Cybersecurity Market Review

Cybersecurity M&A Activity: Deal Volume and Exit Multiples
Cybersecurity M&A Activity In Q3 Has Retreated To More Normalized Levels.
Cybersecurity M&A Volume By Year (# Deals)
Median Cybersecurity EV/TTM Revenue Multiples
107
101
88
100
136
143
97
5.5x
5.0x
4.5x
5.9x
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2010 2011 2012 2013 2014 2015 YTD16
After reaching record levels last year, Cybersecurity M&A activity in 2016 has retreated to
more normalized levels (by # of deals)
§ Total through 3Q16 announced M&A volume totaled $14.3B, representing 97
deals (Visa Equity/Infoblox, TPG/McAfee, Avast/AVG in Q3 & Symantec/
BlueCoat in Q2, represented the majority of $ amount ($11.6B))
Contemplated transactions are increasingly falling into three categories:
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§
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Transformational (a la Symantec/Blue Coat; Avast/AVG)
Opportunistic (a la Proofpoint/ReturnPath; Core Security/Damballa)
Private Equity/Buyout (a la Vista Equity/Infoblox, Ping; TPG/McAfee)
Source: Momentum Partners, 451 Research.
37
§
§
§
2013 2014 2015 YTD16
There are only 9 deals through 3Q16 with disclosed multiples at a median of 5.9x TTM
revenue
Q3 had several notable acquisitions involving Private Equity counterparties:
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Vista Equity Partners acquired Infoblox, 3.5x TTM Revenue
Thoma Bravo acquired Imprivata, 3.7x TTM Revenue
Avast acquired AVG, 3.4x TTM Revenue (Backed by CVC Capital Partners)
After two straight years of declining multiples, 2016 multiples have increased 32% since
2015 and are inline with multiples in 2013
§
Several notable strategic transactions in 2013 included IBM/Trusteer (22.5x),
Cisco/Sourcefire (8.9x) and McAfee/Stonesoft (7.0x)