1ST HALF 2016 KEY HIGHLIGHTS• The largest deal in 1st Half 2016 was Apollo Education Group

Inc.’s announced acquisition by a consortium of investors for

$1.1 billion.

• The most active acquirer year-to-date, either purchased directly

or through an affi liated business, was Vista Equity Partners with

fi ve industry transactions: HAIKU Learning Systems, Inc.,

TIENET, and Interactive Achievement, Inc. through PowerSchool

Group in the K-12 Media and Tech segment; TeacherMatch

through PeopleAdmin in the K-12 Media and Tech segment; and

JumpForward through The Active Network in the Higher-Ed

Media and Tech segment. Also of note, Vista Equity acquired

PowerSchool Group for $350 million in 2015.

1ST HALF 2016 KEY TRENDS• Total transaction volume in 1st Half 2016 decreased by 18

percent over 2nd Half 2015, from 230 to 188. Overall volume

declined three percent on a year-over-year basis.

• Strategic volume moved downward from 176 in 2nd Half 2015

to 138 in 1st Half 2016. Private equity backed volume remained

fairly consistent during this timeframe, from 54 to 50.

• Total transaction value in 1st Half 2016 fell by 65 percent over

2nd Half 2015, from $11.88 billion to $4.16 billion. Overall value

decreased 38 percent on a year-over-year basis.

• The median revenue multiple increased slightly from 1.9x in 2nd

Half 2015 to 2.1x in 1st Half 2016.

• The segment with the largest increase in volume in 1st Half

2016 over 2nd Half 2015 was K-12 Media and Tech with a

47 percent rise, from 32 to 47 transactions.

M&A MARKET OVERVIEWBerkery Noyes tracked 942 Education transactions between 2014

and 1st Half 2016, of which 205 disclosed fi nancial terms, and

calculated the aggregate transaction value to be $26.65 billion.

Based on known transaction values, we project the values of 737

undisclosed transactions to be $7.47 billion, totaling $34.12 billion

worth of transactions tracked over the past two and a half years.

Disclosed median enterprise value multiples for all segments

combined in this report during the last 30 months were 2.0x revenue

and 8.6x EBITDA.

EDUCATION INDUSTRY1ST HALF 2016 :: Mergers and Acquisitions Trend Report

Presented by Berkery Noyes 1

Figure 1. 2014-2016 value and volume comparison.

Figure 2. 2014-2016 median: value and revenue comparison.

2

Strategic vs. Financial Comparison

Transactions Involving an Online Component

Figure 5. 2014-2016 acquirer type comparison by half year.Figure 4. 2014-2016 value and volume comparison by transaction type.

Note: Financial transactions are those financed by private equity, venture capital, and other investment firms. This includes acquisitions by portfolio companies of the investment firms.

Transaction Percentages of Online Targets

Figure 3. Percentage of total Education Industry transactions where the target company conducts the majority of their business online. The total percentages are measured by half year from January 1, 2009 through June 30, 2016.

Online Targets Other Targets

Transaction Volume by Segment :: January 1, 2014 – June 30, 2016

3©2016 Berkery Noyes

Distribution Table

Figure 7. Presents the data depicted in the bell curve histogram.

Note: The projected number column is rounded and may produce insignificant errors in the total sum.

Median EV/Revenue Multiples By Size

Figure 6. Presents the median enterprise value/revenue multiples paid for companies in the Education Industry from January 1, 2014 to June 30, 2016 based on publicly available data.

Figure 8. Presents transaction volume by market segment within the Education Industry from January 1, 2014 through June 30, 2016.

Purchaser Analysis

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RECENT EDUCATION TRANSACTIONS

4 ©2016 Berkery Noyes

Founded in 1980, Berkery Noyes is a leading independent investment bank serving the information, software, marketing, and technology industries. Th e fi rm has initiated, managed, and

closed more than 475 merger and acquisition transactions for privately held and publicly traded companies in the healthcare,

fi nancial services, education, and entertainment markets.

Berkery Noyes is unique among investment banking fi rms in that we combine independent strategic research and actionable

intelligence with senior banking expertise.

Berkery Noyes Securities LLC assists middle market companies with raising growth capital in the debt and equity markets.

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All charts in this report are based on data gathered by Berkery Noyes’ research department. All time period statistics are based

on the transaction announcement date. Th e information contained herein is of a general nature and is not intended to address the circumstances of any particular company, individual, or entity.

For current intelligence on Mergers and Acquisitions activity in the Information Industry please visit our online service at

www.mandasoft.com

The DNA of M&A

MANAGING DIRECTORS

PETER YOONEducation Group

MARY JO ZANDYMedia, Education, Software & Online

VINEET ASTHANAMedia & Marketing Services Group

JOHN GUZZO FinTech Group

JONATHAN KRIEGERHealthcare Group

THOMAS O’CONNORHealthcare Group

DICK O’DONNELLFinance Group

PETER OGNIBENEFinTech Group

JEFFREY SMITHHealthcare Group

PARTNERS

JOSEPH BERKERYChief Executive Offi cer

JAMES BERKERYChief Information Offi cer

HAS BEEN ACQUIRED BY

A SUBSIDIARY OF

HAS BEEN ACQUIRED BY

HAS ACQUIRED

A BUSINESS OF

HAS COMPLETED A RECAPITALIZATION OF ITS BUSINESS

HAS ACQUIRED MAJORITY OWNERSHIP FROM ITS OTHER CURRENT INVESTORS

Family Education Networkincluding

and other select assets from

HAS ACQUIRED

HAS ACQUIRED

A SUBSIDIARY OF

A PORTFOLIO COMPANY OF

HAS BEEN ACQUIRED BY

HAS ACQUIRED

RECAPITALIZATION WITH