Tech M&A Monthly: 2018 Midyear Valuations, Deals & Trends Report

Timothy Goddard

Good morning, afternoon or evening wherever you happen to be in the world. Very happy to welcome you to Corum Group's first-half report on Tech M&A in 2018. I've got a few other things to get to as well though, so let's take a look at that. We have an economic outlook update from our founder and CEO, Bruce Milne, a field report on a deal recently closed and I'll have some words to say about some other deals, recently closed.

Then, we'll dive into our first half research report going into valuation metrics, megadeals and all the rest. And hopefully, we have some time for Q&A, so if you do have any questions that come up, please use the window on the oblivious right-hand side of your screen, and we will get to them, either during the Q&A session at the end or via email afterward.

But for now, lot's going on in the world and some people are very concerned about it, what does it mean for M&A, all that. And our founder and CEO, Bruce Milne has some thoughts, Bruce.

 

Bruce Milne

 There's a great deal of uncertainty and stress these days about the direction of the economy and what will happen to Tech M&A. The polarity on issues certainly doesn't help, it clouds the truth. Over the July 4th holiday, I was in a neighborhood barbecue.

My host pulled me aside, asked me, what do I think about the coming downturn and crash in the stock market. I said, "What crash?"

She talked about all the problems from child border issues to trade war, North Korea, midterm elections, Russia, capped by a Supreme Court fight, all tearing the country apart. Her language was peppered with words like Armageddon and chaos. She got pretty emotional. She said that in no way, this all couldn't be leading to collapse, and wasn't I just as worried to death like she was. I said, "No."

She was very emotional, she said to me, "Don't you care?" And I said, "Sure I care," but that everyday politics and drama and disasters which we have a front-row seat to, every minute of our lives is just noise. It has little to do with supply and demand, the basic economic engine and that engine is roaring. Just try to get a flight or hotel room.

Still having doubts, trying to convince me that I should be worried, she picked up a real estate flier off her counter. It talked about the coming softness in the market because sales are slowed. I told her, the writer had misinterpreted the data as there wasn't enough inventory. And the few houses in the market nearby were overpriced. Basically, the writer was ill-informed. And there are really, way too many like him posing as experts, trying to impose their views on us about everything. We went on like that for a while.

She finally calmed down and asked me, "What did I pay attention to, to understand where we're going?" I told her that at a high level, I watch the smart money, what they're doing. And at the street level, I pay attention to what the buyers and sellers are telling us at our live events. Private equity investors are raising record funds, doing record megadeals, shortening the mergers cycle, paying more, which indicates serious confidence in the future.

Summer is supposed to be the doldrums for conferences, yet we're having record sign-ups for our merge briefing and selling out seminars in Europe, Asia, and the United States, another sign of confidence in the future. We wrapped up our conversation talking about the effect of worrying. She agreed that she wasn't getting enough sleep and needed to spend less time on social media to lower her stress, to go and to walk her dog more.

I invited her to my hot hatha yoga class. She knows she needs to work on her breathing technique, just remembering to breathe. That's true for all of us. We just need to breathe, drop our heart rate, get rid of the monkey brain the yoga instructors talk about. When you do, and your mind is calm, it's clear that we are at an unprecedented time of global economic activity and opportunity. Firms that were not able to get the value they wanted even 18 months ago are going back to market, seeing higher values, multiple offers. There's never been a better time to calibrate the Tech M&A market.

 

Timothy Goddard

Thank you, Bruce, and on that note, I'd like now to go to our managing director of Corum Group International in Amsterdam with a deal report, Jon.

 

Jon Scott

On June 27th, our Netherlands-based client, Every Angle Software Solutions was acquired by Austin Texas-based, Magnitude Software. My Corum colleague, Allan Wilson out of our Austin office and I led the engagement. We want to congratulate Fred Herman, the Every Angle CEO, and his entire team on the transaction.

Every Angle is a software provider enabling users of SAP run organizations to optimize their operational performance by providing, insightful and easy to generate business analytics. Their key differentiator is their focus on providing this as a self-service solution for managers and they hide the complexity of SAP's data structure allowing these end users to quickly identify and resolve key business issues, and to do this, well before they have a negative impact on the business.

Magnitude's focus is to simplify complex application landscapes to help their customers realize productivity gains by unlocking the value promised by these enterprise platforms like SAP. Every Angle shares a similar mission so the strategic fit between the companies was significant.

Magnitude's acquisition was definitely strategic as I just explained. However, there is a portfolio of Audax partners, a major multi-billion dollar, Boston-based, private equity firm. What private equity firms do, is to help identify, model, vet, finance and finding bolt-on companies to their portfolio companies. They do this because they realize acquisitions can quickly add value to their companies and lessen the risk of only organically developing new products.

Finally, with a typical five- to seven-year holding period, they can really boost their near-term values. To prove this point, Every Angle was the third acquisition of Magnitude's in the last eight months and the seventh in total. Tim, back to you.

 

Timothy Goddard

Thanks, Jon, congratulations on another great deal.

Now, I'd like to talk about some things that we can't talk about. If you've been attending these webcasts over the last few years then you know that like Jon alluded to, the biggest single story in Tech M&A over that time, has been the rise of private equity buyers, and Jon's gone into some of the reasons.

They've gone from a small portion of the market to possibly, the most important bio sector in the industry. I read an article just last week in The Wall Street Journal that profiled this equity, which has been the number one acquirer of software companies globally over the last few years, period. That's more than any of the tech giants like Microsoft or Google, more than consolidators like Consolation or J2.

While they're the most active PE players, there are hundreds of others, like Jon referenced Audax, and you're gonna hear about a lot more of them during the research report coming up. But this rise of private equity has had some interesting secondary consequences, and one of those is, an increase in the number of secret deals we've been seeing, that's my own, maybe a melodramatic term, for deals that aren't being disclosed, sometimes ever.

An increasing number of buyers, primarily these private equity firms, are either delaying or never announcing the deals that they do. Given the intense competition between PE firms and between them and the strategic buyers, it's not shocking that some wanna keep their plans and strategies close to the vest when they can. And as private companies, most PEs are more able to do this than traditional public strategic buyers. We've closed here at Corum, a number of deals recently where a disclosure has either been delayed or it's been skipped entirely.

Deals in big data, storage, construction, software education and more. Sometimes, as with our recent sale of the autism healthcare SaaS vendor code metro, we are able to announce the deal but without disclosing the acquirer. What's the takeaway for execs on the call today, who are trying to understand the Tech M&A market better?

First, be aware, there's a lot going on under the surface. There are companies getting funded, being acquired that you may never hear about, but you'll see the impact in your market. The numbers our research team will go over in a bit here will only talk about those deals that have been made public and that means things are actually even more active than they appear from the surface.

Also, it means that when you go to market, you wanna work with someone who has enough deal flow to have a view into these secret deals. Because of the deals that we do that aren't disclosed, we have access to buyer preferences, valuation metrics and other information that no one else does, and that's a real advantage during the whole M&A process, but especially when we're negotiating on our client's behalf.

If you wanna understand more about this process, please just reach out, via our website or even use that chat window I mentioned earlier and we can see about setting up a call. With that, there are still plenty of deals and valuations that have been disclosed, so let's hear more about those from our research team, led by Elon Gasper, joined by Amber Stoner, Yasmin Khodamoradi, Amanda Tallman, Patrick Cunningham and Becky Hill. You on?

 

Research Report

Elon Gasper

Thanks, Tim. We begin with the public markets where major indices climbed to new highs during the first half, ending up with the tech-heavy NASDAQ and the S&P Tech up nine and 18%, respectively, though the Dow lost all its gains and then some, down 2%. Asia markets were generally lower amid trade tensions, China particularly, and Europe mixed, the German DAX with a 5% drop. The long bull market narrative has diverged as tech races on ahead of traditional businesses worldwide. We'll see when and if the gap closes, whether it's another chapter in this bull market story or part of a more secular change. In the meantime, the tech boom continues, with Tech M&A still seeing fierce, though disciplined demand as those traditional buyers seek to avoid obsolescence and tap the growth and value drivers, those soaring tech companies provide.

But there's a shortage of small tech companies for sale, so our Corum Index shows Tech M&A deal volume, little changed, but with a record number of megadeals, as buyers head upmarket. Private equity continued to take share from strategics, and VCs due to fade back from exits. But those megadeals, wow! They're setting the stage for more M&A demand since buyers will be looking for smaller companies to tuck in around their new purchases, competitors will be spurred into matching investments in inorganic growth, and mid-sized players face fears of consolidation waves eroding their market positions and profits. These effects will work together, making now a great time to check if an exit window is opening for your company. With that in mind, let's sample a few of those megadeals, Yasmin?

 

Yasmin Khodamoradi

Planning SaaS provider, Adaptive Insights, was taken off the IPO market by Workday in their biggest transaction to date, paying $1.6B at over 13 times revenue.

 

Elon Gasper

Microsoft shelled out $7.5B for collaborative code platform, GitHub in Redmond's third-biggest deal ever, returning to its roots in developer tools.

 

Yasmin Khodamoradi

Siris Capital paid two billion for domain registration and hosting services provider Web.com, hoping that going private will allow them to make the necessary investments to fend off pressure in an increasingly competitive space.

 

Elon Gasper

Job listings and workplace reviews platform, Glassdoor, stacked up for $1.2B at seven times revenue by Japan's Recruit Holdings, atop its prior acquisitions of job sites, SimplyHired and Indeed.

 

Yasmin Khodamoradi

ZPG, the British company behind property websites, Zoopla and PrimeLocation, was bought for $3B at nearly 9x sales by Silver Lake, possibly setting the stage for further bolt-on acquisitions.

 

Elon Gasper

And Sky Betting was raked in for $4.7B by PokerStars owner, Stars Group, claiming it creates the world's largest public online gaming company, and just as the US Supreme Court loosened gambling restrictions here.

Looking now, at a three-year span by quarter, sales-based valuations converged sharply for the core B2B sectors, Horizontal, Vertical and Infrastructure, the others dropping, with Internet back to fourth place above Consumer. IT Services remained lowest as multiples in the developed markets dipped, reflecting the tight US job market. EBITDA metrics mostly diverged last quarter, many recovering from Q1's drop, with proven, profitable business models commanding more value again except for those IT Services and the volatile, hit-driven Consumer plays. Going now from values to buyers, the midyear leaderboard, please.

 

Yasmin Khodamoradi

Our top acquirer leaderboard keeps shifting, though Constellation Software is on top again, increasing its pace with 21 acquisitions. And a burst of new deals has lifted Microsoft to the number two spot, with 12 deals in the first half of 2018, equaling their deal count for all of 2017. Diving deeper into the leaderboard, three groups, in particular, stand out. Our 2017 leader, Constellation, heads a pack of consolidators that includes one newcomer to our Leaderboard, Coinbase. All are rolling up small to mid-sized tech firms as a key strategy. Another group consists of services companies buying up both tech and talent to expand markets and keep up with disruptive trends. Dentsu leads with nine deals, while newcomer Konica Minolta, acquired six companies in its quest to become a leading IT services provider. And finally, among the four tech giants on the board, Alibaba increased its pace while Alphabet stepped back, or was rather forced back, as Microsoft took the second slot on our leaderboard.

 

Elon Gasper

Reportedly, by outbidding Alphabet on at least one of Microsoft's dozen deals which fall into five groups. A pair of edtech startups with strategic value for Teams, two enterprise cloud, and file storage-related companies, priming a new game studio with five little Xbox outfits, enabling AI tech with another couple deals, and last but not least, the GitHub deal. Note how they all relate to broader and sometimes, previously hidden strategies. It's important in M&A to present but not presume what aspect of your company may turn out to be its real buyer motivator.

Next, we tour our six sectors including trends, key transactions and quarterly value changes among their 30 subsectors, starting with Horizontal Applications, Amber?

 

Amber Stoner

Sales and EBITDA multiples remained remarkably stable through most of Q2 with sales multiples reaching 12-month highs in May. The HR and CRM subsectors retained their top spots in both sales and EBITDA metrics, both metrics increased for the Marketing, SCM and Payments subsectors which also recorded a number of deals in the first half, driven by our top 10 tech trends, especially AI Enablement and Digital Currency Flow, among others.

Programmatic ad exchange AppNexus was sold for $1.6B to AT&T, as it plans to build a marketplace for TV and digital video advertising, similar to Verizon's plans for its Oath subsidiary. As a part of our Data Science Monetization trend, influencer marketing startup, Reelio, was picked up by Web analytics and brand management firm, Fullscreen to complement its lineup for both the brand and creative sides of online video influencing. Pulpix, which makes AI-enabled, video personalization technology for publishers, was acquired by French native ad company, ADYOULIKE, to diversify its video supply. And London-based sentiment analysis company, TheySay, was bought by Vista Equity-backed Aptean for TheySay's advanced computational linguistics tech.

Our Digital Currency Flow trend drove payment deals as well. In the transaction processing space, CloudCraze was bought by Salesforce adding B2B ecommerce capabilities to its existing B2C ecommerce offerings picked up in the 2016 acquisition of Demandware. iMobile3, which develops point-of-sale payments solutions for small businesses, was acquired by payments veteran TSYS, to extend its SMB reach. Virginia-based FrontStream, a maker of payment processing solutions for non-profit fundraising, was acquired by Marlin Equity. And point-of-sale software developer, Index was picked up by online payments firm, Stripe. And PayPal spent $2.2B for Sweden's digital payments firm, iZettle, to strengthen its presence in Europe and Latin America.

PayPal followed another of our trends, AI Enablement, buying machine learning-powered prediction platform developer, Jetlore, which should advance PayPal's marketing solutions beyond the online checkout experience. In the supply chain management space, former Corum client, Oniqua, specializing in Maintenance Repair and Operations for asset-intensive industries, and sold to oil & gas company, ASCO back in 2012, found a new home at IBM to bolster its in-house, industrial Internet of Things offering. Oniqua's tactics, adhering to its core vertical, led it to a win-win deal with the tech giant, which should introduce Oniqua to a range of horizontal applications.

Other SCM deals included supply chain risk management firm, Avetta, being picked up by a PE firm, and product lifecycle management firm, FSEnet+ was acquired by Wicks Group-owned, Gladson.

Finally, in the business intelligence space, AI-enabled relationship intelligence provider, Accompany was bought for $270M by Cisco in a move that could put it in direct competition with Microsoft's LinkedIn. Toronto-based Angoss, applying machine learning for customer segmentation and fraud detection, was acquired for over $24M by data intelligence pioneer, Datawatch. And revenue intelligence firm, BrightFunnel was picked up by account-based marketing expert, Terminus to gain analytics insights for its account-based orchestration offerings. What's happening in the Vertical space?

 

Yasmin Khodamoradi

Vertical sales multiples have trended up since their dip in April, while EBITDA metrics surpassed their January peak. Most subsectors remained steady, with healthcare seeing moderate increases in sales and EBITDA metrics. However, multiples in the A/E/C space broke yet another record, nearing nine times sales.

In healthcare, we saw a number of deals in patient engagement, a cornerstone of the Connected Health trend, including patient communication app maker, HealthGrid, which was nabbed for $60M with up to $50M in earnout by Allscripts to strengthen its own patient engagement platform. We also saw a series of deals in narrow healthcare specialties, including some of Corum's own clients, like Codemetro, which delivers practice management solutions for autism therapy providers, and was sold to a strategic investor. And Infian, a provider of EHR systems for dialysis therapy firms, was sold to Constellation's Quantitative Medical Systems, highlighting our top acquirer's tendency to grow mission-critical domains via bolt-ons.

The life sciences space was also active, as SHYFT Analytics, which develops a cloud analytics platform for pharma and biotech players, was purchased for $195M at nearly eight times revenue by Medidata. SCIO Health Analytics, which provides BI and predictive analytics SaaS for healthcare and life sciences organizations, was picked up for $240M by operations management firm, EXL. Core Informatics, which offers laboratory information management systems, was picked up by Thermo Fisher for nearly $95M at over nine times revenue. And in Switzerland, Corum client, Genohm, known for its laboratory software automation suite, was sold to life sciences giant, Agilent Technologies.

In the A/E/C space, Utah-based, construction takeoff estimating firm and former Corum client, PlanSwift was bought by ConstructConnect. And Corum client, Stabiplan, was sold to Trimble for its innovative building information management and simulation software.

In the financial subsector, we saw several deals highlighting our AI-enablement and RegTech trends. HeavyWater, a developer of AI-enabled, mortgage lending systems, was bought by loan lifecycle company, Black Knight. And Armanta, which enables financial services firms to aggregate data across multiple systems in real time, was scooped up by IBM to strengthen its Watson Financial Services division. Sageworks, which provides a platform for assessing risks on loans for banks and credit unions, was picked up by Accel-KKR, which also bolted on loan risk allowance firm, MainStreet Technologies to its compliance solutions portfolio company, Banker's Toolbox. And Corum client, Lending Manager, which runs a platform to manage loan officer websites, was acquired by LoyaltyExpress to enhance its CRM stack for banks and mortgage companies.

Finally, one of our top acquirers, Hexagon, acquired turn-key AV platform developer, AutonomouStuff, to accelerate its autonomous vehicle strategy. Hexagon also made a move into the "smart factory" space by picking up France-based, SPRING Technologies, a pioneer in Computer Numerical Control for machine tools. How did the consumer sector do, Patrick?

 

Patrick Cunningham

 In the Consumer market, valuations remain volatile, with a slight drop in sales and an uptick in EBITDA multiples. Despite the decline in sales multiples after the peak in March, the stream of deals continues, especially in video games.

Seattle-based studio, Harebrained Schemes was acquired for $7.5M by Swedish publisher, Paradox Interactive, following the successful release of the jointly developed, BattleTech game. In France, 1492 Studio, specializing in narrative romance mobile games, was picked up by Ubisoft to reach new audiences. During E3, Microsoft announced the acquisition of four game studios at once, Undead Labs, Ninja Theory, Playground Games, and Compulsion Games. On top of its acquisition of Playfab back in January, Microsoft has almost doubled its in-house studios and aims to improve the current state of Xbox exclusives through a new studio called, the Initiative.

Soon after the US Supreme Court decision that opened the door for the legalization of sports gambling, former unicorn, FanDuel was acquired for $158M by Irish bookmaker, Paddy Power Betfair, which seeks to leverage the popular daily betting site in the coming new environment. Content provider and aggregator, Gameiom Technologies was acquired for $5M by Las Vegas-based, gaming systems supplier, AGS to launch its iGaming division. Sports betting company, Nordbet was grabbed by Malta-based, Gaming Innovation Group for access into the northernmost state of Germany. Indian mobile payments startup, Chillr was purchased by Scandinavian caller ID app, TrueCaller. And secure payment app, DISC Holdings was picked up by cybersecurity provider, Rivetz for its blockchain technology.

In the entertainment space streaming services for producers, Pulselocker, was acquired by Beatport to boost its own streaming services offering by providing the offline access to its music library. Streaming company, Qello Concerts was bought for $12M by music service, Stingray to expand its live offerings with on-demand concerts.

 

Amber Stoner

Overall sales multiples in the Infrastructure sector dipped slightly to end Q2, while EBITDA multiples increased from Q1, though not quite back to the beginning of the year. Subsectors saw increases in both metrics, with the exception of Endpoint where sales multiples held steady, while EBITDA multiples dipped.

We tracked deals across nearly all subsectors as well, in the first half of the year, starting with network and app performance management. LogicMonitor, which monitors hybrid environments, was acquired by Vista Equity. As Vista keeps up with its 2017 acquisition pace and bolt-on strategy, we expect to see additional acquisitions for the LogicMonitor platform in the coming months. Savvius, which provisions network performance visibility and packet inspection, teamed up with IT network management firm, LiveAction which continues its strategic moves in the network performance monitoring and diagnostics market. App performance management SaaS provider, AppNeta was bought by PE firm, Rubicon Technology Partners. And Netsil, which develops tech for discovery and mapping of microservices in distributed cloud environments, was picked up for $70M by virtualization specialist, Nutanix in response to the growing demand for fixing misbehaving containerized applications.

Our Data Security trend drove deals where NSA-linked threat hunting startup, Sqrrl was acquired by AWS. With AWS now doing its own M&A with a focused team, we expect to see more acquisitions from it in the coming months. Ping Identity made its second acquisition after becoming a Vista Equity portfolio company, as the firm bought API security startup, Elastic Beam for its AI-based tech to lay the foundation for its PingIntelligence for APIs product.

In the Identity management space, access management firm, Lieberman Software was bought by Thoma Bravo-backed, secure access developer, Bomgar, which was sold to Francisco Partners a couple months later. On the endpoint security side, Smyte, using AI to alleviate harassment and spam on social media, was snatched up by Twitter after its nearly two-year pause in M&A. Threat management firm, VIPRE, formerly known as ThreatTrack, was acquired by J2 Global, to complement email protection company FuseMail. And Israeli endpoint security automation startup, Secdo was bought for $100M by Palo Alto Networks to strengthen its detection and response inventory. Palo Alto also spent $300M for Evident.io, which resolves security compliance issues with AWS and Azure, in a deal where the RegTech and Data Security trends came together.

And in another appeal to DevOps teams, incident management firm, VictorOps was acquired for $120M by Splunk, to combine event management, monitoring, and on-call management. Among deals in the data backup and recovery space, Ireland-based, CloudRanger, a provider of AWS-focused agentless backup SaaS solutions, was bought by a software-defined storage company, Druva.

Open source disaster recovery solutions developer, Zmanda was picked up by product engineering services provider, BETSOL to complement its Rebit lineup for SMB markets. Application and data integration software provider, Mulesoft was acquired for $6.5B by Salesforce, which intends to use Mulesoft's rich data layers to build upon its Einstein AI project.

Finally, IT service management company, Cherwell was acquired for $172M by KKR following its $50M investment a year ago. How has the Internet sector performed in Q2, Amanda?

 

Amanda Tallman

After internet business model fears from the first quarter abated, valuation metrics have been reverting, with EBITDA dropping from March highs and sales increasing from March lows. That movement held true across the subsectors.

As predicted in our January webcast, Amazon did enter healthcare through M&A, outbidding Walmart for PillPack, and giving them instant large-scale entry into the pharmacy space, much to the disappointment of their brick and mortar counterparts. In the food delivery space, we saw deals aligning with our composite commerce trend as Supermarket operator, Kroger, spent $200M for meal-kit delivery company, Home Chef, following similar moves by Walmart and Target, as the industry responds to last years Amazon shakeup. Regional chain, H-E-B Grocery, gobbled up Austin's Favor Delivery to expand its service offerings within its Texas and Mexico locations. Germany's HelloFresh went international, picking up Organic meal kit startup, Green Chef, as it competes with Blue Apron in the U.S. In its first-ever acquisition, UberEATS swallowed up Ando, a delivery-only lunch startup, and later, restaurant tech company, orderTalk, to integrate its point-of-sale system. And Landcadia Holdings, a public company formed for acquisitions by investors from the hospitality and financial sectors, paid over $300M, mostly in stock, for Louisiana-based delivery startup, Waitr.

In the travel market, Vitruvian Partners picked up UK-based, Travel Counsellors from Equistone Partners for over $330M, adding its platform for self-employed travel agents. Canadian accommodation auction site, BackBid was purchased by group travel specialist HotelPlanner.com, to grow its presence in the individual travel market. AI startup, TripHappy was acquired by Expedia's hotel metasearch platform, Trivago, to improve its personalized search capabilities. And in the UK, online travel agency, Loveholidays was bought by PE firm, Livingbridge in its largest deal ever.

The online community space saw a wave of consolidation over the last few months. Coupon and deal-sharing platform, Slickdeals, was acquired by the PE arm of Goldman Sachs along with Hearst, in a move valued at over $500M. Merchandise logistics startup, Kit was picked up by Patreon, a company offering patron memberships for artists and creators, adding more automation to their merchandise selling capabilities.

Verizon continues to sell off pieces of its Oath division, as Flickr, previously a part of Yahoo, was snapped up by SmugMug, to create the world's largest photographer community. And online DIY Community, Fixya, was purchased by media company, VerticalScope, to expand its portfolio of enthusiast communities.

In the dating space, Tinder's parent company, Match Group swiped right on Hinge, an app tailored towards relationships, expanding its portfolio in the wake of Facebook's plan to create its own dating app. And Finally, we saw consolidation between two popular Chinese dating apps, as Tantan was acquired by Momo, for over $700M. What happened in the IT Services market, Becky?

 

Beck Hill

Valuations for IT Services companies in developed markets dipped sharply for the first time in over a year, with usual differences between developed and emerging value metrics re-asserting themselves, while emerging market for valuations and corresponding increase.

BPO services targets in M&A varied greatly both in terms of applications and geographies. UK-based, IESA, which provides ERP and BPO services, was picked up for $118M by electronics distributor, Electrocomponents, to enhance and accelerate its value-added services. In Latvia, nearshore BPO firm, Runway was acquired by French customer care outsourcing company, Webhelp Group, which also purchased SellbyTel from Omnicom, all to increase its presence in Europe and to flesh out its B2B support portfolio. Chicago-based, SHIFT, which offers Communication Supply Chain Solutions, was acquired by Mudd Advertising to round out its direct marketing services and expand its client offerings in the automotive space.

Also in Chicago, management, and operational technology consultancy firm, C5MI was bought by SAP systems integrator, YASH Technologies to reinforce its position in the supply chain sector. The cybersecurity services space also saw a number of deals. UK firm, MWR InfoSecurity was bought for over $106M and nearly five times revenue by Finland's endpoint security veteran, F-Secure to strengthen its detection and response solutions.

Also in the UK, managed cybersecurity and GDPR consultancy, Agenci, was bought by Cyberfort to boost its data protection and compliance capabilities. And Skyport Systems, which develops hyperconverged infrastructure solutions, was acquired by Cisco to advance the networking giant's data center server security.

There were also a number of deals in the SAP systems integration space. In the UK, SAP Hybris e-commerce agency, Envoy Digital was picked up by German ERP consulting firm, KPS. In Germany, SAP-based CRM and e-commerce solutions developer, Sybit, was purchased by SAP HANA specialist, itelligence, to boost its presence in the DACH region. Automotive sales specialist with expertise in SAP, gen-ius, was bought by Japan's IT services giant NTT DATA, to expand its services for automotive dealers internationally. Virginia-based SAP Ariba systems integrator, Kash Solutions, was picked up by tech services company 10Pearls to add its focused services to 10pearls general capabilities. Finally, SAP-oriented IT services firm, Rizing, was sold to One Equity Partners, which then bolted on SAP SuccessFactors and Retail services specialist, Aasonn.

 

Elon Gasper

And now in Q3, the megadeal tsunami keeps crashing in. Overnight, big chipmaker, Broadcom, trying to pivot into infrastructure with a nearly $19B deal for industry veteran, CA. The buyer CEO, announcing a new ambition, to create one of the world's leading infrastructure technology companies with implications of additional deals in that space. We'll talk more about that megadeal next month. For now, a timely example of how this intense megadeal disruption will generate even more M&A demand, eh, Tim?

 

Timothy Goddard

That's right Elon and we will talk more about that next month. Thanks for those of you who have sent in questions, we are running a little out of, above time, so hopefully, we'll be able to follow up with you afterwards and see you at one of our live events, which we are going to be running as Bruce mentioned pretty heavily, through the summer. With that, let's go to our close.