NEW YORK, Jan. 14, 2014 /PRNewswire/ -- Berkery Noyes, an independent mid-market investment bank, today released its full year 2013 mergers and acquisitions trend report for the Online and Mobile Industry. The report analyzes M&A activity in the Online and Mobile Industry during 2013 and compares it with data covering 2011 and 2012.
According to Berkery Noyes' research, transaction volume increased eight percent on a year-to-year basis. Aggregate deal value declined six percent, from $70.98 billion in 2012 to $66.59 billion in 2013. The median revenue multiple remained nearly constant at 2.2x, while the median EBITDA multiple improved from 10.0x to 12.2x. Yahoo! was the industry's most active acquirer with 27 transactions during 2013. Under CEO Marissa Mayer, Yahoo! has picked up its acquisition pace as it focuses on expanding its mobile capabilities.
Deal volume in the consumer mobile application subsector increased 31 percent, from 168 transactions in 2012 to 220 transactions in 2013. In addition, there were several instances of non-traditional buyers acquiring consumer mobile applications throughout the year. This included high value deals such as Under Armour's acquisition of MapMyFitness for $150 million and Hasbro's acquisition of Backflip Studios for $112 million.
Transaction volume in the E-Commerce segment increased nine percent over the past year. One notable E-Commerce deal was Groupon's acquisition of Ticket Monster from LivingSocial for $241 million. This divestiture reflects LivingSocial's strategic focus beyond the daily deals subsector.
The number of deals in the Communications segment increased 11 percent in 2013. This was due in part to the continued emphasis on bring-your-own-device (BYOD) policies in the workplace and the need to extend corporate security safeguards. Oracle and IBM each completed transactions in the mobile device management subsector. Along these lines, Oracle acquired Bitzer Mobile while IBM acquired Fiberlink Communications, both of which provide mobility management solutions.
The SaaS & Cloud segment experienced a 12 percent increase in volume between 2012 and 2013. It also had the highest median enterprise value multiples for the three years covered in the report at 2.9x revenue and 13.2x EBITDA, respectively.
Regarding the E-Marketing & Search segment, volume improved 12 percent, with a total of 538 deals for the year. The overall industry's largest transaction during the year was Salesforce.com's acquisition of ExactTarget for $2.27 billion, which occurred in the segment as well. In terms of other notable related deals, Oracle acquired marketing software company Responsys for $1.39 billion. Oracle also acquired Compendium Software, a content marketing provider that will complement Eloqua, the latter of which Oracle acquired in 2012. Each of these transactions is helping to strengthen Oracle's marketing cloud platform. Meanwhile, another high value transaction in the segment during 2013 was Apple's acquisition of Topsy Labs, a social analytics company that tracks data from Twitter and other social media sites, for a reported $200 million.
As for specific E-Marketing & Search subsectors, mobile marketing showed particular growth. Deal volume in the mobile marketing subset increased 30 percent over the past twelve months.
"From a general standpoint, acquirers are showing interest in solutions that can facilitate better ways of mining customer data," said Evan Klein, Managing Director of Berkery Noyes. "Many are also looking for more efficient means of leveraging content, search engine optimization capabilities, and turnkey campaign management programs." Klein continued, "The numbers in our report indicate that mobile marketing is having a strong impact on M&A activity as well, given that advertisers and brands are looking to connect with consumers in real-time using this relatively nascent platform."
A copy of the ONLINE AND MOBILE INDUSTRY M&A REPORT FOR FULL YEAR 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.
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