Financial Technology, Data, and Analytics

Dear Clients and Friends,

As you will see from our report found below, the m&a values and trends in the dozen+ sectors of the information technology industry that we follow and sometimes lead have remained at the relatively high levels that we’ve been seeing since about late 2014. For some, the question has been: “When will it end?” For others: “Is this the right time to be a buyer – or a seller?” To this we have several responses.

First: Don’t trust the pundits. They were wrong on Brexit, wrong on Trump, and have no clue when this cycle will end; neither do we. But we do know that it will end. We have not yet conquered economic cycles. Don’t fool yourself.

Second: Don’t generalize. Some firms will do well in a tough economy; some won’t. Some market niches are just opening and have lots of room to grow; some niches are rapidly being overtaken by events, technology or consolidation and won’t be around much longer. In the words of General James Mattis, when he commanded Marine Corps forces in Iraq: “You cannot allow any of your people to avoid the brutal facts. If they start living in a dream world, it’s going to be bad.”

Third: Take control. Don’t be a victim. Successful deal making is about controlling the timing – not about luck. Whether you are a buyer or a seller, the timing of m&a decisions is in your hands. If you are serious about selling, take advantage of buyer interest and momentum. Don’t be passive. If you are serious about buying, look beyond recent past performance. Buying low and selling high is an easy-to-parrot mantra that few actually follow. Instead they wait too long to sell in strong markets; and they prevaricate buying in weaker ones. It’s clear that those who have clear goals; a clear plan to achieve those goals; and are willing to act decisively while those around them flail have better results than most others. Luck is not a plan.

Fourth: It’s all about the future. Value is driven by perceptions of your ability to drive future growth over the long term; not about past results. Focus on what it will take to make the company’s future bright. That’s where the money is…. The report that follows includes data on many of the most recent m&a deals, values and trends in the dozen+ sectors that we follow. Marlin & Associates advised on four of those transactions in the first two months of 2017 – call us if you want help on yours.

A few of the more interesting recent deals include:

• Gartner (NYSE:IT) acquired Corporate Executive Board (“CEB”) for $2.6bn in cash, valuing the company at an implied 3.5x LTM Revenue and 17x LTM EBITDA,
• QuoVadis agreed to sell a majority interest in the company to WISeKey, a leading Swiss cybersecurity and Internet of Things (IoT) company. Marlin & Associates acted as the exclusive financial and strategic advisor to QuoVadis and its principal owner, ABRY Partners,
• TMX Group (TSX:X) agreed to sell its extranet and wireless infrastructure business (“Atrium”) to the Intercontinental Exchange (NYSE: ICE). Marlin & Associates acted as the exclusive financial and strategic advisor to TMX,
• OpenGamma received a strategic investment from the Japan Exchange Group (“JPX”), Accel Partners, NEX (formerly known as ICAP), Euclid Opportunities and ex-SunGard CEO Cristóbal Conde. Marlin & Associates acted as the exclusive financial and strategic advisor to OpenGamma and its investors,
• Advise Technologies was acquired by Compliance Solution Strategies, a governance, risk management and compliance (“GRC”) platform backed by CIP Capital. Marlin & Associates acted as the exclusive financial and strategic advisor to Advise Technologies.

For a complete picture of deals, trends and values in the dozen + sectors that we follow, please see below.