Q2 2015 Snapshot

M&A Snapshot Q2 2015

Web: architectpartners.com | Email: [email protected]

M&A SNAPSHOT

2

Source: Architect Partners LLC, Capital IQ, company filings and public information a) M&A exits within Mobile | Internet | Digital Media sectors b) Core M&A exits are defined as transactions with announced or estimated values between $25 million and $1 billion in consideration, as these typically represent successful business-

building endeavors c) Premium value transactions are defined as greater than 5 times invested equity capital or 5 times estimated last twelve months revenue (LTM)

Q2 - 2015The uptrend continues in Q2 2015 and China gets even hotter. Core M&A activity was up by 36% year over year with non-U.S.-based activity leading the growth. As we observed last quarter, China M&A has taken o in the past 18 months in terms of both number of transactions and size. Almost entirely comprised of Chinese acquirers acquiring Chinese-based targets, 22% of the core M&A transactions this quarter are Chinese deals. While U.S. activity is strong, activity levels are essentially flat over the past four quarters. We believe one factor inhibiting U.S. M&A in the internet, mobile and digital media sector is the wide open spigot of the private financing market. Some VC's and a variety of late-stage private equity investors are oering substantial capital at exceptionally high valuations. Many strategic acquirers cannot or will not oer compelling acquisition terms as an alternative.

Total M&A Exits (a)

Proportion Premium Value (c) % of Total M&A Exits % of Core M&A Exits

Core M&A Exits (b)

Total Consideration $B (b)

Average Consideration $230mm. Up 31% Year-Over-Year

20152013 2014

$20.0$13.5$13.8

$18.5$12.3$9.4$9.6$8.1$7.0

466 387 327 406 416 494

3% 5% 2% 3% 4% 4%32% 42% 17% 18% 29% 27%

Q2Q2 Q3 Q4 Q1 Q2 Q3

464

4%20%

Core M&A Exits Up 36% Year-Over-Year

Q4

4%26%

509

Q1

785

3%16%

867663747045

614133

M&A BY SECTOREnterprise Applications and Digital Marketing continue to lead by activity levels and the most strategically interesting transactions this past quarter were largely within those categories.

The acquisition of AOL by Verizon was the marquee transaction (our M&A Alert) of the quarter by size and strategic importance. As we highlight in our M&A Alert,Verizon has crossed two bright lines with this transaction 1) moving more into the content business, and 2) using its customer data for ad targeting.

Twitter continued its thoughtful M&A strategy with the acquisition of TellApart, designed to enhance their ad monetization by better understanding and targeting their audience. Also of note, Uber has demonstrated an ambitious intent to "own" its own maps and logistics capabilities via the acquisition of Microsoft's map business this quarter which closely follows the acquisition of deCarta's turn-by-turn navigation platform and its participation the auction for Nokia's HERE business.

Core Transactions by Sector

Total sector M&A value in $mm 3

Consumer Application Enterprise Application Analytics Application Network Infrastructure App Development Security Commerce Digital Marketing Media Hardware Service Provider

SECTORS

Source: Architect Partners LLC, Capital IQ, company filings and public information

Q2 - 2015

$1,064$2,376$2,183 $1,062 $1,000 $1,282$2,675 $1,494$5,883 $600 $153

3%7%12%2%

6%

7%

6%

17%

29%

1%9%

CommerceConsumer

ApplicationAnalytics

Application

Enterprise Application

Digital Marketing

Hardware

Network Infrastructure

Security

Media

App Development

Service Provider

Number of Deals by Sector

(In terms of number of acquisitions)

2 / 5 | $18.9B

3 / 8 | $533mm

0 / 5 | $367mm

a) A number of transactions do not have disclosed acquisition price, so aggregate value of deals over the last twelve months is likely understated.

9.

Number of new deals in Q1 / total deals last 4 quarters | total spend last 4 quarters (a)

5

1. 2.3 / 14 | N/A

3. 4. 5.

6. 7. 8. 10.

MOST ACTIVE ACQUIRERS LTM


3 / 11 | $2.5B

0 / 4 | $500mm

Agawi Timeful Pulse.io

0 / 10 | $648mm 3 / 6 | N/A

1 / 5 | $1.4B 2 / 5 | $1.7B

6 Wunderkinder GmbH BlueStripe Software Datazen Software

None TellApart tenXer Whetlab

Blue Box Group Explorys Phytel

lynda.com Refresh

Altera Recon Instruments

NoneVoyagin

None

1 / 4 | $2.6B 1 / 4 | N/A

14.11. 12. 13. 15.

2 / 5 | N/A

0 / 4 | N/A3 / 4 | $450mm

Accelyst Solutions Letsgomo Labs MartMobi

ConteXtream SoThree None

Coherent Navigation Metaio

CORE TRANSACTIONS

BUYER TARGET TRANSACTION VALUE ($MM) TARGET DESCRIPTIONAP M&A ALERT VC-BACKED

8x8 (Nasdaq:EGHT) DXI 25 Cloud-based enterprise and contact centre communication solutions. Based in London, United Kingdom. Yes

Accton Technology (TSEC:2345) SMC Networks 26

Manufactures and sells network solutions, primarily hardwares, to households and enterprises.

Allegion Luxembourg Holding and Financing

S. r.l.

SimonsVoss Technologies GmbH 235

Access control and biometry systems worldwide. Based in Unterfoehring, Germany.

Allwin Telecommunication

(SZSE:002231)Shanghai Snowfish Tech 248 Mobile entertainment, primarily gaming. Based in Shanghai, China. Yes

Amazon (Nasdaq:AMZN) Clusterk 50 Amazon AWS cloud computing management. Yes

Amdocs (Nasdaq:DOX) Comverse, Business-Support System 272 Billing and customer management systems for service providers.

Apax Partners Zap Group 37 Operates various directory and information websites in Israel and internationally. Based in Ramat Gan, Israel. Yes

ASSA ABLOY AB (OM:ASSA B) Flexim Security Oy 39 Security and attendance monitoring products. Based in Espoo, Finland.

Automattic Bubblestorm Management 30 Develops and oers a software plug-in that enables websites for ecommerce. Based in Belville, South Africa.

AVG Technologies (NYSE:AVG) HideMyAss.com 60 Main product of Privax, a VPN encryption company.

BlackBerry (TSX:BB) WatchDox 70 Enterprise file synchronization and sharing platforms. Yes

BlueFocus Communication (SZSE:

300058)Domob Network Technology 109 Mobile and internet advertising platform. Based in Beijing, China. Yes

Premium Value M&A

6Mobile | Internet | Digital Media M&A transactions with announced or estimated consideration between $25 million and $1 billion.

Q2 - 2015

CORE TRANSACTIONS (CONTINUED)Premium Value M&A


Q2 - 2015


Brand Networks SHIFT 50 Real-time collaboration platform for people from multiple parties to work together on projects (ad campaign). Yes

CA (Nasdaq:CA) Rally Software (NYSE:RALY) 534 Management solutions for Agile software development worldwide.

Cathay Capital Private Equity SAS Smartadserver 40 Develops adserving technologies. Based in Paris, France.

CEO-Led Buyout Kongzhong (Nasdaq:KZ) 353 Digital entertainment services, with emphasis on gaming, in China. Based in Beijing, China.

CEO-Led Buyout AirMedia Group (Nasdaq:AMCN) 247Digital media ad network (digital screens) in high-trac locations (airports, etc) in China. Based in Chaoyang, China.

CEO-Led Buyout iDreamSky (Nasdaq:DSKY) 492 Licenses and operates mobile games, with multiple being globally renowned in Apple App Store. Based in China.

CEO-Led Buyout China Information Technology (Nasdaq:CNIT) 157 Cloud-based data solutions to enterprises.

CEO-Led Buyout Renren (NYSE:RENN) 990 Social networking internet platform in China. Based in Beijing, China.

CEO-Led Buyout Vimicro (NasdaqGM:VIMC) 342 Develops semiconductor product with multimedia applications, specifically video processing.

Charter Communications (Nasdaq:CHTR) ActiveVideo Networks 135

Develops cloud-based HTML5-powered video-streaming software across platforms.

Cisco (Nasdaq:CSCO) OpenDNS 635 Extends the Domain Name System by adding features such as phishing protection and optional content filtering.

Ciena (NYSE:CIEN) Cyan (NYSE:CYNI) 275 Major performance upgrade services for legacy network companies.

Compagnie Generale DES Etablissements Michelin

SCA (ENXTPA:ML)blackcircles.com 76 Online car tire retailer that oers automobile tires for consumers in the United Kingdom. Based in Edinburgh, United Kingdom.

CORE TRANSACTIONS (CONTINUED)


Comverse (NasdaqGM:CNSI) Acision Global 210

Messaging softwares for communication service providers and enterprises. Based in Reading, United Kingdom.

Continental Aktiengesellschaft

(DB:CON)Elektrobit Automotive GmbH 668 Frontier embedded softwares for the automobiles. Based in Erlangen, Germany.

CoStar Realty Information Network Communications 170 Publishes information for the real estate market in North America.

Crowd Mobile (ASX:CM8) Track Concepts B.V. 30 Mobile payments solutions for telecommunication companies globally. Based in Amsterdam, Netherlands.

ctrip.com eLong (Nasdaq:LONG) 682 Online travel services in China. Based in Beijing, China.

Cypress Semiconductor (Nasdaq:CY)

Integrated Silicon Solution (Nasdaq:ISSI) 634

Fabless semiconductor company, that designs and markets integrated circuits.

CyrusOne Cervalis 400 Provides data center services. Yes

Dean Drako, CEO of Eagle Eye Brivo Systems 50 Provides SaaS applications for security management.

Dun & Bradstreet Dun & Bradstreet Credibility 350 Credit building and credibility solutions for businesses.

Eckoh (AIM:ECK) Netcall (AIM:NET) 138Communications, workforce, and business process management software internationally. Based in Hemel Hempstead, the United Kingdom.

Envestnet (NYSE:ENV) Oltis Software 32 Customized financial planning and client management solutions for financial industry.

Epiq Systems Iris Data Services 134 Data and electronic discovery services, such as data collection and forensics.

Premium Value M&A


Q2 - 2015



Fortinet (Nasdaq:FTNT) Meru Networks (NasdaqGM:MERU) 42 Virtualized wireless local area network (LAN) solutions.

Francisco Partners Management

ClickSoftware (Nasdaq:CKSW) 421

Software for workforce management worldwide. Based in Petach Tikva, Israel.

Francisco Partners Management Procera Networks 238

Network performance solutions based on Deep Packet Inspection (DPI) to network operators worldwide. Yes

GigOptix (AMEX:GIG) GSI Technology (Nasdaq:GSIT) 152Develops and markets high-performance memory products primarily for the telecommunications industry.

Gosuncn Technology Group

Guangzhou Goldmessage Technology 40

Provides data security software and solutions. Based in Guangzhou City, China.

Grupo Ezentis SA (CATS:EZE)

Ability Tecnologia e Servios S/A 62

Operates fixed line telecommunication networks in Sao Paulo. Based in So Paulo, Brazil.

Guangdong Sky Dragon Printing Ink Group (SZSE:

300063)Yutang Lianchuang 209 Internet and search engine media marketing services. Based in China.

Hotspring Ventures Treatwell Holding BV 38 Online reservation site for hair and beauty treatments. Based in Amsterdam, the Netherlands. Yes

Hunan TV & Broadcast Intermediary (SZSE:

000917)Jiuzhi Tianxia Technology 52 Operates an Android application store, a mobile game distribution platform, and a mobile browser. Based in Shenzhen, China.

Infinera (Nasdaq:INFN) Transmode AB (OM:TRMO) 346 Packet-optical networking solutions to manage the capacity needs in video and data trac. Based in Stockholm, Sweden.

Infosys (BSE:500209) Skava 120 E-commerce platforms, including mobile websites and apps.

Jasper Infotech Accelyst Solutions 450 Online mobile recharge services. Based in Mumbai, India. Yes

Premium Value M&A


Q2 - 2015



JUST EAT (LSE:JE.) Menulog Group 687 Online takeaway food and home delivery platform. Based in Sydney, Australia. Yes

Keysight Technologies Netherlands B.V. Anite (LSE:AIE) 584

Mobile device, infrastructure and network testing systems to the wireless market worldwide. Based in Fleet, United Kingdom.

KION GROUP AG (DB:KGX)

Egemin International NV, Handling Automation

Division81 Internal logistics automation solutions. Based in Belgium. Yes

Knowles (NYSE:KN) Audience (Nasdaq:ADNC) 131 Voice and audio hardware solutions for mobile devices worldwide. Yes

M2 Group (ASX:MTU) Call Plus & 2Talk 186 Broadband and fixed voice services. Based in New Zealand.

Market Tech (AIM:MKT) Stucco Media 43 Data-driven e-commerce marketing platform. Based in Tel Aviv, Israel.

MasterCard (NYSE:MA) Applied Predictive Technologies 600Cloud-based predictive analytics software solutions, with emphasis in profit measurement. Yes

Millicom International Cellular SA

(OTCPK:MIIC.F)Zanzibar Telecom 74 Fixed, mobile, and data communications services primarily in Africa. Based in Zanzibar, Tanzania.

NameFind Marchex, Domain Name Portfolio Business 28 Domain name registration services.

Netia S.A. (WSE:NET) Telekomunikacja Kolejowa Splka z o.o. 62 Public telecommunications carrier in Poland. Based in Warsaw, Poland.

NetSuite (NYSE:N) Bronto Software 200 Automated marketing platform for companies.

Novatel Wireless (Nasdaq:MIFI) DigiCore (JSE:DGC) 93

GPS/GSM fleet management and vehicle tracking solutions, primarily in South Africa. Based in Centurion, South Africa.

Premium Value M&A


Q2 - 2015



NYX Gaming Group (TSXV:NYX) CryptoLogic 119

Gaming applications and entertainment content in North America and Europe. Based in Dublin, Ireland.

Orient SecuritiesChina Mobile Games and

Entertainment (NasdaqGM:CMGE)

703 Develops and operates mobile games primarily in China. Based in Guangzhou, China.

Orient Securities Taomee (NYSE:TAOM) 99 Operates as a childrens entertainment, media and products company in China. Based in Beijing, China.

Perfect Commerce Hubwoo (ENXTPA:HBW) 29 Spend management and collaborative business process automation. Based in Paris, France.

Pitney Bowes (NYSE:PBI) Borderfree (Nasdaq:BRDR) 465 Cross-border ecommerce solutions.

Qiwi (Nasdaq:QIWI) SAER 167 Electronic payment services. Based in Moscow, Russia.

Quality Technology Services Carpathia Hosting 326 Cloud services and managed hosting for enterprises worldwide. Yes

Recruit Holdings (TSE:6098) Hotspring Ventures 170 Beauty treatment website. Based in London, United Kingdom. Yes

Red Ventures Holdco Imagitas 310 Online and oine direct marketing solutions for advertisers. Yes

Redknee Solutions (TSX:RKN) Orga Systems GmbH 43

Real-time charging and adminstration software for mobile telecommunication industry. Based in Paderborn, Germany.

Rogers Communications (TSX:RCI.B)

Data & Audio-Visual Enterprises Holdings 355

Wireless telecommunication services in Canada. Based in Vaughan, Canada. Yes

Singapore Telecommunications

(SGX:Z74)TrustWave Holdings 810 Provides data security and compliance management solutions to businesses. Yes

Premium Value M&A


Q2 - 2015

CORE TRANSACTIONS


SolarWinds (NYSE:SWI) Papertrail 41 Hosted log management.

Talkweb Information System (SZSE:002261)

Shandong Changzheng Education Technology 117 Software for pre-school education. Based in Zibo, China.

Tieto Oyj (HLSE:TIE1V) Software Innovation ASA 78 Enterprise content and information management software. Based in Fornebu, Norway. Yes

Twitter (NYSE:TWTR) TellApart 533 Online marketing applications for e-commerce retailers worldwide. Yes

Valid USA Marketing Software Company 41 Integrated database marketing services.

Vista Equity PartnersPearson Education, Student

Information Systems Businesses

350 Web-based information systems for schools.

Visteon Technical And Services Centre

Visteon Automotive Systems India, EPG Business 50

Electronic program guides (EPG) software for automobiles. Based in India.

Wowo (NasdaqGM:WOWO) Join Me Group 524

B2B procurement platform for the foodservice industry in China. Based in Hong Kong Yes

Yellow Pages (TSX:Y) ComFree/DuProprio Network 38 A flat-fee real-estate discovery and buying platform. Based in Canada. Yes

Youzu Interactive (SZSE:002174)

Guangzhou Zhangtao Network Technology 87 Various big-data services in the mobile internet field. Based in China.

Zhejiang New Jialian Electronics (SZSE:

002188)Bus Online 272 TV network on buses in China. Based in Shanghai, China. Yes

Zoopla Property Group (LSE:ZPLA) Ulysses 292

Comparison website for internet-associated consumer products and services, such as laptops and broadband. Based in London, United Kingdom.

12

Premium Value M&A

Mobile | Internet | Digital Media M&A transactions with announced or estimated consideration between $25 million and $1 billion.

Q2 - 2015

OTHER NOTABLE DEALS

13

Premium Value M&A

Mobile | Internet | Digital Media M&A transactions with announced or estimated consideration in excess of $1 billion.

Q2 - 2015


Adobe (Nasdaq:ADBE) Tumri - Advertising platform for highly-targeted messages to consumers.

Adobe (Nasdaq:ADBE) Mixamo - 3D computer graphics technology company, focusing on automated animation. Yes

App Annie Mobidia - Tracks actual usage of millions of IOS and Android apps. Yes

Apple (Nasdaq:APPL) Metaio - Augmented reality software technology and solutions. Yes

Avago (Nasdaq:AVGO) Broadcom (Nasdaq:BRCM) 36,698 Provides semiconductor solutions for wired and wireless communications.

CEO-Led Buyout Momo (Nasdaq:MOMO) 1,863 A social-network company, focusing on expanding social circle based on location and interest. Based in Beijing, China.

CEO-Led Buyout Qihoo 360 (NYSE:QIHU) 9,913 Provides internet services in China and mainly oers various security products. Based in Beijing, China.

Charter Communications (Nasdaq:CHTR)

Time Warner Cable (NYSE:TWC) 78,428

Provides video, high-speed data, and voice services in the United States.

Cisco (Nasdaq:CSCO) Tropo - Platform enabling web developers to write communication applications in various programming languages.

Cox Automotive Dealertrack (Nasdaq:TRAK) 4,547 Provides web-based software solutions and services to the automotive retail industry in the United States and Canada.

EMC Corporation (NYSE:EMC) Virtustream 1,200 Provides enterprise-class cloud software and services worldwide. Yes

Equinix (Nasdaq:EQIX) Telecity Group (LON:TCY) 4,064 Oer co-location and related services in multiple European countries. Based in London, United Kingdom.

Google (Nasdaq:GOOG) Timeful - Time management app to increase productivity, with data-driven approach. Yes

Google (Nasdaq:GOOG) Agawi - Platform allowing people to access apps on their phones without downloading them. Yes

Google (Nasdaq:GOOG) Pulse.io - Mobile apps performance monitering platform. Yes

OTHER NOTABLE DEALS

14

Premium Value M&A

Mobile | Internet | Digital Media M&A transactions with announced or estimated consideration in excess of $1 billion.


Hewlett-Packard (NYSE:HP) ConteXtream -

Develops software-defined networking (SDN) and network-function virtualization (NFV) software. Yes

Hua Capital Led Acquisition OmniVision (Nasdaq:OVTI) 1,900

Designs, develops, manufactures and markets semiconductor image-sensor devices worldwide.

Intel (Nasdaq: INTC) Recon Instruments - Smartglasses and heads-up display solutions, delivering information like activity metrics and maps to users eyes. Yes

Intel (Nasdaq: INTC) Altera (Nasdaq:ALTR) 18,220 A semiconductor company that designs and sells customized integrated circuits.

Iron Mountain (NYSE:IRM) Recall (ASE:REC) 2,594

Provides information management solutions worldwide. Based in Alexandria, Australia.

LinkedIn (NYSE:LNKD) Refresh - Data-driven social networking company, providing insight about relationships between contacts. Yes

LinkedIn (NYSE:LNKD) lynda.com 1,500 Provides instructional videos and courses to enterprises and individuals. Yes

Nokia (NYSE:NOK) Alcatel-Lucent (NYSE:ALU) 22,390 Provides broadband access worldwide. Based in Boulogne-Billancourt, France.

Permira Advisers & Canada Pension Plan

InvestmentInformatica (Nasdaq:INFA) 5,321 Provides enterprise data integration software and services worldwide.

SalesForce (NYSE:CRM) Toopher - Enterprise multifactor authentication platform. Yes

Rakuten (TYO:4755) Voyagin - Online traveling platform. Based in Tokyo, Japan.

Telenet (EBR:TNET) BASE Company nv 1,425 Provides mobile telephony, TV, internet, and fixed telephony solutions. Based in Brussels, Belgium.

Uber Microsoft, Bing Map Division - Map applications, and map APIs.

Verizon (NYSE:VZ) AOL (NYSE:AOL) 4,759 Provides various digital brands and products to consumers worldwide.

Q2 - 2015

Web: architectpartners.com | Email: [email protected]

Q2 2015 Snapshot

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