Internet DealBook

Third quarter global M&A and

investment activity
1 July - 30 September 2018

Internet DealBook is published by Right Click Capital

Disclaimer
The information contained herein is of a general nature and comes from
independent sources. It is not intended to address the circumstances of
any particular individual or entity. Although we endeavour to provide
accurate and timely information, there can be no guarantee that such
information is accurate as of the date it is received or that it will continue
to be accurate in the future. No one should act on such information
without appropriate professional advice after a thorough examination of
the particular situation. Accordingly Internet DealBook and all its related
entities hereby excludes any liability to any person in consequence of his
purported reliance upon information contained herein or omitted here
from (whether express or implied) or otherwise furnished in connection
herewith. Any requests for information in connection with this document
should be addressed directly to Internet DealBook and to no other party.
All amounts in USD unless stated otherwise.
Informational Sources
All information contained in this presentation was sourced using Internet.
DealBook’s database. All additional information used to create the IDB
indices, was sourced from InternetWorldStats.com on January 2018.
Internet DealBook collects and compiles all their data from publicly
available sources. Average deal values are calculated using only deals
where the value has been disclosed. Visit Internet Dealbook for more
information on the methodology used for tracking and collating deals.
Copyright Notice
This report is compiled and published by Internet DealBook and is
covered by copyright. All rights reserved. No part of the publication may
be published, reproduced (see exception below), stored in a retrieval
system, translated, or transmitted in any form or by any means now or
hereafter known, electronic or mechanical, without correct attribution
and a link back to Internet DealBook according to the guidelines below.
The copyright owner consents that copies of articles may be made for
personal or internal use, or for the personal or internal use of the company,
individual or organisation who requested the creation of this document
from Internet DealBook. Should a party wish to syndicate or reproduce the
content contained herein, they must provide a link back to Internet
DealBook and properly reference/cite Internet DealBook within the
article/document/site or medium/place of reproduction. Internet
DealBook wishes to be informed of the reproduction via email at
info@internetdealbook.com. If you have any questions regarding our rights
and permissions policies, or if you have a special request not covered by
these guidelines, please contact Internet DealBook.
2
Overview – sectors and regions

Sectors Regions

1. Ecommerce 1. Asia & Pacific

2. Games 2. Europe
3. Hardware & Infrastructure 3. Middle East
4. Marketing 4. North America
5. Media 5. Rest of World
6. Mobile & Apps 6. South America
7. Software & Services
8. Transactions

3
Global summary
3,457 deals tracked from public sources in
Q3 2018, an increase from 2,140 in Q3 2017
$102.5bn of deals tracked in Q3 2018, a
159.9% increase from USD39.4bn in Q3 2017
$76.9m recorded in median acquisition
deal value in Q3 2018. This is an increase from
$50.0m in Q3 2017. Average acquisition deal
value is up to $311.2m in Q3 2018 from
$176.6m in Q3 2017, where large acquisitions
took place in the Software & Services sectors
$6.4m recorded in median investment
deal value in Q3 2018. This is a decrease from
$6.8m in Q3 2017. Average investment deal
value reached $29.9m in Q3 2018, an increase
from $24.9m recorded in Q3 2017
1,486 deals recorded in the Software &
Services sector, making this the most active
out of all categories
16 companies received investment from
Tencent, one of the most active venture capital
investors. The majority of these investments
went into US-based businesses. Softbank and
Alibaba followed closely, making investments
into 13 and 12 technology based businesses
respectively. However, most of the investments
were into China-based businesses
4
Geographic overview
Number and spread of deals by region

756

21.9%

47.2% Asia/Pac
Europe 28.5%
and
North Middle East
1,633 America 985

Africa

South
24 America

<1.0%

§ The number of deals tracked reached to 3,457 deals, up from 2,140 deals in Q3 2017

§ Almost 72% of deals recorded were investments into technology businesses, with the remaining 28% being acquisitions. This
compares with approximately 67% of 2017 deals being investments and 33% being acquisitions. This trend will likely continue
through to 2019 as a growing number of early stage companies develop an appetite for larger funding rounds

§ Rest of world: 59 deals 5

 Top 10 countries
Country Deal value ($bn) ADV ($m) Total deals

US 55.6 62.6 888

China 21.3 98.1 217

UK 4.3 27.2 158

India 3.7 28.2 130

France 3.4 83.5 41

Brazil 2.1 206.4 10

Singapore 1.9 44.4 43

Sweden 1.5 39.0 38

Germany 1.5 32.1 47

Australia 1.0 21.4 49

6
Note: ADV = average deal value
 Geographic overview
ADV
2018 - 59.93m

Deal value by region ($bn) 2017ADV

- 31.31m
2018 ADV
– 59.9m
2018––31.3m
2017 59.9m
60.0 2017 – 31.31m
56.4

50.0

ADV
40.0 2018 – 57.3m
2017 – 55.2m
Billions

29..3
30.0
ADV
2018 – 29.2m
2017 – 19.3m 18.9
20.0
ADV 13.0 13.5
ADV ADV 2018 – 151.3m
2018 – 26.4m 2018 – 15.7m 2017 – 7.9m
10.0 2017 – 4.3m 2017– 40.6m
5.6
1.4 2.3
0.1 0.6 0.9 0.1
0.0
Rest of World Middle East South America Europe Asia/Pac North America

2017 2018

§ North America and Asia/Pac– total deal value and average deal value increased due to large investment rounds fuelled by US
investors Cisco and Carlyle Group, who invested heavily into Transactions and Software & Services companies in 2018

§ Middle East– total deal value and average deal value decreased due to a lower number of billion dollar acquisition deals being
made with the biggest transaction capping out at US$157.4 m
7
Note: ADV = average deal value
 Sector overview
ADV
Deal value by sector ($bn) 2018 – 50.4m
2017 – 37.5m
45.0
32.6
ADV
40.0 2018 – 52.2m
2017 – 28.1m

35.0 41.5

30.0

25.0
Billions

ADV
20.0 2018 – 70.2m
ADV 2017 – 32.7m
13.3
2018 – 112.2m
15.0 ADV
2017 – 44.8m
15.6
ADV 2018 – 36.4m
ADV ADV 2018 – 36.8m 10.0
2017 – 19.0m
10.0 2018 – 30.6m 2018 – 33.6m 2017 – 145.3m
2017 – 26.4m 2017 – 9.9m 7.1
4.7 3.8
5.0 3.1 3.3
0.8 1.3 1.7 1.0 1.5
0.5
0.0
Games Mobile & Apps Ecommerce Marketing Media Hardware & Transactions Software &
Infrastructure Services

2017 2018

§ Transactions – experienced a large uptick in total deal value due to multibillion dollar investment rounds into companies out of
the US and the acquisition of Sedgwick, BlueLine Rental and TravelClick

§ Software & Services – also experienced a large increase due to several big acquistions from the US including Duo Security,
Accruent and Athena Superhold with deal values in excess of US$2bn
8
Note: ADV = average deal value
Investments – geographic overview
Number and spread of investments by region

504

20.4%

42.5% Europe Asia/Pac

and
34.7%
North
1,053 America
Middle East
860

Africa

South
16 America

<1.0%

§ The number of investment deals tracked reached 2,477, up from 1,429 deals in Q3 2017

§ North America leads the world in number of deals recorded with almost 40% of total investments tracked going into US
companies. This is driven by its strong venture capital and private equity/growth equity market. This trend is increasingly
prevalent in Asia/Pac and we can expect the number of investments to continue rise in this region in 2019

§ Rest of world: 44 deals

9
 Investments – sector overview
Investment value by sector ($bn) ADV
2018 – 40.1m
30.0
2017 – 32.7m

25.0 24.3
ADV
2018 – 20.5m
2017 – 17.0m
20.0

15.7
Billions

15.0
13.1
ADV
2018 – 43.7m
ADV 2017 – 24.7m
10.0 ADV
ADV 2018 – 58.3m
2018 – 33.2m 7.5
2018 – 17.6m 2017 – 145.3m 2017 – 42.61m
ADV ADV
2017 – 16.0m 5.7
2018 – 13.7m 2018 – 17.2m
5.0 2017 – 4.8m 2017 – 9.9m 3.3
3.1 2.9 2.7
2.1
0.8 0.7 1.3
0.1 0.5 0.5
0.0
Games Mobile & Apps Marketing Ecommerce Media Hardware & Software & Services Transactions
Infrastructure

2017 2018

§ Transactions – investments rose in 2018, with $1.5bn cheques being written into Chinese companies by investors such as
Tencent and Didi. For example, Chinese real estate transactions marketplace Lianjia raised $1.5bn from Tencent

§ Software & Services– competition in artificial intelligence, facial recognition etc. has fueled a 123% increase in growth in this
sector

10
Note: ADV = average deal value
Investments – top 10 deals
Company Sector Raised ($bn)

Media 1.5

Transactions 1.5

Transactions 1.0

Transactions 1.0

Software & Services 1.0

Hardware & Infrastructure 1.0

Transactions 1.0

Hardware & Infrastructure 0.6

Hardware & Infrastructure 0.6

Media 0.6

11
Acquisitions – geographic overview
Number and spread of acquisitions by region

252

25.7%

Asia/Pac
59.2% Europe 12.8%
and
North Middle East
580 America 125

Africa

South
8 America

<1.0%

§ North America – total number of acquisitions increased from 415 in Q3 2017 to 580 in Q3 2018. Most consolidation took place
in the Software & Services sector, which accounted for 55% of total number of deals being made

§ Asia/Pac – the average deal value increased significantly by 520.3% from $26.9m in 2017 to $167.2m in 2018 Q3 due to large
acquisitions of companies such as Lixens by Tsinghua Unigroup and New Classics Media by China Literature worth $2.6bn and
$2.2bn respectively
12
 Acquisitions – sector overview
Acquisition value by sector ($bn) ADV
2018
ADV
2018 –– 365.
365.1m
2017 – 186.97m
30.0 2017 – 169.0m

26.3

25.0

20.0

ADV
Billions

ADV
15.0 2018 – 360.4m
2018 – 207.4m
2017 – 141.8m
2017 – 141.8m
ADV
2018 – 543.4m
ADV
10.0 2017 – 78.5m
2018 – 237.1m
8.3
ADV ADV ADV 2017 – 46.6m
2018 – 194.0m 2018 – 129.1m 2018 – 420.0m
5.8
2017 – 0.0m 2017 – 318.9m 2017 – 0.0m
5.0 3.8 4.3
2.6 2.4
0.6 0.8 0.8 1.1
0.0 0.4 0.0 0.2 0.2
0.0
Ecommerce Games Mobile & Apps Marketing Media Hardware & Transactions Software &
Infrastructure Services

2017 2018
§ Software & Services saw a 353.4% increase in total acquisition value from $5.8m to $26.3m from Q3 2017 to Q3 2018 due to
several large scale acquisitions such Cisco’s acquisition of Duo Security for $2.35bn and ranking as the third largest acquisition
in 2018 Q3, boosting total deal value for the quarter

§ Even though the number of acquisitions recorded increased, acquisition deal values plunged by 46.0% and average deal value
fell by 81.0%, which suggests that more consolidation is happening in the SME market rather than in the enterprise market
13
Note: ADV = average deal value
Acquisitions – top 10 deals

Company Acquirer Sector Value ($bn)

Software & Services 6.7

Hardware & Infrastructure 2.6

Software & Services 2.4

Media 2.2

Transactions 2.1

Software & Services 2.0

Athena Superhold Co. Software & Services 2.0

Software & Services 1.8

Transactions 1.5

Software & Services 1.5

14
 Australia summary
81 deals tracked from public sources in Q3
2018, a 40% increase from Q3 2017
$1,430.0m of investments and
acquisitions recorded in Q3 2018, a 641%
increase from Q3 2017. (This marks a record
year in total deal value in Australia.
$13.8m recorded in total acquisition deal
value in Q3 2018. This is a decrease from
$68.3m recorded in Q3 2017. Average
acquisition deal value decreased, from $17.1m
in Q3 2017 to $6.9m in Q3 2018
Note: all amounts in AUD
$1,416.2m recorded in total investment
deal value in Q3 2018. This is an increase from
$124.7m in Q3 2017. Average investment deal
value reached $30.1m in Q3 2018, an increase
from $4.5m in Q3 2017
41 transactions recorded in the Software &
Services sector, making this the most active
sector in Australia for investments and
acquisitions
$850.0m was raised by Hardware &
Infrastructure player Airtrunk, driving a
1,244.6% year-on-year increase in total deal
value for the sector
15
 Australia sector overview
Q3 2017 Q3 2018
Sector
total deal value ($m) total deal value ($m)

Hardware & Infrastructure 72.0 896.1

Transactions 58.6 337.8

Software & Services 56.6 185.8

Mobile & Apps 2.3 5.0

Games 3.5 3.2

Ecommerce 0.0 2.0

Marketing 0.0 0.0

Media 0.0 0.0

16
Note: all amounts in AUD
 Australia – top 10 deals
Company Buyer/investor Sector Raised ($m)

Consortium Hardware & Infrastructure 850.0

Consortium Transactions 140.0

Consortium Transactions 109.0

Consortium Software & Services 54.5

Consortium Software & Services 21.0

Consortium Software & Services 20.8

Hardware & Infrastructure 20.7

Hardware & Infrastructure 19.0

Software & Services 17.0

Transactions 15.5

17
Note: all amounts in AUD
Investments – sector overview
Number of investments by sector
2% 2% 2%

4%
Software & Services = 22
4%
Transactions = 19
9% Hardware & Infrastructure = 5
41% Media = 2
Ecommerce = 2
Marketing = 1
Mobile & Apps = 1
Games = 1

36%

§ Australia saw an increase in number of investments between Q3 2017 to Q3 2018, increasing by 71%

§ Hardware & Infrastructure saw a 120% increase, driven by heavy investments in the development of intelligent hardware and
technology solutions

§ Largest increase seen in Software & Services, fuelled by investments in cloud solutions, cutting edge management platforms
and AI-driven technologies 18
Acquisitions – sector overview
0% 0%
Number of acquisitions by sector
0% 0%

3%
11% Software & Services = 19
Transactions = 5
Marketing = 3
Hardware & Infrastructure = 1
18% Mobile & Apps = 0
Ecommerce = 0
Media = 0
68% Games = 0

§ Total number of acquisitions in Australia increased by 4% from Q3 2017 to Q3 2018, from 27 transactions tracked to 28
transactions

§ Acquisition activities remain at a similar level compared to Q3 2017, although the number of deals in Transactions increased
by 150%, owing to the surging popularity of cryptocurrencies and online payment platforms

19
Southeast Asia summary
95 deals tracked from public sources in Q3
2018, a 40% increase from Q3 2017
$2.1bn of investments and acquisitions
recorded in Q3 2018, a 30% decrease from
$3.0bn in Q3 2017
$356.1m recorded in total acquisition
deal value in Q3 2018. This is a huge increase
from $29.0m recorded in Q3 2017. Average
deal value for acquisitions also increased
significantly, from $30.0m in Q3 2017 to
$178.1m in Q3 2018
$1.7bn recorded in total investment deal
value in Q3 2018. This is a decrease from
$2.9bn in Q3 2017. Average investment deal
value reached $27.3m in Q3 2018, a decrease
from $84.0m in Q3 2017
43 deals recorded in the Transactions sector,
making this the most active sector for
investments and acquisitions in Southeast Asia
$1.0bn investment secured by Grab, the
largest transaction by value, driving growth in
the Transactions sector
20
 Southeast Asia sector overview

Sector Q3 2017 total deal value ($m) Q3 2018 total deal value ($m)

Transactions 2,683.9 1,251.3

Hardware & Infrastructure 1.4 548.1

Software & Services 92.9 230.6

Marketing 9.5 24.7

Ecommerce 16.0 19.3

Games 0.0 0.8

Media 136.2 0.0

Mobile & Apps 32.5 0.0

21
Note: all amounts in USD
 Southeast Asia – top 10 deals
Company Buyer/investor Sector Raised ($m)

Consortium Transactions 1,000.0

Hardware &
350.1
Infrastructure
Hardware &
Consortium 140.0
Infrastructure
Software & Services 125.0
Hardware &
40.0
Infrastructure
Consortium Transactions 32.0

Undisclosed Transactions 31.0

Consortium Transactions 30.0

Consortium Software & Services 28.0

Consortium Transactions 24.0

22
Note: all amounts in USD
Investments – sector overview
Number of investments by sector
2% 1%

6%
Transactions = 41
6%
Software & Services = 29
7% Hardware & Infrastructure = 6
Marketing = 5
46% Ecommerce = 5
Games = 2
Media = 1
Mobile & Apps = 0
32%

§ SEA saw an increase in number of investments between Q3 2017 to Q3 2018 by 78%

§ Software & Services experienced a 142% year-on-year increase, with specific focus on IoT solutions, AI- and data-driven
platforms

§ Transactions saw a 71% increase compared to Q3 2017, with the largest investment being $1.0bn in Grab, and driven by a
shifting focus towards cryptocurrencies, marketplace and fintech platforms facilitating financial and household services
23
Acquisitions – sector overview
0% Number of acquisitions by sector
0% 0% 0%

17% Software & Services = 2

Transactions = 2
33% Hardware & Infrastructure = 1
Media = 1
Ecommerce = 0
17%
Marketing = 0
Mobile & Apps = 0
Games = 0

33%

§ Total number of acquisitions in SEA decreased by 67% from Q3 2017 to Q3 2018, from 18 transactions down to 6 transactions

§ Marketing experienced the largest decrease in activities with no acquisitions for the quarter, down from five acquisitions in Q3
2017, followed by Hardware & Infrastructure decreasing from four transactions to just one transaction

24
For lists of deals, investments, and acquisitions, by
geography and sector, visit InternetDealBook.com

Please contact Tim Veron for further information: tim.veron@rightclickcapital.com

Internet DealBook
InternetDealBook.com