KUHN CAPITAL Monday, October 23, 2017
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Data: IT Services M&A Stats

10/30/07

We recently pulled together data on about 85 IT services M&A transactions that closed since 2006. The targets ranged in sales from $1.5 million to $3.8 billion.

For these deals the average enterprise value/sales multiple was 1.6x, and the average enterprise value/EBITDA multiple was 13.5x.

Of course, most transactions closed at EBITDA multiples less than 13.5x: the average was pumped up considerably by large US-based acquirors making "strategic" buys. Good examples of this might be Oracle's purchase of financial services industry vendor i-flex Solutions, IBM's buy of asset management specialist MRO and CapGemini's effort to break out of its lethargy by buying Kanbay, another financial services industry vendor.

Another finding: Last year we tracked 33 IT services deals. In 2007 year-to-date, we're already seen 50.


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