MA Flash Report November 2009 Final

8/8/2019 MA Flash Report November 2009 Final

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www.corumgroup.com

M&A Flash ReportM&A Flash Report Nov. 2009Nov. 2009Software and IT Industry Market Update

Thursday, November 5, 200910:00 am PT


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Corum Group Presentation 2

Monthly M&A Flash Report

>> For todays presentation or more information, contact Pat Sultan([email protected], +1 425-455-8281 ext. 248)

Charles RimCorporate DeveloperGoogle

Bruce MilneCEOCorum Group Ltd.

Bruce Milne, CEO and founder of Corum, has overseen more M&A transactions than anyone in the worldover the past 25 years, generating over $6 Billion in wealth for clients in 24 countries.

He has founded or owned four software companies, including AMI, the worlds largest vertical marketsoftware firm, and was a founding investor in some of the most innovative firms in their field, includingBlue Coat, Bright Star and Sabaki.

A recognized industry expert, he has served as a personal advisor to Bill Gates on operating systems,Apple on the development of the Mac, and as one of top 10 industry advisors to IBM. He has served onthe board of Washington Technology Center at the University of Washington, and is the founder of theWTIA, the nations leading regional technology trade association.

Outside the U.S. he worked with the Canadian government to f ound SoftWorld, and he was recentlychosen as one of the 200 most inf luential individuals in the IT community in Europe. He is also the only

juror from North America for the Tornado 100 Awards in Europes.

A Deans List graduate in International Business from the UW, and a graduate With Distinction fromHarvard Business School, Mr. Milne has written three book, including Power Planning, How To StructureYour Software Company For Success.

Dougan MilneDirector of ResearchCorum Group Ltd.

Mark ReedExecutive Vice PresidentCorum Group Ltd.


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Agenda

Overview of Current Market

Market and Valuation Analysis

Charles Rim - Google

Closing Comments - Q&A


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World Overview

U.K. Services Index Rises to Highest in Two Years

Asia to Grow More Than Forecast, Adding Asset-Bubble Risk, World Bank Says

U.K. Consumer Confidence Holds at 1 -Year Highon House Price Recovery

Europe Manufacturing, Services Industries Expandfor Ninth Straight Month

Carlsberg Cuts 2009 Sales Forecast as RussiaContracts More Than Expected


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World Overview

European Producer Prices Drop for Ninth Month asEnergy Costs Plummet 17%

Gold Extends Record High on India Purchase

Nissan Returns to Quarterly Profit on China Sales


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U.S. Overview

Time Warner Raises Annual Forecast, Reports Profitthat Exceeds Estimates

Service Industries in U.S. Probably Expanded as

Economic Recovery Spread Dollar Drop Continues

Retailers Optimistic About October Sales

Ford has over $1Billion profit for quarter

Cash for Clunkers Program was Almost Half of theWhole GDP Gain


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Financial Industry

Ministers Points to US/Europe Currency Collapse

UBS Rocked by Fresh Losses

U.K. TO Inject 37bn into Lloyds and RBS

The World Bank and IMF are raising concerns thatefforts by governments and central banks to stoke arecovery will create asset bubbles in real estate,stock and currency.

For CIT Customers, An Uncertain Future Looms


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Financial Industry

FHA Digging Out After Loans Sour

Fed Keeps Key Rate at Record Low

VIX Volatility Gauge Soared 24%


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Dont Forget Unemployment

9.8 million workers are collecting unemployment.

Another 3.8 million are collecting emergencyunemployment benefits (a reference to unemployed

people who have been out of work for more than 26weeks).

5.2 million homeowners who are no longer payingtheir mortgages and contracting income.

Income is still contracting rapidly with wages andsalaries off 4% to 5% year over year.


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Actions of the Titans

Warren Buffet made the biggest bet of hiscareer, agreeing to buy Burlington Northern ina $26.3 billion deal that reflects his long-termoptimism about the U.S. economy.

Wilbur Ross Predicts Commercial Real EstateCrash


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Recent Transactions Closed


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Recent Transactions Closed


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Firms in Letter Of Intent (LOI)

Vertical market Financial Services

Mobile search applications

Vertical market

Healthcare (SaaS) Network security solutions

IT Services

Mobile messaging solutions


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Current Offers

Network management solutions

Vertical market- Wholesale Distribution

Application development tools Enterprise Content Management

CRM

Vertical market Insurance

Enterprise Application Integration


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Dougan is the head of Corums research team serving as the Director of Research. Duringhis time with Corum, Dougan spent three years working with Corum's international groupheadquartered in Zrich, Switzerland. Prior to joining Corum's team in 2005, Dougan spentthree years working in the banking industry with Bank of America, and Citigroup's Private

Wealth business unit. Before entering finance and investment banking, Dougan founded thesuccessful garment distribution business, Billions Apparel and the advertising firm, ModoMarketing. Dougan has a Bachelors degree in Business Economics from the University ofSan Diego.

Dougan MilneDirector of Research

Corum Group Ltd.

Market Valuation Analysis


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Public Markets

40.00

50.00

60.00

70.00

80.00

90.00

100.00

110.00

120.00

Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09

Nasdaq S&P Tech Dow


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M&A Activity September

Number of Software and IT M&A Transactions

2004

2005

329

311

225

286

0 50 100 150 200 250 300 350

O

2009 2008 2007 2006 2005 2004


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Horizontal Application Software Market

Public Valuations Deal Spotlight:

Sector: PLMTarget: IBM PLM Software AssetsBuyer: Dassault SystmesDate: October 2009

Transaction Value: $600 millionStructure: Cash

Comments:

Market share Technology Expanded product portfolio

Feb 09 Mar-09 Apr-09 May-09 Jun-09 Ju

-09 Au

-09 Sep-09 Oct-09

EV/EBITDA 5.85 x 6.82 x 9.23 x 9.39 x 9.99 x 11.06 x 11.06 x 12.67 x 12.26 xEV/S 1.12 x 1.12 x 1.16 x 1.35 x 1.50 x 1.58 x 1.93 x 2.41 x 2.21 x

Horizontal

Application

Software


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Public Valuations

Vertical Application Software Market

Deal Spotlight:

Sector: InsuranceTarget: Risk Management Solutions Weather derivatives softwarefranchise

Buyer: MDA FederalDate: October 2009Transaction Value: n/a

Comments:

Gains weather-related risk tech Expands product portfolio Client base

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Public Valuations

Consumer Application Software Market

Deal Spotlight:

Sector: Consumer HealthTarget: Vasectomy.com,HealthNews.org,BusinessFinance.com,

TheNewParentGuide.comBuyer: Internet BrandsDate: September 2009Transaction Value: $6.7mStructure: unknown

Comments:

Several online consumer sites

Broadened portfolio and customerbase Now operating in sevenhigh-interest consumer categories

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Applica ion

Sofware


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Infrastructure Market


Sector: VirtualizationTarget: Gresham Enterprise Storage- Storage Director BusinessBuyer: Tributary Systems

Date: October 2009Transaction Value: n/aStructure: n/a

Comments:

Complements product line Includes offering to IBM, Windows,Linux, Unix users

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Internet Market


Sector: e-CommerceTarget: Retail Convergence Ru La La, SmartBargains.comBuyer: GSI Commerce

Date: October 2009Transaction Value: $180 millionSellers Revenue: $134.6 millionTransaction Multiple: 1.3xStructure: $90 cash, $90 stock+ additional earnout

Comments:

Multi-interest consumer strategy Market leading brands Interactive marketing abilities

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ernet


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IT Services Market


Sector: IT ServicesTarget: Bearing PointChinese Services DivisionBuyer: Dell/Perot

Date: October 2009Transaction Value: N/A

Comments:

Geographic expansion Off-shoring Domain expertise

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Why Now?

Great Timing

Whos In?

Everyone: Small

Large firms

What For?

Cash Cow / Discontinued Tech.

Focus / Re-focus

Streamlining / Fat Cutting

Cash & Growth

Prepare for Exit

Asset Sales


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Charles Rim is currently Principal in the Corporate Development Team at Google, Inc.heading Asia coverage. CorpDev is responsible for all forms of strategic investments andacquisitions at Google. Previously, Mr. Rim was a Director at Yahoo!Korea in charge ofStrategy& Corporate Development, and prior to that stint was the VP/CFO of Korea Thrunet(formerly NASDAQ-listed, now merged with Hanaro Telecom), Korea's first broadbandcarrier.

In addition to his corporate career in finance and investments, Mr. Rim was an investmentbanker briefly with Citigroup and with Credit Agricole (W.I.Carr Securities) in Asia, withpostings in HK, Jakarta and Singapore. As an investment banker, the main focus ofactivities was in M&A, IPO advisory and equity capital markets financing. Previous to hisbanking career, Mr. Rim was a practicing attorney (again, focused on securities and M&A)both in the USA and Korea.

Charles RimCorporate DevelopmentGoogle

The Google Perspective


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Corum Group Presentation 27London November 17


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Partial Speaker List

Frank Boenke

Wellington Partners

Bernard Dalle

Index Ventures

Andrew Tsao

Silicon Valley BankKristof de Spiegeleer

SUN (Q-Layer)

Pelle Hjortblad

ProjectPlace

Anil Hansjee

Google

Jenny Rosberg

NASDAQ

Mike Peplow

Banctec

Ashley Ward

European LeadershipProgramme

Gustavo Garcia

BuyVIP

November 17, [email protected]


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www.worldfinancialsymposiums.com

Growth and Exit Strategies

Staging for Recovery

The Future ofM&A, VC, Private Equity andPublic Offerings in the NewTech Landscape

November 17, 2009 London

December 15, 2009 NewYork

Attend this conference to learn about:

Raising capital in the current environment

The new rules of global tech M&A

The role of private equity in a credit-starved market

The IPO window

Creative transaction structures

Finding value and opportunity in the cloud

Acquisition multiples, VC tactics and more


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Upcoming Corum Events

November 3: HoustonSUSO

November 5: Flash Webinar(Intl)

November 10: Flash Webinar(France)

November 11: Flash Webinar(DACH)

November 17: London WFS

November 18: Ft. LauderdaleMB

November 19: Tampa MB

December 3: Flash Webinar (Intl)

December 8: London SUSO

December 10: Flash Webinar(Nordic)

Merge Briefing (MB)Selling Up Selling Out (SUSO)World Financial Symposium (WFS)

December 15: New York City WFS

January 7: Flash Webinar (Intl)

January 12: Toronto MB & SUSO

January 14: Flash Webinar(France)

January 14: Ottawa MB

January 15: Montreal MB

January 19: Calgary MB

January 21: Flash Webinar (Nordic)

January 25-27:Miami Progress Conference

January 28: Flash Webinar(DACH)


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Contact Information

Research and Conferences:www.corumgroup.com

Corum Group Ltd.

Bruce Milne, [email protected]

Dougan Milne, Director [email protected]

10500 NE 8th Street, Suite 1500

Bellevue, WA 98004

USA

+1 425-455-8281

Corum Group International S..r.l.

Beim Paradeplatz

Basteiplatz 7

8001 Zrich

Switzerland

+41 44 251 82 65

MA Flash Report November 2009 Final

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Transcript of MA Flash Report November 2009 Final