through an IPO
EUROPEAN TECHNOLOGYINDUSTRY UPDATE │ OCTOBER 2015
CONTENTS RECENT DEVELOPMENTS PUBLIC MARKET TRADING SOFTWARE IT SERVICES COMMUNICATIONS INTERNET AND DIGITAL MEDIA
TMT GROUP OVERVIEWOur Technology, Media & Telecom (TMT) Group is dedicated to providing superior merger & acquisition and capital markets advisory services to market leading companies. Our extensive industry knowledge and transaction leadership experience spans the software, digital media, IT services and communications sectors. Our professionals in London, Boston and San Francisco have global relationships with leading technology companies and financial investors. Thoughtful advice, deep experience and technology expertise, creativity and attention to detail from our senior technology bankers have resulted in a track record of consistently exceeding our clients' expectations.
Spending on Mobile Technologies spend is expected to reach $1.2tn by 2019, representing a CAGR of5.9% from 2014, according to IDC
eMarketer estimates UK adults' average total daily mobile time will reach 2 hours 24 minutes this year, up27 minutes from 2014 and representing a 500% increase from 2011
New data from Juniper Research has found that the digital games industry is expected to generatesoftware revenues of just over $80bn this year, rising to $104bn by the end of 2018, representing a CAGRof 9.1%. The majority of this growth will stem from the contributions made by the PC market, accountingfor 42% of games revenues this year
According to research released by Forrester, in 2020 14.6% of Western European advertising spend willcome from online display advertising, up from 10.1% in 2015. Online display advertising spend isexpected to grow to €17.8bn in 2020, representing a CAGR of 12.1%, with the UK remaining the largestonline display market in Western Europe
Consumer spending on communications services is expected to grow at a CAGR of 1.2% through 2019to reach $1.1tn, according to Gartner
According to research release by Juniper Research, by the end of 2015, the number of mobile bankingusers globally will exceed 1bn and reach 2bn by 2020 (37% of the global adult population), representinga CAGR of 14.9%
INDUSTRY TRENDS
RECENT DEVELOPMENTS
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EUROPEAN TECHNOLOGYINDUSTRY UPDATE │ OCTOBER 2015
LAST TWELVE MONTHS
Stock PerformanceLAST 30 DAYS
PUBLIC MARKET TRADING STATISTICS
Source: Various industry news outlets
13.8%13.5%13.1%12.4%9.0%
(8.5%)
(10%)
(8%)
(6%)
(4%)
(2%)
0%
2%
4%
6%
8%
10%
16 Sep 23 Sep 30 Sep 07 Oct 14 Oct
Communications DJ Stoxx 600 TechnologyInternet and Digital Media IT ServicesSoftware Nasdaq Composite
(1) Vivendi has entered into discussions to merge with Gameloft
(1)
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(40%)
(20%)
0%
20%
40%
60%
80%
100%
Oct 2014 Jan 2015 Apr 2015 Jul 2015 Oct 2015
Chinese Internet Leaders Content Providers / Communities Digital Marketing eCommerce
Global Internet Leaders Interactive Entertainment Intermediation and Comparison Online Classifieds
Online Travel Online Gambling Internet Services Educational Technology
INTERNET AND DIGITAL MEDIA
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EUROPEAN TECHNOLOGYINDUSTRY UPDATE │ OCTOBER 2015
LAST 30 DAYS PERFORMANCE
LAST TWELVE MONTHS PERFORMANCE
(20%)
(15%)
(10%)
(5%)
0%
5%
10%
15%
20%
16 Sep 23 Sep 30 Sep 07 Oct 14 Oct
Chinese Internet Leaders Content Providers / Communities Digital Marketing EcommerceGlobal Internet Leaders Interactive Entertainment Intermediation and Comparison Online TravelOnline Classifieds Online Gambling Internet Services Educational Technology
Educational Technology 12.8%Intermediation and Comparison 11.6%Online Gambling 7.5%Interactive Entertainment 5.5%Chinese Internet Leaders 4.5%Internet Services 2.8%Ecommerce 2.1%Online Travel 1.6%Online Classifieds 1.0%Content Providers / Communities 0.0%Global Internet Leaders (0.3%)Digital Marketing (3.0%)
Interactive Entertainment 86.2%Online Gambling 68.2%Educational Technology 67.6%Online Travel 26.6%Ecommerce 13.2%Global Internet Leaders 9.4%Chinese Internet Leaders 6.6%Digital Marketing 1.8%Intermediation and Comparison 0.9%Online Classifieds (13.2%)Internet Services (21.5%)Content Providers / Communities (23.3%)
(1)
(1)
(1) Education Technology index has been normalised to reflect Graham Holdings’ spin-off of its cable segment
Harris Williams & Co. has a broad range of industry expertise, which creates powerful opportunities. Our clients benefit from our deep-sector experience, integrated industry intelligence and collaboration across the firm, and our commitment to learning what makes them unique. For more information, visit our website.
Capital IQ as of 15th October 2015, broker reports and various industry news outlets
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SOURCES
EUROPEAN TECHNOLOGYINDUSTRY UPDATE │ OCTOBER 2015
Harris Williams & Co. (www.harriswilliams.de) is a preeminent middle market investment bank focused on the advisory needs of clients worldwide. The firm has deep industry knowledge, global transaction expertise, and an unwavering commitment to excellence. Harris Williams & Co. provides sell-side and acquisition advisory, restructuring advisory, board advisory, private placements, and capital markets advisory services.
Harris Williams & Co. Ltd is a private limited company incorporated under English law having its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales under company number 7078852. Directors: Mr. Christopher Williams, Mr. Ned Valentine, Mr. Paul Poggi and Mr. Thierry Monjauze, authorised and regulated by the Financial Conduct Authority.
Harris Williams & Co. Ltd Niederlassung Frankfurt (German branch) is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Frankfurt am Main, Germany, under registration number HRB 96687, having its business address at Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany. Permanent Representative (Ständiger Vertreter) of the Branch Niederlassung: Mr. Jeffery H. Perkins.
THIS REPORT MAY CONTAIN REFERENCES TO REGISTERED TRADEMARKS, SERVICE MARKS AND COPYRIGHTS OWNED BY THIRD-PARTY INFORMATION PROVIDERS. NONE OF THE THIRD PARTY INFORMATION PROVIDERS IS ENDORSING THE OFFERING OF, AND SHALL NOT IN ANY WAY BE DEEMED AN ISSUER OR UNDERWRITER OF, THE SECURITIES, FINANCIAL INSTRUMENTS OR OTHER INVESTMENTS DISCUSSED IN THIS REPORT AND SHALL NOT HAVE ANY LIABILITY OR RESPONSIBILITY FOR ANY STATEMENTS MADE IN THE REPORT OR FOR ANY FINANCIAL STATEMENTS, FINANCIAL PROJECTIONS OR OTHER FINANCIAL INFORMATION CONTAINED OR ATTACHED AS AN EXHIBIT TO THE REPORT. FOR MORE INFORMATION ABOUT THE MATERIALS PROVIDED BY SUCH THIRD PARTIES, PLEASE CONTACT US AT +44 (0) 20 7518 8900.
The information and views contained in this report were prepared by Harris Williams & Co. Ltd (“Harris Williams”). It is not a research report, as such term is defined by applicable law and regulations, and is provided for informational purposes only. It is not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any financial instruments or to participate in any particular trading strategy. The information contained herein is believed by Harris Williams to be reliable but Harris Williams makes no representation as to the accuracy or completeness of such information.
Harris Williams and/or its affiliates may be market makers or specialists in, act as advisers or lenders to, have positions in and effect transactions in securities of companies mentioned herein and also may provide, may have provided, or may seek to provide investment banking services for those companies. In addition, Harris Williams and/or its affiliates or their respective officers, directors and employees may hold long or short positions in the securities, options thereon or other related financial products of companies discussed herein. Opinions, estimates and projections in this report constitute Harris Williams’ judgment and are subject to change without notice. The financial instruments discussed in this report may not be suitable for all investors and investors must make their own investment decisions using their own independent advisors as they believe necessary and based upon their specific financial situations and investment objectives. Also, past performance is not necessarily indicative of future results. No part of this material may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams’ prior written consent.