TECHNOLOGY MONTHLY JANUARY 2021 Our technology & tech-enabled services practice advises leading private and publicly traded technology companies including many of the world’s most respected IT consulting, managed services, technical staffing and enterprise software providers. ITS Offshore ITS Managed Services IT Staffing Transaction Processing Info Services VAR HEADLINE TRANSACTIONS TARGET ACQUIROR ACQUISITION SYNOPSIS • Cerberus Sentinel (OTCPK: CISO), a US based cybersecurity consulting company, acquired Alpine Security, a US based cybersecurity services provider • The acquisition enhances and expands Cerberus Sentinel’s cybersecurity capabilities for its clients’ growing demands • NTT Data (TSE: 9613), a Japan based provider of consulting, system development and business IT outsourcing services, agreed to acquire HashMap, a US based provider of data-driven and cloud-based solutions consulting • The acquisition helps NTT accelerate its clients’ digital transformation journeys and provide a secure foundation to operationalize and scale AI • Leidos (NYSE: LDOS), a US based science and technology company, agreed to acquire 1901 Group, a US based IT services and cloud solutions provider, for $215 million • The acquisition bolsters Leidos' market position and better equips it to respond to growing demands from its client base IT Services • Converge Technology Solutions (TSXV: CTS), a Canada based IT distributor, acquired Workgroup Connections, a US based provider of application development & integration, systems consulting, e-learning and training services • The acquisition brings to Converge 50 skilled resources holding a collective 80 prestigious partner certifications, which will help drive growth in Converge's Central and Western regions • Sirius Computer Solutions (backed by Clayton, Dubilier & Rice), a US based provider of integrated technology solutions, acquired Champion Solutions, a US based virtualization, cloud and data management services provider • The acquisition extends Sirius' geographic reach into the Southeast and expands its Microsoft 365 and Azure cloud offerings • IBM, a global integrated solutions and services company, acquired Nordcloud, a Finland based provider of cloud implementation, application transformation and managed services • The acquisition advances IBM's cloud migration and transformation capabilities, especially in its European markets • Atos (ENXTPA: ATO), a France based global provider of digital transformation solutions and services, agreed to acquire Motiv ICT Security, a Netherlands based managed security services (MSS) provider • The acquisition solidifies Atos as one of the world's largest MSS providers and bolsters its expertise in key areas such as threat detection and response Manafed ServicesManafed • Ntiva (backed by Southfield Capital), a US based IT, cloud and cybersecurity services firm, acquired Forget Computers (a US based Apple technology support provider) and Netlink Systems (a provider of managed IT services) • The acquisition of Forget allows Ntiva to be one of few MSPs to deliver full Apple support, and the acquisition of Netlink expands Ntiva’s offering of 24x7x365 security services to its clients TECHNOLOGY GROWTH & VALUATION TRENDS Enterprise Value / LTM Revenue Enterprise Value / LTM EBITDA 5.0x 25.0x 4.2x 20.5x 4.0x 20.0x 16.1x 3.0x 13.9x 3.0x 15.0x 13.6x 2.0x 1.8x 9.9x 2.0x 10.0x 1.5x 7.3x 5.2x 1.0x 5.0x 0.2x 0.3x ITS Offshore Managed IT Transaction Info VAR ITS Offshore Managed IT Transaction Info VAR ITS Services Staffing Processing Services ITS Services Staffing Processing Services LTM Revenue Growth LTM Gross & EBITDA Margin* 60.0% 59.3% 2 7.0% 24.1% 24.0% 21.0% 50.0% 48.7% 18.0% 43.8% 15.0% 39.4% 40.0% 12.0% 9.0% 6.8% 33.2% 29.1% 4.2% 3.9% 30.0% 25.7% 6.0% 25.2% 3.0% 1.9% 23.3% 0.0% 20.0% (3.0%) (0.4%) 12.6% (6.0%) 15.6% (6.6%) 2.3% (9.0%) 10.0% 10.9% 3.7% (12.0%) ITS Offshore Managed IT Transaction Info VAR ITS Offshore Managed IT Transaction Info VAR ITS Services Staffing Processing Services ITS Services Staffing Processing Services *EBITDA Margins shown as the gray line. TEV / EBITDA 25.0x25.0x 20.5x 20.0x20.0x 16.1x 13.9x 15.0x15.0x 13.6x 10.0x10.0x 9.9x TEV EBITDA / TEV 7.3x 5.0x5.0x 5.2x 0.0x0.0x Q2 Q2’172017 Q3Q3’17 2017 Q4Q4’17 2017 Q1Q1’18 2018 Q2’18Q2 2018 Q3’18Q3 2018 Q4’18Q4 2018Q1’19Q1 2019Q2’19Q2 2019Q3’19Q3 2019Q4’19 Q4 2019Q1’2020Q1 2020Q2’2020Q2 2020Q3’2020Q3 2020 Q4’2020Q4 2020 Transaction Processing Info Services Offshore ITS IT Staffing ITS Managed Services VAR 13.9x ITS 13.6x Offshore ITS 5.2x Managed Services 7.3x IT Staffing 20.5x Transaction Processing 16.1x Info Services 9.9x VAR SELECTED TECHNOLOGY TRANSACTIONS Annc. Date Sector Acquiror Target Enterprise Value Acquisition Synopsis • Valeo Networks, a US based managed IT, cybersecurity and cloud solutions provider, acquired Etech Solutions, a US based Managed Valeo 12/29/2020 Etech Solutions NA provider of managed IT consulting services Services Networks • The acquisition enhances Valeo's ability to deliver nationwide managed services with the addition of a Midwest location EBITDA Multiples Over Time • ABRY Partners, a US based middle market private equity firm, invested in GreenPages Technology Solutions, a US based hybrid 21.0xGreenPages Managed ABRY cloud services provider 12/29/2020 19.0xTechnology NA Services Partners 17.7x 17.0xSolutions • ABRY's backing accelerates GreenPages' go-to-market strategy, especially in cloud enablement, operations, security, risk, 15.0x compliance and managed services 17.6x 13.0x 11.5x 11.0x 11.4x • Rosewood Private Investments, a US based middle market private equity firm, acquired General Informatics, a US based provider Rosewood EBITDA / TEV 9.0x 8.2x Managed General of managed IT services and cloud services 12/22/2020 Private 7.0x NA Services Informatics • The acquisition is Rosewood's first in IT services, and it plans to use organic and acquisitive initiatives to expand General 7.9x Investments 5.0x Informatics' footprint into a 10-state area beyond Louisiana 5.4x 3.0x Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Microsoft • Netrix (backed by Oceansound Partners), a US based IT services and software development firm, acquired the Microsoft Consulting and Transaction ProcessingConsulting and ManagedInfo Services Services Business UnitOffshore of Prosum, ITS a US based providerIT Staffing of technology consulting,ITS recruiting andManaged staffing Services VAR Managed 12/22/2020 Netrix Managed Services NA services Services Business Unit of • The acquisition expands Netrix's presence on the West Coast and bolsters its managed services and Microsoft services Prosum capabilities Select Technology Transactions Announced in March 2019 Target Sector Acquiror• Cognizant (NasdaqGS:Target CTSH), a US basedEnterprise provider Valueof consulting,Comments technology and outsourcing services, acquired Inawisdom, a UK 12/21/2020 IT Services Cognizant 3/29/2019Inawisdom ManagedNA Calligobased Limited provider of ConnectedAI, machine learningNA and data analytics consulting• "Calligo services Limited (backed by Investcorp Bank), a UK based provider of cloud solutions for Services • The acquisition expandsTechnologies Cognizant's expertise in data and AI, cloud,businesses, digital engineering has acquired and ConnectedIoT Technologies Inc, a Canadian provider of managed IT Inc. solutions, cloud hosting, network services, and technical support • The combined client base also gives Calligo the largest concentration of CPA customers in the region and the longest track record in serving the industry’s IT, cloud and data residency needs" • Converge Technology Solutions (TSXV: CTS), a Canada based IT distributor, acquired CarpeDatum Consulting, a US based IBM Converge 3/28/2019CarpeDatum Managed NixuAnalytics Oyj consultantEzenta and AlteryxA/S PreferredNA Partner • "Nixu Oyj (HLSE:NIXU), a Finland based provider of IT security services, has acquired Ezenta 12/21/2020 IT Services Technology NA Consulting Services A/S, a Danish provider of information technology consulting services Solutions • The acquisition bolsters Converge's capabilities in AI, analytics and performance management throughout the North American market • The Ezenta acquisition strengthens Nixu’s Danish cybersecurity market presence and enables Nixu to offer cybersecurity services to Danish customers and use Ezenta’s technologies to build and support IT security infrastructure" 3/15/2019 IT Services Audius• DataBank AG (backedIT by Competence The Edgewater Funds),NA a US based provider• "Audius of enterprise-class AG, a Germany colocation, based connectivity provider of andcustomer managed relationship management software 12/17/2020 IT Services DataBank zColo NA services, acquiredGroup zColo's data center assets in the US and Europesolutions for service, maintenance, and facility management industries, has acquired a majority stake in IT Competence Group SE (DB:3IT), backed by Navigator Equity Solutions • The acquisition adds 44 data centers across 23 markets to DataBank(BST:NUQA), along with a severalGerman blue-chip provider customer of IT consulting relationships and outsourcing solutions • Audius will initially continue to manage the IT Competence Group as a separate strategic business unit; the strategic vision is to exploit economies of scale and competitive • 3Pillar Global (backed by CIP Capital), a US based software productadvantages development among company, employees, acquired customers Tiempo Development, and suppliers" a US