Six-year growth streak for enterprise software M&A slows but peak valuations remain, says Hampleton Partners’ report
- Private equity buyers completed one-third of all enterprise software transactions in 2019, up from 25 percent in 2018
- Artificial intelligence, SaaS, and cloud companies attracted strategic buyers, including Apple, Adobe, Salesforce, Google and Microsoft
London, UK – 4 February 2020. The latest Enterprise Software M&A market report from Hampleton Partners, the international technology mergers and acquisitions advisor, reveals that transaction volumes decreased slightly to 620 deals inked in the second half of 2019, but revenue and EBITDA multiples remained astoundingly high at 4.0x and 17.3x respectively.
Miro Parizek, founder, Hampleton Partners, said:
“Despite the slight cooldown in deal volume, the overall picture indicates that we’re entering 2020 with continued strong demand for enterprise software assets. Private equity investors continue to harness readily available debt financing for acquisitions and have outbid strategic buyers in leveraged buyouts throughout 2019.
“The never-ending need for businesses to invest in IT, applications and specialist software has also encouraged rival tech giants like Google and Microsoft to increase their M&A activity in the sector, bumping them back up on the list of top enterprise software acquirers over the past 30 months.”
Microsoft made 12 acquisitions in the past 30 months, most recently Mover Inc, Movere Inc and JClarity Ltd – all SaaS companies which it will no doubt use to bulk up its Azure cloud platform. Google racked up 10 acquisitions in the enterprise software sector, with CloudSimple Inc (VMware infrastructure-as-a-service or IaaS), Elastifile (software-defined storage) and Looker(big data analytics SaaS) being most recent.
Largest disclosed deals of 2H2019 – All private equity buyers
- Francisco Partners/Evergreen Coast Capital’s acquisition of LogMeIn Inc – $4.2 billion.
- Thoma Bravo acquisition of Instructure Inc – $1.8 billion.
- Platinum Equity acquisition of Cision Ltd – $1.5 billion.
Note to Editors:
Hampleton Partners’ M&A Market Reports are compiled using data and information from the 451 Research database (www.451research.com).
Download the full Hampleton Partners’ Enterprise Software M&A Market Report 1H2020: https://www.hampletonpartners.com/reports/enterprise-software-report/
About Hampleton Partners
Hampleton Partners is at the forefront of international mergers and acquisitions and corporate finance advisory for companies with technology at their core. Hampleton’s experienced deal makers have built, bought and sold over 100 fast-growing tech businesses and provide hands-on expertise and unrivalled advice to tech entrepreneurs and companies which are looking to accelerate growth and maximise value.
With offices in London, Frankfurt, Stockholm and San Francisco, Hampleton offers a global perspective with sector expertise in: Artificial Intelligence, Autotech, Cybersecurity, Digital Commerce, Enterprise Software, Fintech, Healthtech, HR Tech, Insurtech and IT & Business Services.
For more information visit https://www.hampletonpartners.com.