Financial Technology (FinTech) M&A Update · 2021. 5. 11. · 4 U.S. M&A activity remains strong with over 40 FinTech M&A transactions in Q3 2017 and the top 7 transactions worth

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October 2017

Financial Technology (FinTech) M&A Update

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Market Overview

The financial technology (FinTech) sector continues to see a number of new companies enter the market and challenge established market players with new and innovative solutions. This in turn is driving significant investment in the sector. M&A activity continues to remain robust for later stage FinTech players.

Start-ups focused on new payment solutions and peer-to-peer (P2P) lending in particular are challenging financial institutions’ existing business models. Valuations for Payment Services companies have increased the most since our Q2 report, followed by Bank Technology providers, while Financial Systems Software and Payment Processers valuations have decreased.

• Changing consumer behaviors continue to drive technological advancements that are reshaping the financial services industry. The unrelenting development of mobile devices, modern methods of data analysis (big data), social media and the migration of data into the Cloud have created opportunities for new FinTech compa-nies looking to complement and challenge existing financial services providers. New regulation and strict bank lending requirements have come at a time of general consumer disillusionment with traditional banking products, meaning they are willing to turn to new banking products and technologies.

• Investment activity in the FinTech sector continues to acceler-ate. Global FinTech investment has increased considerably in the last 18 months. A number of start-up companies in the payments and P2P lending subsectors are using these funds to accelerate growth, de-velop new products, move into new markets or expand their global presence.

• M&A activity remains robust with over 40 FinTech M&A trans-actions in Q3 2017. Innovative companies in the payments and P2P lending spaces have triggered significant M&A activity in the last cou-ple of years. Established market participants have targeted new gen-eration payment companies to integrate new technology and prod-ucts to their offerings. New market entrants have also been active buyers in the payments and P2P lending spaces as they look to move into new markets and expand internationally.

• M&A outlook is favorable. Further consolidation is likely between market participants. The growing fragmentation in the FinTech sec-tor continues to drive M&A activity. Investor exits through sales and initial public offerings (IPOs) are also likely to increase.

TABLE OF CONTENTS:

• M&A Trends

• Case Study

• Valuation Trends

• Public Comparables

• Recent Transactions

CONTACTS:

David Francione Managing [email protected]

Gary MoonManaging Director and Head of Technology, Media & [email protected]

Brad SportackAssociate [email protected]

www.headwatersmb.com

KEY CONCLUSIONS FROM THIS REPORT

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Innovations such as new payment solutions, smartphones, the Cloud, big data analytics and social media continue to create opportunities for financial services companies as they look to deliver new services to customers.

These developments come at a time of general disillusionment with traditional banking products, particularly amongst young people. The U.S. Millennial Disruption Index reports that:

• 33 percent of respondents believe banks will not be needed in five years’ time.

• 70 percent say the way items are paid for will be totally different in five years’ time.

• 73 percent would be more excited about a new offering in financial services from Google, Amazon, Apple, PayPal or Square than from their own bank.

• Nearly half are counting on tech start-ups to overhaul the way banks work.

For disintermediation to happen on a mass scale, much will depend on whether new financial technology can gain the trust of users and provide the same level of guarantee for financial settlement as the current financial system. This trend continues to offer new market entrants an opportunity to win significant market share. Estimates suggest between 25-35% of banking revenues are vulnerable to digital disruption within the next five years, with income from payments and lending at greater risk.

CHANGING CONSUMER BEHAVIOR DRIVING TECHNOLOGICAL ADVANCEMENT

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U.S. M&A activity remains strong with over 40 FinTech M&A transactions in Q3 2017 and the top 7 transactions worth over $18B. Financial institutions and large technology service providers have been actively acquiring mature companies to continue to gain economies of scale or investing/partnering with disruptive technology providers of the future to bring new, more efficient ways of conducting business. Q3 2017 witnessed over 40 Fintech M&A Transactions with the top 7 worth over $18B.

Top 7 Q3 Buyers Buyer description Targets Target description

Provides electronic payment processing services to merchants and financial institutions in the U.S.

Provides payments processing technology and solutions for merchant customers

Private equity and investment advisory firms Provides digital payment and transaction-related solutions to businesses and consumers

Provides payment technology services globally Provides cloud based participant management, and registration software

Provides trading, clearing, exchange technology, listing, information and public company services

Provides cloud-based solutions to the institutional investing community worldwide

Develops, and markets computer software for financial advisors

Provides cloud-based wealth management technol-ogy and advisory services

Provides software products and services that assist in finding and sharing business information

Provides forensic security solutions in the United States, Europe, Asia

Provides software solutions and services for the mortgage campanies

Provides sales lead software and that help business track performance

Source: Pitchbook

The Headwaters MB FinTech index, which tracks a basket of the top 50 public FinTech companies by revenue, is up 25% thru September 30th compared to 20% for the Nasdaq and 12% for S&P. The Payment Services sector was up over 60%, leading our FinTech Index’s outperformance.

HEADWATERS MB FINTECH INDEX

Top 50 FinTech companies by revenue (of those tracked by Headwaters MB index), and their relative % change in price to 0%Source: Capital IQ

M&A TRENDS

-5%

0%

5%

10%

15%

20%

25%

30%

Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17

S&P 500 (^SPX) - Index Value FinTech Index - 2017 - Index ValueDow Jones Industrial Average (^DJI) - Index Value NASDAQ Composite Index (^COMP) - Index Value

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CASE STUDY: MHC SOFTWARE MHC SOFTWARE HAS BEEN ACQUIRED BY O2 INVESTMENT PARTNERS

“Headwaters worked tirelessly and provided us with professional well thought out guid-ance every step of the way to help us find the appropriate partner that shares our core values.” said John Shields, President of MHC. “Their FinTech team really understood not only our products and business model but our technology and our value differentiators that really made a difference in our process.”

Industry Trends Automating the B2B invoice & workflow (document management) process is over a $700B industry globally, growing 10% to 20% a year.

There is a tremendous amount of capital that has been invested globally in automating the B2B AP process. The invoice is at the heart of the trend to reduce or eliminate paper and improve the workflow associated with processing, managing and paying vendor invoices more efficiently via less costly electronic mediums such as ACH and VCards.

MHC Software marks the second automated AP eInvoice technology transaction that Head-waters has been involved in this year. The first being Paperless based in Chile, which was acquired by Sovos, a Boston-based firm.

Client Overview MHC Software is an automated AP and eInvoice solution provider to large enterprises in a variety of industries including healthcare, public sector & financial services, predominantly integrating with the Infor (Lawson) ERP eco-system.

Transaction Overview The Company is privately-held based outside of Minneapolis with shareholders approaching retirement age that saw significant growth potential in the company’s current target market as well as adjacent markets. Headwaters was engaged to by the Com-pany to run a sell-side process to find a partner that would help grow the company and provide the owners liquidity.

Value add Headwaters’ FinTech team found a partner who understands the industry and shares MHC’s vision. O2 shares the same long-term view of the company and sector, and will help facility MHC’s next stage of development.

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PUBLIC COMPANY VALUATION TRENDS BY SUBSECTOR

The mean revenue multiples for Bank Technology Providers have increased 30% over the last 5 years from 4.3x to 5.6x and have increased from 5.0x to 5.6x over the past 12 months.

The mean EBITDA multiples have increased by 56% over the same period from 12.2x to 23.7x and have increased from 17.0x to 23.7x over the past 12 months.

The mean EBITDA multiple increased by 12% and the mean revenue multiple increased by over 10% from our Q2 report.

BANK TECHNOLOGY

PUBLIC COMPANY SUBSECTOR VALUATION TRENDS

5.6x5.0x

4.6x4.3x

23.7x

17.0x15.3x 15.2x

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

LTM 1 yr. 3 yr. 5 yr.0

1

2

3

4

5

6

EV / Revenue EV / EBITDA

Date Target/Issuer Buyers/Investors Implied Enterprise Value ($M)

Implied EV/Revenue

Implied EV/EBITDA

*09/28/2017 WorkWave, LLC Industrial and Financial Systems, IFS AB (publ) na na na

*09/25/2017 Folio Dynamics Inc. Envestnet, Inc. (NYSE:ENV) 195.0 na na

*09/12/2017 BDNA Corporation Flexera Software LLC na na na

*09/07/2017 Gambit Financial Solutions SA BNPP Asset Management France na na na

*09/05/2017 eVestment Alliance, LLC Nasdaq, Inc. (NasdaqGS:NDAQ) 705 na na

09/04/2017 Valldata Services Limited The Woods Group Limited na na na

*08/31/2017 Velocify, Inc. Ellie Mae, Inc. (NYSE:ELLI) 128 na na

08/22/2017 Security Card Services, LLC BluePay, Inc. na na na

08/21/2017 Dovetail Group Limited Fiserv, Inc. (NasdaqGS:FISV) na na na

08/10/2017 InSure Vision Technologies, LLC SuretyWave, LLC na na na

08/10/2017 Bidvest Merchant Services Bidvest Bank Limited na na na

08/09/2017 Data Intensity, LLC EQT Partners AB na na na

08/08/2017 Datablink Inc. WatchGuard Technologies, Inc. na na na

08/07/2017 VersionOne, Inc. CollabNet, Inc. na na na

08/03/2017 Active Network, LLC Global Payments Inc. (NYSE:GPN) 1,207 na na

07/26/2017 Guidance Software, Inc. Open Text Corporation (NasdaqGS:OTEX) 245 2.26x na*07/26/2017 VÖB-ZVD Processing GmbH, Girocard Network Operations SIX Payment Services Ltd na na na07/25/2017 First Data Lietuva Uab and First Data Latvia Sia Worldline S.A. (ENXTPA:WLN) 85 3.17x na

*07/21/2017 Paysafe Group Plc (LSE:PAYS) CVC Capital Partners Limited; The Blackstone Group L.P. 4,014 3.85x 15.11x

07/18/2017 iParse, LLC Urban FT, Inc. na na na

*07/17/2017 Digital River World Payments AB Worldline S.A. (ENXTPA:WLN) na na na

07/14/2017 Spindle, Inc. (OTCPK:SPDL) - na na na

07/06/2017 Nostrum Group Limited Equiniti Group plc (LSE:EQN) na na na

*07/05/2017 Worldpay Group plc (LSE:WPG) Vantiv, Inc. (NYSE:VNTV) 11,527 7.53x 19.73x

07/05/2017 Archway Technology Partners, LLC SEI Investments Co. (NasdaqGS:SEIC) 88 4.92x 24.44x

07/03/2017 ABIT GmbH Marlin Equity Partners, LLC na na na

*Indicates transactions that have not closed as of 9/30/2017Source: Capital IQ

Source: Capital IQ

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The mean revenue multiples for Financial Systems Software increased by 17%, from 4.1x to 4.8x over the last 5 years, increasing from 4.6x to 5.8x over the past 12 months.

The mean EBITDA multiples decreased by 5% from 27.5x to 26.0x over the same 5 year period and decreased from 32.5x to 26.0x over the past 12 months.

The mean EBITDA multiple decreased by 20%, the biggest decline in our FinTech coverage and the mean revenue multiple increased by about 3% from our Q2 report.

FINANCIAL SYSTEMS SOFTWARE

4.8x

4.6x4.5x

4.1x

26.0x

32.5x29.6x

27.5x

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x

35.0x

LTM 1 yr. 3 yr. 5 yr.3.6

3.8

4

4.2

4.4

4.6

4.8

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The mean revenue multiples for Risk Management Providers have increased 4% over the last 5 years from 4.8x to 5.0x and increased from 4.5x to 5.0x over the last 12 months.

The mean EBITDA multiples have decreased by 50% over the same period from 45.6x to 23.1x and have increased from 17.5x to 23.1x over the past 12 months.

The mean EBITDA multiple increased by 1.6% and the mean revenue multiple increased by over 6.3% from our Q2 report.

RISK MANAGEMENT PROVIDERS

5.0x

4.5x

4.7x

4.8x

23.1x17.5x

50.8x45.6x

0.0x

10.0x

20.0x

30.0x

40.0x

50.0x

60.0x

LTM 1 yr. 3 yr. 5 yr.4.14.24.34.44.54.64.74.84.955.1


The mean revenue multiples for Investment Re-search Data providers increased by 4%, from 5.4x to 5.6x over the last 5 years and increased from 5.3x to 5.6x in the last 12 months.

The mean EBITDA multiples for this group have re-mained relatively constant during the same 5 year period and have increased from 24.8x to 25.7x in the last 12 months.


INVESTMENT RESEARCH DATA

5.6x

5.3x

5.1x

5.4x

25.7x

24.8x

23.4x

25.8x

22.0x

22.5x

23.0x

23.5x

24.0x

24.5x

25.0x

25.5x

26.0x

LTM 1 yr. 3 yr. 5 yr.4.9

5

5.1

5.2

5.3

5.4

5.5

5.6

5.7

EV / Revenue EV / EBITDANote: LTM, 1 yr, 3 yr, 5 yr perWiods represent valuation metrics as of 10/1/2017, 10/1/2016, 10/1/2014, 10/1/2012, respectively.

Source: Capital IQ

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The mean revenue multiples for Financial Informa-tion/Data Providers have increased 18% over the last 5 years from 3.9x to 4.6x and have increased slightly from 4.5x to 4.6x over the last 12 months.

The mean EBITDA multiples have increased by 12% over the last 5 years from 12.9x to 14.5x and have in-creased slightly over the last 12 months, going from 14.4x to 14.8x.


FINANCIAL INFORMATION/DATA PROVIDERS

The mean revenue multiples for Payment Processors decreased by 32%, from 5.9x to 4.0x over the last 5 years, with a drop occurring in the last 12 months from 4.0x to 4.0x.

The mean EBITDA multiple for this group decreased by 14%, from 16.8x to 14.5x over the same 5 year period and increased slightly from 14.3x to 14.5x in the last 12 months.

The mean EBITDA multiple increased by 3.8% and the mean revenue multiple decreased by over 15% from our Q2 report.

PAYMENT PROCESSORS

The mean revenue multiples for Payment Technol-ogy Providers have increased by 10% over the last 5 years from 4.0x to 4.4x and increased from 3.9x to 4.4x over the last 12 months.

The mean EBITDA multiples increased by 36% over the last 5 years from 17.7x to 24.0x and increased from 18.9x to 24.0x over the last 12 months.


PAYMENT TECHNOLOGY PROVIDERS

4.6x4.5x

4.2x

3.9x

14.5x14.4x

13.9x

12.9x

12.0x

12.5x

13.0x

13.5x

14.0x

14.5x

15.0x

LTM 1 yr. 3 yr. 5 yr.3.4

3.6

3.8

4

4.2

4.4

4.6

4.8


4.0x

5.0x

6.0x 5.9x

14.5x14.3x 14.3x

16.8x

13.0x

13.5x

14.0x

14.5x

15.0x

15.5x

16.0x

16.5x

17.0x


1

2

3

4

5

6

7


4.4x3.9x 3.7x

4.0x24.0x

18.9x17.4x 17.7x

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x


1

2

3

4

5

EV / Revenue EV / EBITDANote: LTM, 1 yr, 3 yr, 5 yr perWiods represent valuation metrics as of 10/1/2017, 10/1/2016, 10/1/2014, 10/1/2012, respectively.

Source: Capital IQ

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The mean revenue multiples for Card Solutions in-creased by 3%, from 7.1x to 7.3x over the last 5 year time period and increased slightly over the last 12 months

The mean EBITDA multiple for this group increased by 25% over the last 5 years from 15.9x to 19.8x and from 17.6x to 19.8x over the last 12 months.


CARD SOLUTIONS

The mean revenue multiples for Payment Services increased by 46%, from 1.3x to 1.9x over the last 5 year time period with an increase of 25% over the last 12 months.

The mean EBITDA multiple for this group increased by 68% over the last 5 years from 6.6x to 11.1x and from 8.7x to 11.1x over the last 12 months.


PAYMENT SERVICES

7.3x

7.2x

7.3x

7.1x

19.8x17.6x 16.7x 15.9x

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

LTM 1 yr. 3 yr. 5 yr.6.95

7

7.05

7.1

7.15

7.2

7.25

7.3


Note: LTM, 1 yr, 3 yr, 5 yr perWiods represent valuation metrics as of 10/1/2017, 10/1/2016, 10/1/2014, 10/1/2012, respectively. Source: Capital IQ

1.9x

1.5x1.3x 1.3x

11.1x

8.7x

6.9x 6.6x

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x


0.5

1

1.5

2


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PUBLIC COMPARABLES($USD in millions, except per share data)USD Currency

Stock Price % of 52-Week Market Enterprise LTM LTMCompany Name Ticker 9/30/2017 High Low Cap Value Revenue EBITDA Revenue EBITDA

Bank TechnologyFiserv, Inc. FISV $128.96 99.5% 139.0% $27,142 $31,584 $5,591 $1,749 5.6x 18.1xJack Henry & Associates, Inc. JKHY $102.79 93.7% 130.1% $7,960 $7,895 $1,431 $447 5.5x 17.7xTemenos Group AG TEMN $101.96 98.3% 162.5% $7,156 $7,452 $668 $179 11.2x 41.6xDélice Holding SA DH $7.24 95.0% 134.7% $397 $422 $325 $37 1.3x 11.3xDeluxe Corporation DLX $72.96 96.1% 122.7% $3,528 $4,214 $1,912 $453 2.2x 9.3xQ2 Holdings, Inc. QTWO $41.65 99.6% 165.1% $1,720 $1,641 $173 ($17) 9.5x NMBottomline Technologies (de), Inc. EPAY $31.83 98.5% 147.9% $1,286 $1,343 $349 $30 3.8x 44.6x

Median $3,528 $4,214 $668 $179 5.5x 17.9xMean $7,027 $7,793 $1,493 $411 5.6x 23.7x

LTMEV as a Multiple of:

BPO (Business Process Outsourcing)Genpact Limited G $28.75 90.0% 127.1% $5,546.0 $6,380.9 $2,624.2 $438.3 2.4x 14.6xExlService Holdings, Inc. EXLS $58.32 97.5% 138.9% 1,967.8 1,776.2 720.6 101.1 2.5x 17.6xWNS (Holdings) Limited WNS $36.50 97.5% 147.1% 1,845.0 1,767.8 634.7 86.5 2.8x 20.4x

Median $1,967.8 $1,776.2 $720.6 $101.1 2.5x 17.6xMean $3,119.6 $3,308.3 $1,326.5 $208.6 2.6x 17.5x

Card SolutionsVisa Inc. V $105.24 98.5% 140.0% $240,659.2 $251,885.2 $17,764.0 $12,168.0 14.2x 20.7xMastercard Incorporated MA $141.20 98.3% 141.9% 150,363.5 148,826.5 11,423.0 6,605.0 13.0x 22.5xAmerican Express Company AXP $90.46 99.7% 152.0% 79,964.8 105,380.0 29,476.0 NM 3.6x NMDiscover Financial Services DFS $64.48 86.7% 119.6% 24,009.3 51,698.0 7,168.0 NM 7.2x NMAlliance Data Systems Corporation ADS $221.55 83.2% 112.1% 12,292.4 32,053.3 7,413.9 1,465.0 4.3x 21.9xFleetCor Technologies, Inc. FLT $154.77 87.7% 127.4% 14,220.1 17,493.6 2,061.0 1,111.6 8.5x 15.7xWEX Inc. WEX $112.22 91.3% 115.4% 4,814.7 6,981.5 1,173.8 377.3 5.9x 18.5xBlackhawk Network Holdings, Inc. HAWK $43.80 93.8% 147.9% 2,481.5 2,817.5 2,012.5 144.8 1.4x 19.5x

Median $19,114.7 $41,875.6 $7,291.0 $1,288.3 6.6x 20.1xMean $66,100.7 $77,141.9 $9,811.5 $3,645.3 7.3x 19.8x

Investment Research DataMSCI Inc. MSCI $116.90 98.6% 152.8% $10,527.9 $11,854.0 $1,198.5 $607.2 9.9x 19.5xMorningstar, Inc. MORN $84.99 99.3% 125.5% 3,614.6 3,505.0 847.0 228.3 4.1x 15.4xEnvestnet, Inc. ENV $51.00 98.1% 165.6% 2,245.0 2,477.5 629.8 56.6 3.9x 43.7xFinancial Engines, Inc. FNGN $34.75 76.0% 139.0% 2,194.6 2,024.7 458.2 84.1 4.4x 24.1x

Median $2,929.8 $2,991.2 $738.4 $156.2 4.3x 21.8xMean $4,645.5 $4,965.3 $783.4 $244.1 5.6x 25.7x

($USD in millions, except per share data)USD Currency



Financial InformationTrifast plc TRI $2.79 90.9% 137.8% $335.5 $344.1 $233.6 $26.0 1.5x 13.2xS&P Global Inc. SPGI $156.31 98.7% 145.8% 40,171.7 42,514.7 5,800.0 2,663.0 7.3x 16.0xMoody's Corporation MCO $139.21 99.5% 148.9% 26,589.1 28,321.3 3,834.9 1,838.7 7.4x 15.4xEquifax Inc. EFX $105.99 72.1% 118.3% 12,758.3 15,247.1 3,294.3 1,220.4 4.6x 12.5xWolters Kluwer N.V. WKL $46.21 97.4% 127.6% 13,091.7 15,780.5 5,053.1 1,342.8 3.1x 11.8xPearson plc LSE:PSON $8.21 73.0% 110.9% 6,694.3 9,099.6 6,146.9 1,067.6 1.5x 8.5xTransUnion TRU $47.26 95.6% 163.4% 8,596.6 10,936.5 1,803.2 636.7 6.1x 17.2xInforma plc INF $9.01 90.7% 140.0% 7,420.4 9,522.8 2,095.4 658.3 4.5x 14.5xFactSet Research Systems Inc. FDS $180.11 97.8% 119.3% 7,065.4 7,413.2 1,221.2 400.4 6.1x 18.5xThe Dun & Bradstreet Corporation DNB $116.41 85.0% 115.9% 4,302.2 5,619.7 1,717.1 427.7 3.3x 13.1xEbix, Inc. EBIX $65.25 99.8% 124.5% 2,052.2 2,337.7 321.1 114.4 7.3x 20.4xBankrate, Inc. RATE $13.95 97.9% 196.5% 1,240.3 1,348.7 477.0 101.2 2.8x 13.3x

Median $7,242.9 $9,311.2 $1,949.3 $647.5 4.6x 13.9xMean $10,859.8 $12,373.8 $2,666.5 $874.8 4.6x 14.5x

Financial Systems Software / ProcessingFidelity National Information Services, Inc. FIS $93.39 99.6% 127.5% $31,044.0 $40,084.0 $9,351.0 $2,499.0 4.3x 16.0xIntuit Inc. INTU $142.14 96.9% 137.7% 36,241.9 35,952.9 5,177.0 1,626.0 6.9x 22.1xThe Sage Group plc SGE $9.37 86.5% 117.4% 10,110.2 10,563.4 2,160.3 619.0 4.9x 17.1xSS&C Technologies Holdings, Inc. SSNC $40.15 99.1% 141.2% 8,248.0 10,456.6 1,602.9 580.9 6.5x 18.0xBroadridge Financial Solutions, Inc. BR $80.82 98.5% 135.0% 9,413.5 10,244.4 4,142.6 704.7 2.5x 14.5xDST Systems, Inc. DST $54.88 87.2% 116.1% 3,320.7 3,827.0 1,847.2 404.5 2.1x 9.5xGuidewire Software, Inc. GWRE $77.86 95.6% 158.3% 5,840.3 5,267.1 514.3 47.3 10.2x 111.3xSimCorp A/S CPSE:SIM $61.07 85.7% 124.0% 2,413.4 2,409.7 356.9 82.1 6.8x 29.4xFidessa group plc FDSA $30.13 84.0% 111.2% 1,159.6 1,064.4 456.1 83.3 2.3x 12.8xLinedata Services S.A. ENXTPA:LIN $47.87 69.9% 112.3% 343.4 390.3 198.9 42.3 2.0x 9.2x

Median $7,044.1 $7,755.7 $1,725.1 $492.7 4.6x 16.6xMean $10,813.5 $12,026.0 $2,580.7 $668.9 4.8x 26.0x

Payment Hardware SolutionsNCR Corporation NCR $37.52 75.2% 125.8% $4,558.7 $8,268.7 $6,550.0 $881.0 1.3x 9.4xIngenico Group - GCS ING $94.79 80.8% 117.5% 5,899.6 6,109.9 2,738.5 506.5 2.2x 12.1xVeriFone Systems, Inc. PAY $20.28 94.4% 135.7% 2,275.4 3,023.5 1,858.6 217.7 1.6x 13.9xDiebold Nixdorf, Incorporated DBD $22.85 71.7% 127.3% 1,725.4 3,590.0 4,463.4 243.0 0.8x 14.8x

Median $3,417.1 $4,850.0 $3,601.0 $374.8 1.4x 13.0xMean $3,614.8 $5,248.0 $3,902.6 $462.1 1.5x 12.5x

Source: Capital IQ

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($USD in millions, except per share data)USD Currency



Payment Hardware SolutionsNCR Corporation NCR $37.52 75.2% 125.8% $4,558.7 $8,268.7 $6,550.0 $881.0 1.3x 9.4xIngenico Group - GCS ING $94.79 80.8% 117.5% 5,899.6 6,109.9 2,738.5 506.5 2.2x 12.1xVeriFone Systems, Inc. PAY $20.28 94.4% 135.7% 2,275.4 3,023.5 1,858.6 217.7 1.6x 13.9xDiebold Nixdorf, Incorporated DBD $22.85 71.7% 127.3% 1,725.4 3,590.0 4,463.4 243.0 0.8x 14.8x

Median $3,417.1 $4,850.0 $3,601.0 $374.8 1.4x 13.0xMean $3,614.8 $5,248.0 $3,902.6 $462.1 1.5x 12.5xPayment ProcessingFirst Data Corporation FDC $18.04 94.0% 139.5% $16,650.6 $37,429.6 $7,910.0 $2,789.0 4.7x 13.4xGlobal Payments Inc. GPN $95.03 96.8% 147.0% 14,491.0 18,146.8 4,189.5 1,148.0 4.3x 15.8xVantiv, Inc. VNTV $70.47 96.3% 129.6% 11,457.9 15,183.4 3,796.1 880.0 4.0x 17.3xTotal System Services, Inc. TSS $65.50 92.7% 141.7% 12,067.6 14,792.2 4,686.2 941.9 3.2x 15.7xEuronet Worldwide, Inc. EEFT $94.79 95.2% 134.4% 4,979.7 4,785.2 2,053.8 345.4 2.3x 13.9xCardtronics plc CATM $23.01 41.1% 100.8% 1,050.5 1,970.6 1,380.8 304.9 1.4x 6.5xEVERTEC, Inc. EVTC $15.85 81.2% 112.0% 1,147.2 1,719.3 401.1 157.7 4.3x 10.9xPlanet Payment, Inc. PLPM $4.29 92.5% 156.0% 214.0 206.9 52.8 12.1 3.9x 17.1xOneview Healthcare PLC ONE $2.20 38.5% 100.0% 113.6 87.2 7.1 (27.0) 12.2x NMJetPay Corporation JTPY $1.85 58.0% 127.6% 29.0 90.9 70.2 4.1 1.3x 21.9xRichter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt.RC $0.00 NA NA 4,631.3 4,403.5 1,584.1 355.8 2.8x 12.4x

Median $4,631.3 $4,403.5 $1,584.1 $345.4 3.9x 14.8xMean $6,075.7 $8,983.2 $2,375.6 $628.4 4.0x 14.5x

Payment ServicesThe Western Union Company WU $19.20 84.6% 104.4% $8,908.7 $11,472.3 $5,430.8 $1,350.9 2.1x 8.5xMoneyGram International, Inc. MGI $16.11 89.9% 276.3% 873.4 1,640.0 1,625.1 226.7 1.0x 7.2xGreen Dot Corporation GDOT $49.58 98.7% 231.1% 2,501.6 1,967.3 792.8 112.3 2.5x 17.5x

Median $2,501.6 $1,967.3 $1,625.1 $226.7 2.1x 8.5xMean $4,094.6 $5,026.5 $2,616.2 $563.3 1.9x 11.1x

Payment Technology SolutionsPayPal Holdings, Inc. PYPL $64.03 98.1% 168.2% $76,989.5 $67,824.5 $11,759.0 $2,259.0 5.8x 30.0xACI Worldwide, Inc. ACIW $22.78 92.4% 150.8% 2,692.7 3,295.5 1,031.8 173.1 3.2x 19.0xSquare, Inc. SQ $28.81 99.3% 264.8% 11,054.3 10,484.0 1,904.0 (41.2) 5.5x NMQiwi plc QIWI $16.94 63.8% 146.0% 1,046.3 749.2 316.1 88.7 2.4x 8.4xCass Information Systems, Inc. CASS $63.44 84.8% 120.4% 710.8 409.7 131.2 39.5 3.1x 10.4xMitek Systems, Inc. MITK $9.50 88.4% 180.6% 319.1 280.8 42.2 5.4 6.7x 52.1x

Median $1,869.5 $2,022.3 $673.9 $64.1 4.4x 19.0xMean $15,468.8 $13,840.6 $2,530.7 $420.8 4.4x 24.0x

Real Estate InformationCoStar Group, Inc. CSGP $268.25 93.2% 149.7% $9,580.2 $9,320.4 $894.7 $220.4 10.4x 42.3xZillow Group, Inc. ZG $40.15 78.9% 128.8% 7,387.4 7,164.7 964.8 35.1 7.4x NMCoreLogic, Inc. CLGX $46.22 96.3% 133.6% 3,896.7 5,449.0 1,912.6 404.8 2.8x 13.5xReis, Inc. REIS $18.00 76.2% 112.9% 207.2 188.3 46.9 6.6 4.0x 28.4x

Median $5,642.1 $6,306.9 $929.8 $127.8 5.7x 28.4xMean $5,267.9 $5,530.6 $954.8 $166.7 6.2x 28.0x

Real Estate Mortgage TechnologyOcwen Financial Corporation OCN $3.44 55.9% 162.3% $450.2 $6,890.2 $1,316.5 $352.8 5.2x 19.5xAltisource Portfolio Solutions S.A. ASPS $25.87 55.1% 160.0% 466.9 748.7 982.5 148.8 0.8x 5.0x

Median $458.5 $3,819.4 $1,149.5 $250.8 3.0x 12.3xMean $458.5 $3,819.4 $1,149.5 $250.8 3.0x 12.3x

Risk Management / BICognizant Technology Solutions Corporation CTSH $72.54 99.4% 149.6% $42,843.8 $39,456.8 $14,131.0 $2,775.0 2.8x 14.2xVerisk Analytics, Inc. VRSK $83.19 94.4% 110.0% 13,689.4 15,948.5 2,030.0 941.6 7.9x 16.9xOpen Text Corporation OTEX $32.29 91.7% 110.2% 8,532.3 10,659.8 2,291.1 631.7 4.7x 16.9xFair Isaac Corporation FICO $140.50 95.6% 128.0% 4,303.5 4,784.6 914.8 202.2 5.2x 23.7xNICE Ltd. NICE $79.75 97.2% 117.8% 4,812.8 4,895.1 1,178.2 250.8 4.2x 19.5xTableau Software, Inc. DATA $74.89 98.2% 180.9% 5,923.4 4,930.5 869.5 (93.9) 5.7x NMPegasystems, Inc. PEGA $57.65 88.9% 202.8% 4,475.1 4,295.0 803.6 75.2 5.3x 57.1xProgress Software Corporation PRGS $38.17 99.1% 145.5% 1,843.2 1,774.8 399.2 133.4 4.4x 13.3x

Median $5,368.1 $4,912.8 $1,046.5 $226.5 4.9x 16.9xMean $10,802.9 $10,843.1 $2,827.2 $614.5 5.0x 23.1x

OverallMedian $3,527.9 $4,403.5 $1,149.5 $226.7 4.4x 16.9xMean $11,411.5 $13,146.1 $2,693.7 $704.6 4.3x 19.4x

PUBLIC COMPARABLES CONT.

Source: Capital IQ

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*Certain transactions executed by Headwaters bankers at prior firms

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About Headwaters MB:Headwaters MB is an independent, middle market investment banking firm providing strategic merger and acquisition advice, capital raising and special situations advisory. Named “Investment Bank of the Year” by major industry orga-nizations in 2014 - 2016, Headwaters MB is headquartered in Denver, CO, with six regional offices across the United States and partnerships with 18 firms covering 30 countries. For more information, visit www.headwatersmb.com.

Our team has extensive operational and transaction experience for middle-market companies in the FinTech, Technology, Media & Telecom sectors.

Gary MoonManaging Director and Head of Technology, Media & [email protected]

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Financial Technology (FinTech) M&A Update · 2021. 5. 11. · 4 U.S. M&A activity remains strong with over 40 FinTech M&A transactions in Q3 2017 and the top 7 transactions worth