Oracle News Desk
Software Industry 2009 M&A Trends Show Rising Multiples
Software Industry M&A activity experienced a significant half-to-half gain as exhibited by the 83% increase
By: Fuat Kircaali
Jan. 8, 2010 12:30 PM
Berkery Noyes on Friday released its "2009 Software Industry Merger & Acquisition Trends" report.
According to the report, Software Industry M&A activity experienced a significant half-to-half gain as exhibited by the 83% increase in the median EV/revenue multiple from 1.2 in 1st Half 2009 to 2.2 in 2nd Half 2009.
This rise brings the median EV/revenue multiple back to its 2007 level.
2nd Half 2009 exhibited a moderate increase in both aggregate volume and aggregate value, versus 1st Half 2009. Half-to-half, aggregate value increased by 17% from approximately $18 billion to $21 billion, and aggregate volume increased by 5% from 341 deals to 358.
Year-to-year 2009 exhibited negative growth in both aggregate value and aggregate volume of transactions.
Total transaction volume declined by 16% from 837 deals in 2008 to 699 in 2009.
Aggregate value declined by 16% as well, from $45.43 billion in 2008 to $38.30 in 2009.
Financially sponsored acquisitions took a decreased market share of deal activity, as measured by aggregate value, having had 23% in 2008 and 14% in 2009, a decrease of 37%.
The largest transaction in the Software Industry was Oracle's proposed acquisition of Sun Microsystems, announced April 19, for $7.1 billion.
The aforementioned transaction is more than 2.4x the next largest transaction, Fidelity National Information Services' acquisition of Metavante for $2.9 billion, which closed on October 1.
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