European Technology, Media & Telecommunications Monitor Market and Industry Update Fourth Quarter 2012 Piper Jaffray European TMT Team: Eric Sanschagrin Managing Director Head of European TMT [email protected] +44 (0) 207 796 8420 Stefan Zinzen Principal [email protected] +44 (0) 207 796 8418 Jessica Harneyford Associate [email protected] +44 (0) 207 796 8416 Peter Shin Analyst [email protected] +44 (0) 207 796 8444 Julie Wright Executive Assistant [email protected] +44 (0) 207 796 8427 TECHNOLOGY, MEDIA &TELECOMMUNICATIONS MONITOR Market and Industry Update Selected Piper Jaffray 2012 TMT Transactions 2 This report may not be reproduced, redistributed or passed to any other person or published in whole or in part for any purpose without the written consent of Piper Jaffray. © 2013 Piper Jaffray Ltd. All rights reserved. TECHNOLOGY, MEDIA &TELECOMMUNICATIONS MONITOR Market and Industry Update Contents 1. Internet and Digital Media A. Trading Update B. Transaction Update C. Public Market Trading Multiples 2. Software and IT Services A. Trading Update B. Transaction Update C. Public Market Trading Multiples 3. Communications Technology And Hardware A. Trading Update B. Transaction Update C. Public Market Trading Multiples 4. Equity Capital Markets and M&A Update 3 This report may not be reproduced, redistributed or passed to any other person or published in whole or in part for any purpose without the written consent of Piper Jaffray. © 2013 Piper Jaffray Ltd. All rights reserved. TECHNOLOGY, MEDIA &TELECOMMUNICATIONS MONITOR Market and Industry Update 1 - Internet and Digital Media A - Trading Update Sub-sector performance – Last Three Months: Sub-sector performance – Last 12 Months: Sector 3M Sector LTM Other vertical marketplaces 20.6% Vertical marketplaces - Employment services 106.3% Online Content 16.2% Online Retail 44.1% Online Marketing / Advertising 10.9% Online Content 29.5% Online Gambling 3.9% Vertical marketplaces - Real Estate 23.9% Vertical marketplaces - Real Estate (1.6%) Online Marketing / Advertising 22.3% Online Retail (3.2%) Online Travel 20.4% Global Internet Leaders (6.2%) Online Gambling 16.7% Vertical marketplaces - Employment services (7.4%) Global Internet Leaders 7.5% Online Travel (7.7%) Chinese Internet Leaders (21.5%) Chinese Internet Leaders (12.6%) Other vertical marketplaces (53.4%) DJIA (3.4%) DJIA 5.5% NASDAQ Comp (5.5%) NASDAQ Comp 12.7% S&P 500 (2.7%) S&P 500 11.0% Note: Excludes IPOs for last 12 month comparisons (Facebook) Top 5 Price Performers – Last Three Months: Top 5 Price Performers – Last 12 Months: Company % change Company % change Netflix 60.5% 888 Holdings 183.6% Ehealth 52.1% Expedia 107.7% Overstock 34.5% Asos 105.2% Ctrip.com 28.4% AOL 98.5% 888 Holdings 26.8% Ehealth 97.2% Top 5 Price Underperformers – Last Three Months: Top 5 Price Underperformers – Last 12 Months: Company % change Company % change Velti (47.2%) Groupon (74.1%) Sina (29.4%) Zynga (73.7%) Monster Worldwide (26.9%) Webmd Health 'A' (61.0%) Travelzoo (19.3%) Tradedoubler (52.1%) Netease.com (19.0%) Orbitz (36.9%) Note: For composition of indices, see Public Market Trading Multiples section Source: Thomson Reuters 4 This report may not be reproduced, redistributed or passed to any other person or published in whole or in part for any purpose without the written consent of Piper Jaffray. © 2013 Piper Jaffray Ltd. All rights reserved. TECHNOLOGY, MEDIA &TELECOMMUNICATIONS MONITOR Market and Industry Update 1 - Internet and Digital Media B - Transaction Update Selected European ECM Transactions – Q4 2012 Offering Target Amount Offering Date Target Location ($MM) Deal Type Description Target Description 21-Dec-12 getgoods.de AG Germany 27 Follow-On Ordinary Shares Distributor of IT and telecommunication products 11-Dec-12 Yandex NV Russia 107 Follow-On Ordinary Shares Operates an Internet search engine in Russia 03-Dec-12 Quindell Portfolio PLC UK 27 Follow-On Ordinary Shares Provides software and consulting solutions 16-Nov-12 SmartGuy Group A/S Denmark 21 Follow-On Ordinary Shares Online retailer of consumer goods 02-Nov-12 Quindell Portfolio PLC UK 42 Follow-On Ordinary Shares Provides software and consulting services Number of Deals 5 Average Value ($MM) 45 Total Value ($MM) 224 Note: Offerings over $10 million where the issuer is headquartered in Europe Source: CapitalIQ, StrategyEye, company information, Thomson, company press releases 5 This report may not be reproduced, redistributed or passed to any other person or published in whole or in part for any purpose without the written consent of Piper Jaffray. © 2013 Piper Jaffray Ltd. All rights reserved. TECHNOLOGY, MEDIA &TELECOMMUNICATIONS MONITOR Market and Industry Update 1 - Internet and Digital Media B - Transaction Update Selected European M&A Transactions – Q4 2012 Deal Trans. Multiples Target Acquirer Value EV / EV / Date Target Location Acquirer Location ($MM) Sales EBITDA Target Description Publisher of traditional press 21-Nov-12 Northcliffe Media Ltd UK Local World Ltd UK 84 NA NA newspapers and digital media Advanced Inflight Alliance Global Eagle Acquisition Provides inflight entertainment 08-Nov-12 Germany US 142 0.9x 12.7x AG Corp services Axel Springer Classfields Provides information retrieval services 06-Nov-12 Immoweb SA Belgium Germany 163 8.2x NA GmbH regarding real estate Provides Internet search engine 24-Oct-12 Qype GmbH Germany Yelp Inc US 50 NA NA services Provides digital IR and corporate 01-Oct-12 Investis Ltd UK Gresham Private Equity UK 40 NA NA communication solutions Median 4.6x 12.7x Mean 4.6x 12.7x Number of Deals 5 Average Value ($MM) 96 Total Value ($MM) 480 Note: M&A transactions over $40 million where either party is headquartered in Europe Source: CapitalIQ, StrategyEye, company information, Thomson, company press releases 6 This report may not be reproduced, redistributed or passed to any other person or published in whole or in part for any purpose without the written consent of Piper Jaffray. © 2013 Piper Jaffray Ltd. All rights reserved. TECHNOLOGY, MEDIA &TELECOMMUNICATIONS MONITOR Market and Industry Update 1 - Internet and Digital Media B - Transaction Update Selected European Private Equity and Venture Capital Activity – Q4 2012 Deal Target Value Date Target Location ($MM) Investor(s) Target Description 20-Dec-12 Avito.ru Russia 50 Undisclosed new investor Online advertising website 12-Dec-12 Trustpilot A/S Denmark 13 Index Ventures Provides a portal for online customer reviews Northzone Ventures SEED Capital Denmark 03-Dec-12 DocPlanner Poland 10 Point Nine Capital Operates online portal that helps users find local Piton Capital physicians and dentists RTAventures VC sp. z o.o. 21-Nov-12 Local World Limited UK 23 Trinity Mirror plc Publishes print and digital newspapers 08-Nov-12 Elasticsearch NL Netherlands 10 Benchmark Capital Develops distributed search engine solutions for Data Collective websites and other online systems 07-Nov-12 MediaSift Ltd. UK 15 Scale Venture Partners Develops social media tools and platforms GRP Partners Northgate Capital Group, L.L.C. IA Ventures Daher Capital 18-Oct-12 7digital Limited UK 10 Undisclosed (two public Provides online download stores for digital media technology companies) 09-Oct-12 HouseTrip SA Switzerland 40 Accel Management Co, Inc Operates a holiday property rental website Index Ventures Balderton Capital 06-Oct-12 Deezer.com France 131 Access Industries, Inc. Deezer.com provides free and legal music streaming IDInvest Partners services Number of Deals 9 Average Value ($MM) 34 Total Value ($MM) 302 (1) Private placements over $10 million and financial sponsor deals where issuer/target is headquartered in Europe (2) Firms in bold are the lead investors in the financing round (where disclosed) Source: CapitalIQ, StrategyEye, company information, Thomson, company press releases 7 This report may not be reproduced, redistributed or passed to any other person or published in whole or in part for any purpose without the written consent of Piper Jaffray. © 2013 Piper Jaffray Ltd. All rights reserved. 1 - Internet and Digital Media C - Public Market Trading Multiples Stock Fully Diluted Fully Diluted Fully Diluted Revenues EB ITDA Price Market Enterprise EV / Revenue EV / EBITDA P/E Revenues CAGR EB ITDA Margin Company Local 3 1- Dec- 12 Cap Value Dec- 12 Dec- 13 Dec- 12 Dec- 13 Dec- 12 Dec- 13 Dec- 12 Dec- 13 11- 13 Dec- 12 Dec- 13 Dec- 12 Currency (Local Ccy) (USD m) (USD m) (USD m)(USD m) (USD m)(USD m) Global Internet Leaders Google USD 707.38 235,868 196,350 4.7x 3.8x 10.6x 8.9x 18.0x 15.3x 41,552 51,653 33.2% 18,538 22,046 44.6% Microsoft USD 26.71 224,980 170,286 2.2x 2.0x 5.3x 5.0x 9.5x 8.8x 76,925 83,430 7.8% 31,868 34,312 41.4% Amazon.com USD 250.87 113,634 108,386 1.7x 1.4x 41.2x 29.0x NM NM 62,061 79,213 28.4% 2,630 3,733 4.2% Ebay USD 51.00 67,001 62,400 4.4x 3.8x 13.3x 11.5x 21.7x 18.6x 14,051 16,279 18.2% 4,692 5,416 33.4% Facebook USD 26.62 64,431 54,881 10.9x 8.4x 19.6x 14.9x 50.0x 37.7x 5,024 6,530 32.7% 2,805 3,688 55.8% Yahoo USD 19.90 23,535 15,205 3.4x 3.3x 9.9x 8.7x 16.1x 16.0x 4,458 4,599 2.5% 1,541 1,748 34.6% Mean 4 .6 x 3 .8 x 16 .6 x 13 .0 x 2 3 .1x 19 .3 x 3 4 ,0 12 4 0 ,2 8 4 19 .7 % 10 ,3 4 6 11,8 2 4 3 5 .7 % Median 3 .9 x 3 .6 x 11.9 x 10 .2 x 18 .0 x 16 .0 x 3 8 .0 % Online Retail Amazon.com USD 250.87 113,634 108,386 1.7x 1.4x 41.2x 29.0x NM NM 62,061 79,213 28.4% 2,630 3,733 4.2% Ebay USD 51.00 67,001 62,400 4.4x 3.8x 13.3x 11.5x 21.7x 18.6x 14,051 16,279 18.2% 4,692 5,416 33.4% Asos GBP 26.91