2014

Berkery Noyes Releases Financial Technology And Information Industry M&A Report For Third Quarter 2013

NEW YORK, Oct. 14, 2013 /PRNewswire/ -- Berkery Noyes, an independent mid-market investment bank, today released its third quarter 2013 mergers and acquisitions trend report for the Financial Technology and Information Industry.

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The report analyzes M&A activity for the sector during the first three quarters of 2013 and compares it with data covering 2012. This market includes information and technology companies in Capital Markets, Payments, Banking, Insurance, and other related financial services.

Both volume and value experienced an increase in third quarter 2013. Deal volume in the quarter reached its highest point throughout the past year-and-a-half, with a total of 93 transactions. Aggregate value was tied with its second highest level during this period, at $8.5 billion. The median revenue multiple from 2012 through the first three quarters of 2013 declined from 2.9x to 2.5x, while the median EBITDA multiple moved slightly from 11.6x to 12.0x.

Six of the report's top ten largest deals year-to-date occurred within the Banking segment. Three of these six transactions occurred in third quarter 2013: Davis + Henderson Corporation's acquisition of Harland Financial Solutions for $1.6 billion, Thoma Bravo's acquisition of Intuit Financial Services for $1.0 billion, and CoreLogic's acquisition of Marshall & Swift/Boeckh (MSB) and DataQuick from Decision Insight Information Group for $661 million. Two factors broadly impacting M&A in the segment are the desire to provide fuller product suites and the need to maintain compliance with new regulations.

"Some small and mid-sized financial institutions are seeking to outsource their compliance functions in order to focus on lending and serving their clients," said John Guzzo, Managing Director at Berkery Noyes. "As a result, we are seeing technological growth in specific bank niches, which is often followed by investments in products and companies that offer these innovative solutions. The outlook for M&A remains robust, especially while the regulatory landscape continues to rapidly evolve."

Deal volume in the Insurance segment year-to-date increased 13 percent when compared to the corresponding timeframe in 2012. One notable transaction in the segment during third quarter 2013 was LexisNexis' acquisition of Mapflow, which provides geographic risk assessment technology and underwriting solutions. "There are a lot of changes occurring in the Insurance sector," stated Peter Ognibene, Managing Director at Berkery Noyes. "For one thing, technologies such as data visualization solutions are providing more insight into existing datasets. Moreover, the ability to interpret unstructured data from multiple external sources can improve the ability to collect information and thus market to new clients. Insurers are continuing to look for better ways to leverage their analytical capabilities, and the positive impact this is having on acquisition activity has become evident."

As for the Payments segment, M&A volume experienced a 142 percent increase in the quarter, with a total of 29 deals. This came in the aftermath of a 50 percent decrease between first and second quarter 2013. Regarding strategic acquirers, the segment's highest value transaction in third quarter 2013 was EBay's acquisition of Braintree Payment Solutions for $800 million. EBay is planning to integrate Braintree's online and mobile payment processing platform with its PayPal division, in an effort to continue growing PayPal's mobile business. Meanwhile, the segment's largest financially sponsored deal during the quarter was CVC Capital Partners' acquisition of Skrill Group, an online payments company and digital wallet provider based in Europe, for a purchase price of $601 million.

In addition to the changes occurring around digital commerce, one notable trend is that more merchants are beginning to utilize point-of-sale (POS) tablet and mobile based payment systems to increase efficiency, boost sales, and improve the retail experience.

A copy of the FINANCIAL TECHNOLOGY AND INFORMATION INDUSTRY M&A REPORT FOR THIRD QUARTER 2013 is available at the Berkery Noyes website.

About Berkery Noyes

Berkery Noyes is an independent investment banking advisory firm servicing the information industry. The firm specializes in mergers and acquisitions advisory, debt and equity financing, and financial consulting services for companies in the $10 million to $500 million range. Since its founding by Joseph W. Berkery in 1983, Berkery Noyes has worked with corporate clients to grow through acquisition, divest non-core assets, and maximize shareholder returns through strategic transactions and restructurings. For private owners, Berkery Noyes helps create liquidity and execute timely exit strategies that achieve their personal and professional objectives. The firm's research teams publish acquisition activity in the respective sectors they follow on MandAsoft.com.

Securities services are offered through Berkery Noyes Securities, LLC. For more information, visit www.berkerynoyes.com.

­­­Contact Information:
Peter Wilson
Berkery Noyes
646-442-7966
peter.wilson@berkerynoyes.com

SOURCE Berkery Noyes



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