Costs in 2018 are also the highest across this time frame. At EV/TTM earnings multiples greater than 10 , only two acquisitions have been consummated before 2018. At 10x + and three, six of the seven acquisitions have gone off in 2018 at. It’s astonishing.
23x trailing twelve months revenue multiple was brought by qualtrics. This is actually the largest among those I have monitored. The only one higher is that the Microsoft/Github acquisition, which is based on media reports of Github&rsquo. Every one of the data points is substantiated through investor disclosures. It’s the largest ever VC backed software purchase. Congratulations to the Qualtrics team!
Let’s place the 2018 acquisition surroundings into circumstance. It’s the best M&A marketplace for $ 1B + earnings with six in the previous seven years. 2012 witnessed 3 acquisitions. In addition, $ 60B is exceeded by 2018 acquisition values for this kind of acquisition.
The shift to the cloud has happened at a larger scale than many legacy software companies estimated. And they are spending to grab. Amongst acquirers SAP, Microsoft and IBM have spent the most: $25B+ each. One company, RedHat was acquired by IBM. Microsoft bought LinkedIn and Github. SAP bought 5 firms: Ariba Concur Successfactors.
Another software acquisition, another week! This time SAP has agreed to buy Qualtrics for $8B. Qualtrics is a Utah based provider of expertise management program. Qualtrics sells and writes software to ask questions of employees and customers to help businesses enhance employee satisfaction products customer experience, and brand. This past week qualtrics had intended to go public. The business made $342M in the last twelve months and had grown 27.
Last November, a year back, I estimated that the latent buying power of this program ecosystem to be about $30B, excluding debt.