industry overview · market 2021 us$ 302 billion cagr : 12.9% cagr : 2.8% cagr : 1.3% source:...
TRANSCRIPT
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Industry overview
Private & Confidential
11
Table Of Contents
01. Market Overview 3
02. Industry Update 8
03. CEE Region Overview 21
04. OPD Valuations 24
05. Appendices 27
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▪ Increasing demand for software development activities driven by digital transformation and productdevelopment requirements leading to demand-supply imbalance for software talent- IDC estimated that in 2014, there were only 18.5m software developers worldwide, of which only 11m were professional developers
▪ Outsourced software development represents the fastest growth within the overall softwaredevelopment landscape- Established Outsourced Product Development (OPD) players have delivered super-normal growth over the years and are expected to
continue to deliver double-digit growth rates over the coming years- Requirements for specialist talent at the most cost-effective price points have been a major driver for the development of outsourcing
and led to the emergence of high-quality best-shored delivery setups
▪ CEE region with its strong engineering talent pool, has emerged as an attractive offshoring / near-shoring destination- Europe is an untapped market with ~75% of IT work done in-house providing significant potential for near-shoring- Ability to service European clients in local languages is a key strength of the CEE region
▪ The global OPD landscape is highly fragmented with only a handful of scaled-up, pure-play OPDplayers- Pure-play OPD players attract premium valuation reflecting the higher growth potential leading to a rapid de-multiplier effect- A long tail of small niche players with core competencies in next generation technologies and vertical-specific domain expertise offer
significant potential for consolidation
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US$
61billion
Total addressable R&D market(1)
2016
US$ 232 billion
US$
112 billion
US$
93billion
US$
107billion
US$
78billion
US$
83billion
2016 2021
Software
Embedded
Mechanical
Total addressable R&DMarket(1)
2021
US$ 302 billion
CAGR : 12.9%
CAGR : 2.8%
CAGR : 1.3%
Source: Zinnov Zones (R&D spend by Global 500 companies) GSPR 2016
Note: (1)Opportunity includes market for captives, Offshore R&D service providers and Onshore R&D service providers
▪ Currently, only US$85 bnof the market opportunity is addressed, up from US$67 bn in 2015
▪ Significant potential to bridge the gap between addressed and addressable market opportunity
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39%
30%
10%
7%
4%
9%
Source: Zinnov Zones (R&D spend by Global 500 companies) GSPR 2016
Addressed ER&D marketUS$85bn (2016)
Outsourced ER&D spendUS$51bn (2016)
In-house Captive ER&D spendUS$34bn (2016)
17%
14%
20%
38%
6% 4%
India
China
Others
South Africa
Eastern Europe
Brazil
India
Rest of Asia
North America
Western Europe
Eastern Europe
Latin America
$34bn $51bn
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Tier 1: Large
Revenue> US$ 500Mn
Tier 2: Mid Size
Revenue>: US$ 100Mn -US$ 500Mn
Tier 3: Emerging
Revenue < US$ 100Mn
▪ Comprises pure-play outsourced softwaredevelopment players and large diversifiedIT services providers
▪ Recently, ER&D majors (e.g. Alten, Altran)have been investing in this marketsegment
▪ Similar profile as Tier 1 players albeit with arelatively smaller revenue profile
▪ Pure play companies typically have highergrowth rates compared to peers
▪ Smaller players focusing on catering tocertain select verticals, geographies and/orservice lines
▪ Most are pure-play outsourced softwaredevelopment firms offering nicheproducts/solutions
Note: Logos mentioned in the pyramid are only a representative list and not exhaustive list of OPD service providers
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Company HQRevenue(USDm)(1)
Employee count
Delivery locations Key offering
1,160 22,383CEE, Kazakhstan, China, India, Mexico
Product Engineering, QA, Testing, Managed Services, Digital Marketing and UX, SMAC, IoT
786 13,090CEE, Latin America, South Africa, Mexico, Vietnam, Malaysia, UK
Product Engineering, ADM, QA, PLM, UX, Big Data, BI, Mobility, DevOps, Test Automation
~500 11,000CEE, India, Latin America, US, Canada, Israel
Product Engineering, Content engineering, Big data, Analytics, DevOps, IoT
452 8,887 India, US Product Engineering, UX Design
323 6,397 Latin America, India, Uruguay Software Development, Managed Services, SMAC, UX, IoT, Gamification
~200 4,500 CEEProduct Development, Product Management, QA, IoT, DevOps, Big Data, Digital Enterprise Consulting
~200 3,000CEE, India , US, Israel, Singapore
Product Engineering, Testing, QA, Digital Services, UI/UX, Analytics
~150 3,000 CEE, Spain, PakistanProduct Engineering, App Development, Testing, QA, DevOps, IoT, UI/UX, Biomedical Engineering
~125 2,200 India, UK, New Jersey Agile development services, Testing, QA, BI
~111 2,600 CEE, KazakhstanProduct Lifecycle Management, QA, Maintenance, Managed Services, Analytics, Digital Services, Mobility
~100 5,686 India , USProduct engineering, Testing, QA, UX Design, Digital advisory & Implementation services
Sources: Company annual reports, CapitalIQ, Avendus researchNote: (1)For the listed companies – full year reported revenue 7Private & Confidential
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Growth in demand for software development by Large Enterprises as opposed to just traditional ISVs
As complexity of projects increases, vertical focused knowledge will stand to gain
▪ Projects that affect business strategy, require deeper domain expertise as opposed to just technical expertise
▪ Ongoing shift towards a digital economy, explosive growth in SMAC are driving large enterprises to invest in development ofbespoke systems in order to remain competitive
Digital engagements and transformational work presenting a large opportunity for OPD service providers
▪ Shift towards disruptive digital technologies and complex transformational engagements requires a more consultative partner todesign and implement solutions
Limited talent-pool of skilled software developers leading to demand-supply imbalances
▪ Outsourcing of software development expected to continue growing for the foreseeable future▪ Scarcity of talent, cost pressures, shorter product lifecycles, faster product upgrades and faster time-to-market pressures continue
to drive the growth in outsourcing by enterprises / ISVs and the emerging start-up / SMB community
Established players expected to continue consolidating a highly fragmented landscape
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1
3
4
5
▪ Inorganic growth is no longer an option, but a strategic imperative as established players seek capabilities, clients and scale
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10Source: IDC - 2014 Worldwide Software Developer and ICT-Skilled Worker Estimates
Diagram is conceptual and not in proportion to the data
(entire pink oval)
18 m
~3.3 BnWorld’s Labor
Force
~1.3 BnWorld’s Students
ProfessionalSoftware
Developers
Hobbyists & Citizen
SoftwareDevelopers
AllICT-Skilled Workers
Total SoftwareDevelopers
ICT Operations & Management
Skilled Workers
(outside of circle)
(circle)
11 m
29 m
(entire blue oval)
18.5 m
(outside of circle)
7.5 m
~7+ BnWorld’s Population
1
▪ Tech talent has preferred challenging work at start-ups/ technology companies as opposed to in-house IT teams of enterprises
▪ The proliferation of software languages and frameworks adds substantially to the demand-supply complexity
Preferred employer hierarchy for software talent
Start Ups
Consumer Technology Companies
Enterprise Technology Companies/ Product Companies
IT Services Companies
In House IT Teams Of Enterprises
SMEs
Worldwide software developer and ICT-skilled worker estimates
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17%
83%
Source: PWC – 2016 Global Innovation 1000 study
R&D spend by offering (US$bn)
232
188
86
280257
142
Product-based offerings Services offerings Software offerings
2010
2015
2010 2015 2020
Total R&D
Spend
Total R&D
Spend
Total R&D
Spend
Share of Software R&D within total R&D Spend (in % of total)
▪ As software increasingly defines product differentiation and customer experience, R&D spend on software has been growing significantly faster than R&D spend on services or product offerings (see right)
▪ Major R&D spenders outside the technology sector (e.g. Automotive, Financial Services, etc) are significantly contributing to Software R&D growth, and moving away from traditional product related R&D
▪ As a consequence, Software R&D spend is expected to constitute ~25% of the global R&D spend by 2020
▪ New technologies such as the Internet of Things as well as the Cloud are a catalyst for Software R&D spend for Enterprises
▪ To support the transition to software R&D, companies are increasingly focusing on recruiting data and software engineers as opposed to traditional employee profiles such as mechanical and electrical engineers
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61.6%
3.5%6.2%
8.9%
3.6%
14.1%
2.1%
Sources: Company annual reports, IPO documents, Avendus research
Note: (1)2016 revenue split by verticals; (2)Luxoft’s FYE is March
25.2%
22.4%
20.5%
15.0%
9.1%
6.9%
1.1%
18.5%
19.6%
15.9%
21.0%
8.9%
13.1%
2.9%
EPAM(1) Globant (1)Luxoft (1)
(USD in millions) FY 2011 FY 2016 CAGR FY 2012 FY 2017 CAGR FY 2011 FY 2016 CAGR
ISV revenues 87.4 237 22.1% 29 49 10.7% 21 51 19.6%
% of Total revenues 26.1% 20.5% 10.8% 6.2% 23.3% 15.9%
Total revenues 334.5 1,160.1 28.2% 271.1 785.6 23.7% 90.1 322.9 29.1%
Others
Financial Services
Travel & Consumers
Software & HiTech
Media & Entertainment
Life Sciences & Healthcare
Emerging verticals
Travel & Aviation Financial
Services
Technology
Telecom
Automotive &Transport
Others
BFSI
Travel & Hospi-tality
Technology & Telecoms
Consumer, Retail & Mfg.
Media & Entertainment
Professional Services
Others
FY16ARevenues$1,160m
FY17ARevenues
$786m
FY16ARevenues
$323m
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Healthcare
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13Source: Equity research, corporate presentations and annual reports
Software, Hi-Tech, ISVs
▪ Capital markets & GRC▪ Asset & Wealth management▪ Corporate & retail banking▪ IB & brokerage▪ Research & analytics▪ Cards and payments▪ Block chain▪ Omni-channel banking▪ Regulations, compliance & risk
management
Financial services Travel & Aviation
Life Sciences & HealthcareMedia & Entertainment Automotive & transport
▪ Constant need for innovation & rapid time to market
▪ Improve utilization▪ Access to skills, not available in-house▪ Increase flexibility of technical employees ▪ Product Engineering▪ End-to-end solutions▪ User experience
▪ “Inside the cockpit” features e.g. infotainment and navigation, human machine Interface, autonomous driving
▪ “Under The Hood” features e.g. powertrain, chassis, motor, breaks
▪ “Extended vehicle” features e.g. cloud and diagnostics services connecting the vehicle to core business processes
▪ Accelerate creation, collection, packaging & management of content
▪ Digital video▪ Direct to consumer▪ Omnicommerce▪ Ad monetization analytics▪ Improve return-on-content
▪ Accelerate drug discovery, research & time to market
▪ Clinical & pre-clinical R&D platforms▪ Improved collaboration, knowledge
management & operational excellence▪ Big data and health analytics▪ Advanced health (genomics etc)
▪ E-commerce & cost optimization solns.▪ Transition from “personalized customer
service” to “customer self-service”▪ Growing concept of connected airplane
based on IoT technologies and on-demand infotainment
▪ Improved comfort & safety▪ Flight control systems, Aircraft assembly &
maintenance, airport mgmt
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14Sources: Ericsson Mobility Report 2017, Statista, ‘State of Internet’ – 2014 by Mary Meeker
▪ Smartphone subscriptions are expected to grow from 3.9bn in 2016, to 6.8bn In 2022
- Average selling price of smartphones has declined from $440 in 2010 to $283 in 2016 with the trend expected to continue in the visible future
▪ Correspondingly, the number of connected devices are expected to grow from 16bn to 29bn over the same period
Devices, wearables& a connected
ecosystem
Big Data and analytics
▪ An estimated 8.8 Exabytes of mobile data traffic was generated in 2016; expected to grow to 71 Exabytes by 2022
- An estimated 34% of the data generated is useful but only 1% of it is analyzed in some form or other
BYOD and consumerization
of IT
User centric experience
▪ User centric internet has led to consumers demanding richer, more interactive experiences on websites and software applications
- Applying data mining technologies and predictive analytics to user’s browsing history to create a ‘Social Graph’ can enable enterprises to customize internet pages, optimize internet searches & tailor offerings
▪ As Bring Your Own Device (BYOD) grows, employees bring ‘Consumer market’ technologies in their workplace leading to consumerization of IT
▪ Employees expect the same experience and features from business applications
- Enterprises are adapting by upgrading legacy systems to offer new interfaces and modernize applications & processes with help of leading edge mobile, cloud, analytics and security capabilities
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15Source: Nasscom – Shaping the digital revolution 2015
Notes: (1)Traditional technologies include custom ADM, SI, BPO, IMS, hardware, packaged software & telecom services(2)Digital technologies include social media, mobile applications, big data analytics, cloud (IaaS, SaaS, BPaaS) and cybersecurity
▪ Digital Business is becoming a strategic imperative for enterprises to
- Compete globally with differentiation advantage- Improve efficiency and effectiveness of business
operations
▪ Vertical-focused software development in sync with industry trends
- 41% of value of car contributed by software (connectivity, active safety, engine management, infotainment)
- 4-9x increase in engineering software in O&G (micro seismic analysis, production management, digital oilfield applications)
- 26% y-o-y growth in 3D printing software and cataloguing applications in discrete manufacturing industries
USD billions
2014 2020E 2025E
Traditional Digital
15-25% of traditional spend
saved by going digital
80% of new spend around digital technologies
- 450 to - 6502,757
1,170 to 1,400
3,440 to 3,550
3,950 to 4,100
60%30%
40%
35%
65%
80%
20%
10%
90%
15% - 25%
Traditional spend evaporates
New service lines
(1) (2)
4
CAGR : 3-4%
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16Sources: Statista, We are Social, Gartner, EMC
$93bn2012
$104bn 2017
MobileSocial Analytics Cloud
+3% increase in mobile phone
users since last year
4.6 4.8
2016 2017
Number of mobile phone usersworldwide (in billions)
2.3
2.8
2016 2017
Active social media users (inbillions)
+21% increase in active social
media users since last year
4.4
44
2013 2020
Data (in zettabytes)
+39% Annual increase in digital
data we create or copy per year
209.2
246.8
2016 2017
Cloud Market (in USD billions)
+18% Increase of the Global Cloud market (in USD
billions)
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DATE ACQUIRER TARGETDEAL
VALUETARGET
HQTARGET DESCRIPTION STATED ACQUISITION RATIONALE / DESCRIPTION
PU
REP
LAY
OP
D A
CQ
UIR
ERS
Jun-17Up to $28m
Design and development tech agency with digital experts specialized in retail, supply chain and insurance services solutions
Reinforcing focus on digital transformation and expand US footprint
Mar-17 NAA digital services company specialized on video streaming solutions
Strategic acquisition to accelerate expertise in digital transformation and innovative software development in the media & entertainment sectors
Nov-16 NA A digital services companyAligned with Globant's unique vision of creating digital journeys, which involves creation of products that take into account each moment of interaction between the brand and the user
May-16 NA An innovative service design companyReinforce focus on digital journeys, digital transformation, strategy, user experience, design and insight
Jul-15 NA A digital strategy and experience design firmEnhance EPAM’s ability to provide digital consulting, architecture and content solutions to customers in North America and beyond
OFF
SHO
RE
SYST
EM
INTE
GR
ATO
RS
Nov-16 NAA experience design agency helping global brands design better, and more relevant, digital products and services for customers
Fortifies Zensar’s digital offerings and furthers the company’s ability to work with CMOs and CDOs to improve outcomes for their customers, and to drive innovation through design
Jun-16Up to£45m
Specialises in digital transformation and innovation, helping organisations change the way they engage with customers
Further strengthen and enable TechM to engage with clients at the start of the journey and help design customer experience for their businesses
Jul-15 $94mStrategic design firm specializing in designing transformative product-service experiences
Complement the capabilities of an established design leader with Wipro's engineering heritage and deliver compelling value to clients
Apr-15 $120mA provider of digital experience solutions, including mobile commerce and in-store shopping experiences to large retail clients
Acquisition in line with Infosys’ strategy to help clients bring new digital experiences to their customers through IP-led tech offerings, automation tools and skill and expertise in new emerging areas
GLO
BA
L P
LAY
ERS
WIT
H
OP
D C
AP
AB
ILIT
IES Feb-17 NA
A fast-growing digital strategy and experience design consultancy
Reinforce the Group’s user-centered and digital-first experience design and strategy services, particularly in North America, and helps address the growing demand end to end digital services
Nov-16 NADigital marketing and customer experience agency specializing in travel & hospitality, financial services, retail, and B2B sectors
Expand Cognizant's digital business capabilities in the Netherlands and across Europe
Feb-16 NA An innovation strategy and design firmAugments Capgemini Consulting’s ability to define new products, business transformation and digital customer experience solutions
Oct-16 NA UX and interactive design firmTo become a fully integrated end-to-end Digital Transformation Service (from strategy and UX through to the build and operation of the platform) that helps companies become digital businesses
Note: (1)Quotes by Arkadiy Dobkin, CEO – EPAM Systems Inc.
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CRITICAL MASS
ACQUISITION OF VERTICAL-
SPECIFIC CAPABILITIES
M&A – a tool for value
creation
ACQUISITION OF TECHNICAL / LANGUAGE CAPABILITIES
PROXIMITY TO CLIENTS
NEAR-SHORING /
OFFSHORING
CLIENT ACQUISITION
▪ Scale enables companies to bid for larger client projects and hence is a key driver for consolidation in the OPD space
▪ Improves communication between clients and delivery teams, better cultural affinity, minimal time zone difference, increases efficiency, reduces complexity and execution risks
▪ Competitive pressures to deliver high quality service at optimum price points drives OPD players to constantly seek to acquire delivery capabilities in nearshore jurisdictions
▪ Diversification into a new vertical or enhancing vertical-specific delivery capabilities is an important driver of M&A activity and can also assist in client-acquisition
▪ Smaller OPD players can be attractive targets depending on their client profile
▪ Acquisition of clients or deepening existing client relationships is an important driver for M&A activity
▪ Established players efficiently use M&A as a tool to build capabilities be it technical or language
▪ Acquisitions help in quickly ramping up required skill-sets as against an organic build-out
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IT SERVICESSOFTWARE ENGINEERING
SPECIALISTSER&D DIGITAL & MEDIA
CONSULTING FIRMS
FINANCIAL INVESTORS
Vary depending on size, location, equity stake and
other fund-specific
investment criteria
▪ Adding capabilities in product development and digital space
▪ Acquisition of marquee enterprise clientele and cross selling
▪ Capitalize on the superior growth rates (>20%) of the OPD segment (much higher than growth rates for other technology services segments)
▪ Revenue scale-up
▪ Diversify into or ramp up capabilities in specific verticals
▪ Adding capabilities in new technologies and digital space
▪ Need to diversify away from ISV exposure and into enterprise clients
▪ Geographical diversificationof delivery locations
▪ Extend the value chain from pure mechanical engineering services, to OPD
▪ Acquire nearshore oroffshore delivery centers
▪ Augment existing digital offerings with OPD capabilities to provide an end-to-end service offering
▪ Capture larger share of client’s wallet as decision making at clients becomes more centralized
▪ Good opportunity to enter a fast growing segment
▪ Opportunity to acquire marquee enterprise clientele
▪ Superiorgrowth and high margins attractinterest from both large international as well as local financial investors
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KEY M&A TRANSACTIONSOPD M&A OVERVIEW
Date Target Buyers / Investors Acquirer Rationale
Nov-17 Aricent AltranEnhance Altran’s financial profile and client footprint, improve profitability and cash generation
Sep-17 Global Edge AltranReinforced software strategy and adds to geographical strength
Jun-17Tata Technologies
Warburg PincusFinancial Investor – target fast-growing markets and sectors
Jun-17 PointSource GlobantStrengthen Globant’s capabilities to build products for digital transformation
May-17 FDV Consulting Intive Expands business in America, especially in the US
Mar-17 derivIT Solutions Luxoft Expands capabilities in capital markets technology area
Jan-17 GlobalLogic CPPIBFinancial Investor – target fast-growing markets and sectors
Nov-16 L4 Globant Reinforces focus on digital services
Jul-16 Lohika AltranExpands Altran’s outsourced software development and their Industrialized GlobalShore delivery capabilities
Jun-16 Dextrys EPAMEnhances global delivery capabilities and extends footprint in China
Jan-16 REC Global GlobalLogic Expands European presence and strengthens embedded software capabilities
Dec-15 Ciklum Soros Fund Strategy of targeting fast-growing markets and sectors
Nov-15 Quest Global Bain Capital Strategy of targeting fast-growing markets and sectors
Sep-15 Mobica Inflexion Help accelerate organic growth
Sep-15Blue Star Infotech
InfogainBrings digital transformation platform with new capabilities
May-15 Rally CA TechnologiesComplements and expands CA’s strength in the areas of DevOps and Management Cloud
Jan-15Symphony Teleca
HarmanAdds scale in software services and gain capabilities around mobility, analytics, and cloud
Apr-14 Aditi Symphony TelecaAcquires unique Systems of Engagement (SoE) capabilities, design and cloud expertise
Jan-13 Globant WPPMinority Transaction (20%) – Strengthens WPPs capabilities
Jan-11 Sierra Atlantic HitachiAdditionnal offshore Global Development Centers and expand capabilities of Oracle business
▪ Attractiveness of the outsourced custom software development industry is at a peak level; primarily driven by the following market characteristics:
- Strong growth in the sector (strongest within outsourced R&D) due to high demand for agile development and niche software talent to deliver increasingly demanding and short time-to-market technology projects, for Enterprises and ISVs alike
- Acquisition of front-end capabilities for digital transformation, and UI/UX design
- Ongoing consolidation with strategic acquirers (both standalone and PE-backed) keen to acquire niche capabilities as well as larger teams to fulfil large work package projects
- Attractive financial performance of industry leaders with market leading growth and margins vs. other IT Services segments
- Low cost of debt available in the market place
▪ Thus M&A in this sector has seen the following:
- Upward trend in the volume and value of closed transactions in recent years
- Marquee Deals – CPPIB/Global Logic, Altran/Lohika, Harman/ Symphony Telelca, CA Technologies /Rally Software, and Bain Capital /Quest Global
- Continued interest from the Private Equity community – Cornerstone acquiring IT Kontrakt, EI acquiring Intive, Inflexion acquiring Mobica, Blackstone acquiring Pactera Soros acquiring Ciklum and Apax acquiring GlobalLogic
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▪ CEE region is becoming an increasingly popular destination for near-shoring and a diversification alternative for Western European companies, as well as European divisions of large global companies
▪ Key benefits of near-shoring to the CEE region include –
- Minimal time zone difference vis-a-vis Europe, physical proximity to client and ease of travel
- Cultural affinity
- Easier to find European language capabilities such as French and German
- High-quality talent with strong technical skills
- Improved control over Intellectual Property (IP) within the over-arching umbrella of the EU
- Faster speed to market
- General economic / political stability across the region
▪ Governments have moved to attract investments through setting up technology parks, providing financial incentives and by promoting STEM subjects in universities
Estonia
Belarus
Ukraine
Poland
Czech Republic
Slovakia
HungaryRomania
Bulgaria
Slovenia
Croatia
Albania
Bosnia
MacedoniaMontenegro
Serbia
Moldova
Russia
Lavtia
Lithuania
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CountryPopulation (in millions)
2016
% Tertiary education 2016(3) EU / Non-EU
Employment in BPO
Rent / m² / month(1)
Avg. entry level cost / annum(2)
Major HubsGlobal IT Players with presence in
CEE
Belarus Estimated ~33% Non-EU N/AMinsk:€16-€28
$19k – $24kBelarus Hi Tech Park (Minsk)
EPAM, Exadel
Bulgaria EU 18,900Sofia:€11-€13
$21k – $26k SofiaCSC, SAP, HP, Convergys, VMware
Czech Republic
EU 40,500Prague:€13.2-€19.4
$25k – $30kPrague, Brno, Ostrava
Accenture, CSC, HP, SAP, Redhat, IBM, Infosys
Hungary EU 45,400Budapest:€12.8-€18
$24k – $29kBudapest, Debrecen, Székesfehérvár
EPAM, Cognizant, TCS, IBM
Poland EU 150,000
Warsaw:€18-€22.5Wroclaw:€14-€15.5
$22k – $27kWarsaw, Krakow, Tri-city, Lodz, Wroclaw
Sabre, Capgemini, HCL, Luxoft, Xerox
Romania EU 50,900Bucharest:€14.5-€18
$23k – $28kBucharest, Cluj, Iasi, Timisoara, Brasov
Accenture, Capgemini, Genpact, HP, Luxoft, Wipro, WNS
Russia N/A Non-EU N/AMoscow: €10-€15
$12k – $20kMoscow, St. Petersberg, Kazan,Nizhny Novgorod
EPAM, Luxoft, IBM, Oracle, Microsoft
Ukraine N/A Non-EU N/AKyiv: €12.6-€25.2
$18k – $24k Lviv, Kyiv, KharkivCisco, Oracle, Rakuten, Samsung
28%
15%
22%
12%
22%
Sources: Association of Business Service Leaders (Business Services in Central & Eastern Europe – 2015Notes: (1)Colliers EMEA Office Rents 2016; Russia’s data from realty.kurs-kotirovka.ru
(2)Represents the Software Development Employee Cost per Annum – <5 yrs experience; Russia’s data from software-russia.com(3)Represents the % people who have completed their tertiary education between age groups of 15 to 64 years
43
144
20
38
10
11
7
10
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Size and growth profile
▪ Ability to sustain larger employee strength is indicative of resilience, quality of service & revenue recurrence
▪ Although large pureplay OPD players such as EPAM, Luxoft and Globant attract premium valuation multiples vis-à-vis peers, when adjusted for anticipated revenue / margin growth, the multiples tend to be benign
Revenue / Customer profile
▪ Stable, long-term relationships with top customers, lower client concentration and multi-year SLA-based services contracts (as against project based revenues)
▪ Low level of dependence on ISV / Start-up clients (typically involving short-term project based work)
- EPAM has a stated objective of maintaining ISV revenue in the range of 20% of its total revenues
Historical financials & forecasts
▪ Demonstrated historical growth and attractive forecasts backed by secure customer-specific revenues
▪ Stable margin with well controlled base of direct and indirect costs
Delivery Centres / Geography ▪ Geographies with lower employment cost and high talent availability, while maintaining reasonable levels of wage inflation, are
preferred delivery locations as this criteria is an important contributor to margin profile
Profitability & margin profile ▪ Ability to generate a recurring and stable level of profitability in line with the market (~15%-20% EBITDA)
Quality of management team ▪ Experience, reputation and market-perception of management team
Type of customer engagement▪ Critical outsourced teams well integrated into client teams vs. fully outsourced
▪ Basic IT services and T&M versus delivering fully outsourced software engineering projects
Business Model
▪ Pure Time & Material (primarily utilization driven) vs.
▪ Packaged (Team-based) T&M vs.
▪ Fixed Price Projects (primarily outcome-based)
Employee Metrics▪ Utilization rates (for T&M business)
▪ Attrition % (increasingly important metric as Attrition Rates increase across delivery locations)
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Transaction / Size Discount
EV / REVENUE INDUSTRY AVERAGES – 2018E EV / EBITDA INDUSTRY AVERAGES – 2018E
REVENUE GROWTH AVERAGES (%) – 2017-18E EBITDA MARGIN AVERAGES (%) – 2018E
Transaction / Size DiscountTrading valuation
Transaction valuation
Trading valuation
Transaction valuation
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Source: CapIQ as of 08 January 2018Notes: 1. Outsourced Software development companies include EPAM, Luxoft, Globant and Persistent
2. Diversified Global IT companies include TCS, Cognizant, Infosys, Wipro, Capgemini, HCL and Atos3. Diversified Offshore IT companies include Tech Mahindra, L&T Tech Services, Mindtree, Virtusa, Cyient, KPIT and Sonata Software4. ER&D companies include Altran, Alten, ÅF AB, Bertrandt, Akka Technologies, L&T Tech, Cyient and Tata Elxsi
1.6x
2.5x2.2x
1.3x 1.3x
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reIT
wit
h O
PDan
gle ER
&D
8.7x
14.7x
10.7x 10.2x11.1x
Out
sour
ced
Soft
war
eD
evel
op
men
t
Ou
tso
urc
edSo
ftw
are
Dev
elo
pm
ent
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bal
IT
wit
hO
PD
an
gle
Div
. Off
sho
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wit
h O
PDan
gle ER
&D
19.4%
8.4% 8.8%6.6%
Outsourced SoftwareDevelopment
Diversified Global ITwith OPD angle
Diversified OffshoreIT with OPD angle
ER&D
16.7%
21.7%
10.7% 11.3%
Outsourced SoftwareDevelopment
Diversified Global ITwith OPD angle
Diversified OffshoreIT with OPD angle
ER&D
Private & Confidential
27
Trading Multiples
Transaction Multiples
Avendus deal case studies
OPD players – profiles
Avendus Credentials
Private & Confidential
28Private & Confidential
2929
Company MV EV Revenue EBITDA EV / Sales EV / EBITDA P/E EBITDA margin (%) Rev. growth (%)
(USDm) (USDm) 2017E 2017E 2017E 2018E 2019E 2017E 2018E 2019E 2018E 2019E 2018E 2019E 2018E 2019E
Outsourced Software Development
EPAM 6,157 5,669 1,448 258 3.9x 3.2x 2.7x n/m 17.7x 14.8x 26.5x 22.0x 18.2% 18.0% 21.7% 20.4%
Luxoft 2,017 1,962 889 132 2.2x 1.9x 1.6x n/m 11.7x 9.6x 17.0x 13.8x 16.0% 16.4% 18.2% 18.6%
Globant 1,684 1,648 407 65 4.0x 3.4x 2.8x n/m 19.8x 17.2x 29.8x 24.2x 17.0% 16.4% 20.6% 19.0%
Persistent 904 789 481 74 1.6x 1.5x 1.3x 10.6x 8.8x 7.6x 15.4x 13.5x 16.4% 17.0% 12.8% 12.5%
Median 1,851 1,805 685 103 3.1x 2.5x 2.1x n/m 14.7x 12.2x 21.8x 17.9x 16.7% 16.7% 19.4% 18.8%
Diversified Global IT with OPD angle
TCS 81,861 76,741 19,125 5,119 4.0x 3.7x 3.4x 15.0x 13.8x 12.7x 18.7x 17.2x 26.8% 26.9% 8.4% 8.7%
Cognizant 43,427 39,465 14,804 3,052 2.7x 2.4x 2.2x 12.9x 11.2x 9.7x 16.8x 14.6x 21.7% 23.1% 9.4% 8.9%
Infosys 35,497 30,065 10,892 2,925 2.8x 2.5x 2.4x 10.3x 9.5x 8.8x 15.2x 14.1x 26.8% 26.7% 8.5% 7.9%
Wipro 23,786 20,063 8,651 1,763 2.3x 2.2x 2.1x 11.4x 10.7x 10.0x 16.3x 15.2x 20.7% 21.0% 4.6% 5.8%
Capgemini 20,824 23,408 15,224 2,054 1.5x 1.5x 1.4x 11.4x 10.7x 9.8x 16.3x 14.9x 14.0% 14.6% 3.1% 4.3%
HCL 19,763 18,761 7,709 1,710 2.4x 2.2x 2.0x 11.0x 9.9x 9.1x 13.6x 12.7x 22.2% 22.1% 11.3% 8.9%
Atos 15,920 16,152 15,204 2,023 1.1x 1.0x 1.0x 8.0x 7.7x 7.2x 14.2x 13.1x 13.4% 13.9% 2.9% 2.9%
Median 23,786 23,408 14,804 2,054 2.4x 2.2x 2.1x 11.4x 10.7x 9.7x 16.3x 14.6x 21.7% 22.1% 8.4% 7.9%
Diversified Offshore IT with OPD angle
Tech Mahindra 8,372 7,291 4,762 688 1.5x 1.4x 1.3x 10.6x 9.3x 8.3x 14.2x 13.1x 15.2% 15.6% 8.8% 9.3%
Mindtree 1,636 1,550 845 105 1.8x 1.7x 1.5x 14.7x 12.6x 10.8x 20.1x 17.6x 13.3% 13.9% 10.0% 11.1%
Virtusa 1,385 1,448 968 68 1.5x 1.3x 1.2x 21.2x 15.4x 12.1x 23.4x 18.6x 8.6% 9.8% 13.1% 11.7%
KPIT 613 578 558 56 1.0x 1.0x 0.9x 10.3x 8.9x 8.6x 15.1x 13.6x 10.7% 10.5% 8.4% 5.9%
Sonata Software 449 409 376 35 1.1x 1.0x 0.9x 11.8x 10.2x 9.6x 15.4x 13.8x 10.0% 8.9% 7.2% 17.9%
Median 1,385 1,448 845 68 1.5x 1.3x 1.2x 11.8x 10.2x 9.6x 15.4x 13.8x 10.7% 10.5% 8.8% 11.1%
ER&D
Altran 3,047 3,507 2,726 315 1.3x 1.2x 1.2x 11.1x 9.9x 8.9x 14.3x 12.8x 12.2% 12.9% 6.3% 5.1%
Alten 2,991 2,970 2,331 236 1.3x 1.2x 1.1x 12.6x 11.1x 10.4x 16.8x 15.4x 10.7% 10.9% 6.6% 5.2%
ÅF 1,868 2,090 1,538 139 1.4x 1.3x 1.2x 15.0x 13.0x 12.2x 17.3x 16.1x 9.9% 10.1% 5.6% 4.5%
L&T Tech Services 1,850 1,807 554 89 3.3x 2.9x 2.5x 20.3x 17.4x 14.9x 23.9x 21.3x 16.5% 17.1% 13.6% 13.0%
Bertrandt 1,309 1,400 1,199 119 1.2x 1.1x 1.1x 11.8x 9.9x 8.9x 20.0x 17.8x 11.3% 12.0% 4.5% 4.5%
Akka 1,180 1,429 1,570 135 0.9x 0.9x 0.8x 10.6x 8.9x 8.0x 14.1x 12.3x 9.7% 10.3% 5.1% 4.9%
Cyient 1,036 909 601 83 1.5x 1.3x 1.2x 11.0x 9.2x 8.0x 14.5x 12.9x 14.6% 15.0% 12.4% 12.1%
Tata Elxsi 983 932 212 50 4.4x 3.8x 3.6x 18.8x 16.0x 16.0x 26.7x 23.5x 23.8% 22.3% 15.6% 7.0%
Assystem SA 727 819 484 37 1.7x 1.6x 1.5x 22.1x 19.9x 17.9x 16.5x 14.3x 7.9% 8.4% 7.6% 4.3%
Median 1,309 1,429 1,199 119 1.4x 1.3x 1.2x 12.6x 11.1x 10.4x 16.8x 15.4x 11.3% 12.0% 6.6% 5.1%
Median 1,868 1,962 1,448 135 1.6x 1.5x 1.4x 11.6x 10.7x 9.7x 16.5x 14.6x 14.6% 15.0% 8.5% 8.7%
Max 81,861 76,741 19,125 5,119 4.4x 3.8x 3.6x 22.1x 19.9x 17.9x 29.8x 24.2x 26.8% 26.9% 21.7% 20.4%
Min 449 409 212 35 0.9x 0.9x 0.8x 8.0x 7.7x 7.2x 13.6x 12.3x 7.9% 8.4% 2.9% 2.9%
Source: All projections have been calculated based on Capital IQ as at 08 January 2018
Current FYE has been taken to be December 2016 Private & Confidential
30Private & Confidential
31
Date Target HQ Target Business Description
Transaction Value
(USDm)Buyers / Investors
LTM Revenue(USDm)
LTM EBITDA(USDm)
Implied Enterprise
Value (USDm)
Implied Enterprise Value/LTM
Revenue
Implied Enterprise Value/LTM
EBITDA
Nov-17Design and engineering services, primarily serving clients of the communications and technology, semiconductor and software industries
2,018 582.6 140.7 2,018 3.5x 14.3x
Sep-17Product engineering company specialized in IoT connectivity and embedded software
47 n/a n/a n/a n/a n/a
Jul-17iNTENCE automotive electronics GmbH develops software solutions for the automotive industry.
$8m n/a n/a n/a n/a n/a
Jun-17Clarity Consulting designs, develops, customizes, and implements enterprise software applications for businesses.
$9m $27.0m n/a $9m 0.35x n/a
Jun-17PointSource designs and develops transformative digital solutions for the retail, supply chain, and insurance sectors.
$28m n/a n/a $28m n/a n/a
Sources: Capital IQ, Mergermarket
31Private & Confidential
32
Date Target HQ Target Business Description
Transaction Value
(USDm)Buyers / Investors
LTM Revenue(USDm)
LTM EBITDA(USDm)
Implied Enterprise
Value (USDm)
Implied Enterprise Value/LTM
Revenue
Implied Enterprise Value/LTM
EBITDA
Jun-17Provider of engineering services outsourcing, product lifecycle management software solutions, and enterprise resource management services
$360m 225 n/a 837 3.7x n/a
May-17 FDV Solutions designs and develops software solutions. n/a n/a n/a n/a n/a n/a
Apr-17Smile provides open source solutions to companies and institutions in France and internationally.
$51m $81.7m n/a n/a 1.33x n/a
Apr-17IT Kontrakt specializes in outsourcing of IT specialists who carry out projects related to development and implementation of modern technologies for business.
$38m $50.0m n/a $39.8m n/a n/a
Apr-17 Difier S.ADifier provides information technology support services as wells develops software products.
n/a n/a n/a n/a n/a n/a
Mar-17derivIT provides information technology consulting services to the capital markets technology area across Singapore, Malaysia, Australia, the Middle East, India, and China.
n/a n/a n/a n/a n/a n/a
Mar-17 Ratio Interactive provides digital agency services for brands. n/a n/a n/a n/a n/a n/a
Feb-17Intropro provides product development, engineering, and software development consulting services.
$28m n/a n/a $28m n/a n/a
Sources: Capital IQ, Mergermarket
32Private & Confidential
33
Date Target HQ Target Business Description
Transaction Value
(USDm)Buyers / Investors
LTM Revenue(USDm)
LTM EBITDA(USDm)
Implied Enterprise
Value (USDm)
Implied Enterprise Value/LTM
Revenue
Implied Enterprise Value/LTM
EBITDA
Jan-17GlobalLogic provides full-lifecycle product development services to customers worldwide (undisclosed minority stake)
$720.0m $450m n/a $1,500m 3.33x 16.7x
Nov-16L4 Mobile provides digital products consulting, design, development, and quality assurance services worldwide.
$20m n/a n/a $20m n/a n/a
Oct-16Butler America Aerospace provides engineering, IT, BPO, application development, staffing, health care, and fleet services for aerospace, defense, and federal markets in the United States.
$85m $85.4m n/a $85m 1.00x n/a
Oct-16Pactera Technology provides consulting and technology services in the People’s Republic of China.
$675m $777m n/a n/a n/a n/a
Sep-16Pelagicore develops and licenses open source software applications in automotive infotainment industry.
$19m $6.4m ($0.6m) $19m 3.00x n/m
Aug-16Softline Group engages in software licensing and provision of IT services to customers in various industries worldwide.
$40m n/a n/a n/a n/a n/a
Jul-16 Lohika Systems provides software development services. n/a $50.0m n/a n/a n/a n/a
Jul-16Excelian is a technology consultancy that provides technology and IT services to financial services and commodities industries.
$21m $58m $2 m $21m 0.40x 10.4x
Jul-16INSYS develops specialized solutions with a primary focus on the healthcare, pharmaceuticals & biotech, and telecom sectors.
$71m n/a n/a $71m n/a n/a
Jun-16 Dextrys provides software engineering and application services. n/a n/a n/a n/a n/a n/a
Sources: Capital IQ, Mergermarket
33Private & Confidential
34
Date Target HQ Target Business Description
Transaction Value
(USDm)Buyers / Investors
LTM Revenue(USDm)
LTM EBITDA(USDm)
Implied Enterprise
Value (USDm)
Implied Enterprise Value/LTM
Revenue
Implied Enterprise Value/LTM
EBITDA
Jun-16Estonia-based company that operates as a software development company.
$17mEmployees of Nortal
$51.0m $4m $34m 0.70x 8.1x
Jun-16Softvision Consulting provides outsourced software development services to startup companies and Fortune 500 companies worldwide.
$150m $60m $17m $150m 2.50x 8.6x
May-16We Are London operates as a customer experience and service design consultancy.
n/a n/a n/a n/a n/a n/a
Apr-16Geometric provides software and engineering services primarily in India, the United States, Europe, and the Asia Pacific.
$192m $173m $16m $192m 1.11x 11.8x
Feb-16Symtavision provides timing-analysis solutions for processors, control-units, buses, and integration for the automotive and consumer electronics markets.
n/a n/a n/a n/a n/a n/a
Feb-16Acamica operates as an online, web, and mobile microlearning platform.
n/a n/a n/a n/a n/a n/a
Jan-16REC Global is a software engineering company providing R&D software services, custom software solutions and consultancy expertise to companies across the globe.
n/a n/a n/a n/a n/a n/a
Dec-15 QuEST Global Services is an engineering services company. $325m n/a n/a $1,300m n/a n/a
Nov-15Ciklum ApS operates as an information technology (IT) outsourcing company specializing in nearshore software development in Ukraine.
n/a n/a n/a n/a n/a n/a
Nov-15Alliance Global Services LLC provides software design, development, and quality management services.
$52m n/a n/a $52m n/a n/a
(Certain Assets)
Sources: Capital IQ, Mergermarket
34Private & Confidential
35Sources: Capital IQ, Mergermarket
Date Target HQ Target Business Description
Transaction Value
(USDm)Buyers / Investors
LTM Revenue(USDm)
LTM EBITDA(USDm)
Implied Enterprise
Value (USDm)
Implied Enterprise Value/LTM
Revenue
Implied Enterprise Value/LTM
EBITDA
Oct-15Königstein Beratungsgesellschaft für EDV-Dienstleistungen Mbhprovides IT recruitment services.
$4m n/a n/a $5m n/a n/a
Sep-15Mobica provides software development and integration services. including UI / UX, QA, testing, and professional engineering services.
n/a n/a n/a n/a n/a n/a
Sep-15Blue Star Infotech is a global provider of product development services, enterprise solutions and services, travel technology solutions and testing services.
$32m $42m $5m $37.6m 0.89x 7.4x
Jul-15NavigationArts provides Web and application design and development consulting services.
$29m n/a n/a $27m n/a n/a
May-15Rally Software provides cloud-based solutions for the management of Agile software development worldwide.
$539m $93m ($28m) $471m 5.09x n/m
May-15Clarice Technologies designs and develops various software products on desktop, Web, tablet, smartphones, and TV platforms by using the latest technologies and frameworks.
$20m $8m $3m $20m 2.60x 7.9x
Mar-15Bluestar Energy
Peru Bluestar Energy (n.k.a Globant Peru) develops software solutions. $1m n/a n/a $1m n/a n/a
Jan-15Symphony Teleco Corporation Connected Services Corporation provides software services for the connected world.
$780m $370.0m n/a $780m 2.11x n/a
35Private & Confidential
36Private & Confidential
37
TRANSACTION HIGHLIGHTS
▪ Announced: Jan 2018
▪ Consideration: Undisclosed
▪ Multiples: Undisclosed
▪ Offer: All-cash
▪ Engagement type: Sell-Side
▪ Sector: Product Engineering Services
▪ Avendus role: Advisor to eInfochipsC
LIEN
T TH
ESIS ▪ eInfochips was looking to partner with a global major to diversify its client base, mine its existing marquee client base
and to monetise its investments in software platforms for connected devices
▪ Opportunity for the promoter and long term employees of the company (beneficiaries of an ESOP plan) to get liquidity
RES
ULT
▪ A very selective and refined outreach was undertaken to ensure discussion with probable buyers
▪ Five serious suitors - three strategic and two private equities players
▪ Strong conviction that the selected partner offered significant synergies for future growth of the company
AV
END
US
RO
LE
▪ Ran a tight, controlled auction process with only a handful of very probable potential suitors
▪ Prepared the company, well in advance, by way of completing a financial, tax and legal VDD prior to launch of deal; advised on various structuring aspects of a complex cross-border transaction, including a tender offer in the US for minority shareholders
▪ Managed to conclude the entire deal, from marketing to closing, in a short-timeframe of 6 months
acquired
Advisor to eInfochips
DEA
LR
ATI
ON
ALE ▪ By joining Arrow, eInfochips becomes part of a Fortune 118 company with a global reach in 90 countries and a long-
standing commitment to guiding innovation in the sphere of connected devices
▪ The combined entity plans to deliver complex and connected IoT solutions and technologies across multiple cloud platforms to their complementary client base and using synergistic delivery locations
TARGET PROFILEACQUIRER PROFILE
▪ Arrow Electronics Limited is an NYSE listedFortune 118 company specialising in distributionand value added solutions to users of electroniccomponents and enterprise computing solutions
▪ Has made a decisive push to undergo a digitaltransformation in the last 2 years▪ Arrow.com is their fastest growing channel▪ Is one of the largest technology media
companies in the world▪ Strong focus on IoT – with its patented sensor-
to-sunset offering
▪ Founded in 1995, eInfochips has over 1,500employees spread across India, US and Japan,offering OPD services encompassing silicondesign & verification services to software productdevelopment services to large Fortune 500companies
▪ Strong focus on IoT, video management andcloud based services
Undisclosed
Private & Confidential
38
TRANSACTION HIGHLIGHTS
▪ Announced: July 2016
▪ Consideration: Undisclosed
▪ Multiples: EV/LTM sales: Undisclosed
EV/LTM EBIT: Undisclosed
▪ Offer: All-cash
▪ Engagement type: Sell-Side
▪ Sector: Outsourced Software Development
▪ Avendus role: Advisor to Lohika
CLI
ENT
SITU
ATI
ON
▪ The shareholders of the company were looking for a strategic partner to grow their US presence on the back of large clients and thereby scale up their revenue profile by delivering a broader range of service offerings
RES
ULT
▪ Evaluated and pre-marketed to a large number of prospective buyers in the US, Europe, India as well as a number of Global Private Equity
▪ Received multiple indications of interest from both strategic and private equity buyers
▪ Successful negotiation of transaction documentation on terms satisfactory to the client
AV
END
US
RO
LE
▪ Avendus ran a competitive process with over 100 investors, of which 15-20 had management meetings resulting in multiple offers. Investors included both international and domestic strategic players and top-tier sponsors
▪ Avendus ran an efficient two stage deal process and seamlessly coordinated a globally distributed deal team across the US (both West and East coast), Europe (France, Ukraine and Romania) and India
acquired
Advisor to Lohika
DEA
LR
ATI
ON
ALE ▪ The combination of Lohika with Altran will create a superior value proposition, enabling the Group to reach a
leadership position in software product development on the US West Coast
▪ The USA becomes the second largest region for Altran
▪ Lohika will expand and diversify Altran’s Industrialized GlobalShore© delivery capabilities
TARGET PROFILEACQUIRER PROFILE
▪ Altran Technologies offers engineering consulting services for the creation and development of new products and services in France and internationally
▪ The company provides various services in the areas of intelligent systems, innovative product development, lifecycle experience, mechanical engineering, and information systems
▪ Founded in 2001, Lohika is a premium software engineering services firm whose highly experienced teams provide s/w development solutions to leading technology companies
▪ Lohika is active in North America with experienced delivery teams in Ukraine and Romania comprising of 700+ software engineers
▪ Customers range from technology majors to fast growing start-ups which are 100% reference-able
Undisclosed
38Private & Confidential
39
▪ Announced: January 2016
▪ Consideration: $27m
▪ Multiples: EV/LTM sales: Undisclosed
▪ EV/LTM EBIT: Undisclosed
▪ Offer: All-cash
▪ Engagement type: Sell-side
▪ Sector: Outsourced software development
▪ Avendus role: Advisor to Blue Star Infotech
▪ Infogain provides front-end, customer-facingtechnologies, processes and applications that leadto a more efficient and streamlined customerexperience for enterprises across the globe
▪ Infogain is backed by Private Equity houseChrysCapital, a major Indian Private Equity housewith ~$3bn assets under management
▪ A technology consulting and services companywith 30+ years of full life cycle product engineeringexperience with 30+ customers served in TMTsector
▪ Strong focus on travel and hospitality segmentsand deep domain expertise in the hospitalitysector; developing a foothold into attractiveadjacent segments like payments and loyalty
CLI
ENT
SITU
ATI
ON
▪ Blue Star Infotech’s (BSIL) parent company, the Blue Star Group, was looking to sell off the non-core IT business andmerge the residual real estate business of BSIL back with the Blue Star
RES
ULT
▪ The conclusion of the process ended with 2 formal bidders, one US-based and one European
AV
END
US
RO
LE
▪ Avendus originated the idea of double flip as a white paper to Chrys Capital. As a part of this transaction, Chrys Capitalacquired Infogain first and then Infogain acquired the IT business of Blue Star Infotech
▪ Team successfully helped with complex structuring process involving a slump sale for a listed company
▪ Negotiated management incentive plan and aligned incentive of entrepreneur, management & other shareholders
acquired
Advisor to Blue Star Infotech
DEA
LR
ATI
ON
ALE ▪ The combined entity will have revenue of over $150 million, close to 4,000 employees and multiple global delivery
centres
▪ It will provide customers with digital transformation platform with capabilities in cloud, mobility, SAP, analytics, productengineering and test automation from locations in the US, the UK, Middle East, Singapore, Malaysia and India
$27m
TARGET PROFILETRANSACTION HIGHLIGHTS ACQUIRER PROFILE
39Private & Confidential
40
TARGET PROFILETRANSACTION HIGHLIGHTS ACQUIRER PROFILE
▪ Announced: December 2014
▪ Consideration: $74m
▪ Multiples: EV/LTM sales: Undisclosed
▪ EV/LTM EBIT: 10.5x
▪ Offer: All-cash
▪ Engagement type: Sell-side
▪ Sector: Outsourced software development
▪ Avendus role: Advisor to Aditi
▪ Symphony Teleca Corporation provides softwareproduct development, big data integration andanalytics services to ISVs, mobile and connectedsystems OEMs, and enterprises in all key verticals
▪ In April 2015, Symphony Teleca was acquired byHarman International
▪ A focused platform of scale in the outsourcedsoftware development segment with a favourableposition vis-à-vis competition
▪ Robust India-based offshore platform with over 10years of experience developing solutions forleading ISVs in a global delivery model, givingclients tangible economic benefits
▪ Significant business potential from ISVs/ ProductCompanies seeking migration to .NET platforms
CLI
ENT
SITU
ATI
ON
▪ Aditi Technologies had reached a certain revenue size and was looking to scale up its operations through a partnershipwith a global major
RES
ULT
▪ The conclusion of the process ended with 2 formal bidders, one US-based and one India-based
AV
END
US
RO
LE
▪ Worked closely with final counterparties to close out on most commercial, legal and structuring aspects of the dealprior to the selection of the final bidder and awarding exclusivity to ensure smooth process execution
▪ Demonstrated resilience and perseverance by ensuring both parties stay interested and committed to consummatingthe deal, over a lengthy deal execution cycle
DEA
LR
ATI
ON
ALE ▪ With this acquisition, STC extends its leadership in innovation to drive clients’ revenue growth by being able to uniquely
deliver Systems of Engagement (SoE)
▪ Aditi will serve as a strategic growth lever for STC through its design and cloud expertise, complementing STC’sengineering, mobile and analytics capabilities
acquired
$74m
Advisor to Aditi
40Private & Confidential
41Private & Confidential
42
$0.7bn$0.9bn
$1.2bn$1.4bn
$1.8bn
15.7% 15.5% 14.7%17.8% 18.2%
Dec-14 Dec-15 Dec-16 Dec-17E Dec-18ERevenue EBITDA margin, %
Sources: Capital IQ, Company website, One Source, Avendus Research
Professional Professional Title
Dobkin, Arkadiy CEO & President
Conte, Anthony Advisor
Peterson, Jason CFO
Shekhter, Elaina CMO
Fejes, Balaz Co-Head Global Business
Global provider of software product engineering, technology consulting and digital expertise
Investors
▪ EPAM is a global provider of software product engineering, technology consulting and digital expertise. Itsofferings include:
− Software Product Development: Product research, customer experience design and prototyping,program management, component design and integration, full lifecycle software testing, productdeployment, managed services, as well as porting and cross-platform migration
− Custom Application Development Services: Includes user experience design, component design andintegration, quality assurance and testing and legacy apps reengineering/refactoring
− Application Testing Services: Include software application testing; testing for enterprise IT, as well asdefect management; and consulting services
− Enterprise Application Platforms: Services in the areas of ERP, CRM, content management, businessintelligence, e-commerce, mobile, SaaS, and cloud deployment
− Application Maintenance and Support: Includes incident management, fault investigation, applicationbug fixes, release management, application enhancements & 3rd-party maintenance
− Infrastructure Management Services: End-to-end management services across network management,database, servers etc.
Corporate Information
Business Description
Board & Management
Financials (in USDm)
Rev by Geography
Headquarters Newtown, USAFounded 1993Number of Employees 22,383Reporting Currency USDRevenue $1.2bn (FY16)EBITDA $170m (FY16)Market Cap $6.2bn (08/01/2018)
Clients
CAGR 25%
Rev by Industry
Morgan Stanley Investment Management 8.7%
The Vanguard Group 7.7%
Fmr Llc 6.2%
Blackrock 5.8%
J.P. Morgan Asset Management 5.8%
Massachusetts Financial Services 4.0%
$1.2bn(FY16) 58%
36%
4%
2%
North America
Europe
CIS
APAC
$1.2bn(FY16)
Professional Professional Title
Dobkin, Arkadiy CEO & President
Conte, Anthony Advisor
Peterson, Jason CFO
Shekhter, Elaina CMO
Fejes, Balaz Co-Head Global Business
42
25%
23%21%
15%
9%7%
Financial Services
Travel &ConsumerSoftware & Hi-TechMedia & Ent.
Healthcare
Emerging Verticals
Private & Confidential
43Sources: Capital IQ as of 08 January 2018 Company website, One Source, Avendus Research 43
The Company has grown significantly through numerous acquisitions in 2014 and 2015
--
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6
9
12
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20
40
60
80
100
120
Feb-12 Dec-12 Oct-13 Aug-14 Jun-15 May-16 Mar-17 Jan-18
Vo
lum
e in m
illion
s
Shar
e P
rice
in $
(re
bas
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o E
PA
M)
Volume traded EPAM S&P 500
8 February 2012:Announced its IPO of 6.0m shares at $12.0 per share
23 May 2012:Acquired Toronto-based Thoughtcorp, a IT Consultancy and Software Solution Provider
18 December 2012:Acquired Empathy Lab, a digital strategy and multi-channel experience design firm
20 March 2014:Acquired New York-based Netsoft USA, a healthcare technology consulting firm
30 April 2014:Acquired China-based services firm Jointech
31 October 2014:Acquired Great Fridays, a UK-based product and service design group
16 November 2015:Acquired Alliance Global Services, a US-based software product development services firm
6 June 2014:Acquired GGA Software Services, a US-based healthcare & life sciences service provider
13 July 2015:Acquired NavigationArts, a US-based a digital strategy and experience design firm
22 June 2016:Acquired Dextrys, a China-based global provider of software engineering and application services
104%
691%
14.0
02 November 2017:Reports Q3 Sep 2017 results.Revenue up 26.6% y-o-yAdj. EPS up 7.9% y-o-y
Private & Confidential
44
62%14%
9%
6%9%Financial Services
Automotive
Telecom
Technology
Other
34%
30%
27%
5%3%1%
North America
Europe (excl. UK)
UK
Russia
APAC
Other
Sources: Capital IQ, Company website, One Source, Avendus Research
Professional Professional Title
Dobkin, Arkadiy CEO & President
Conte, Anthony Advisor
Peterson, Jason CFO
Shekhter, Elaina CMO
Fejes, Balaz Co-Head Global Business
Global Provider Of High-end Vertical Focused Software & Product Solutions
Investors
▪ Luxoft is a provider of software development services and innovative IT solutions to a global client base ofmore than 150 clients
▪ The company has Centers of Expertise (CoE) dedicated to R&D of each vertical focused domain practice. Itsofferings include:
− Financial Services: Upgradation of systems & processes for regulatory & reporting purposes, riskmanagement, data centralization, mobile technologies, transformation of internet based services
− Automotive and Transport: Solutions in fuel efficiency, EVs, infotainment, human-machine interfaces,ADAS and connected cars
− Travel and Aviation: Mobile based application development, big data processing, analytics, visualization,mobile booking systems, in-flight entertainment
− Technology: Product engineering that cover entire technology stack – services mainly in the area of IoT,embedded software, media processing algorithms, cloud based services and mobile apps
− Telecom: Services offered in the areas of Software Defined Networking (SDN) and Network FunctionVisualization (NFV)
− Energy: Services in the areas of green/renewable technologies; solutions for operational efficiency
Corporate Information
Business Description
Board & Management
Financials (in USDm)
Rev by Geography
Headquarters Zug, SwitzerlandFounded 2000Number of Employees 13,090Reporting Currency USDRevenue $785.6m (FY17)EBITDA $133.8m (FY17)Market Cap $2.0bn (08/01/2018)
Clients
CAGR 20%
Rev by Industry
$786m(FY17)
$786m(FY17)
Professional Professional Title
Loschinin, Dmitry CEO & President
Fetisov, Evgeny CFP
Friedland, Michael COO
Ziabkina, Natasha General Counsel
Plaia, Alina VP
Fmr LLC 6.6%
Wasatch Advisors 5.1%
Morgan Stanley Investment Management 4.0%
M&G Investment Management 3.4%
Blackrock 2.6%
J.P. Morgan Asset Management 2.4%
44
$0.5bn$0.7bn
$0.8bn$0.9bn
$1.1bn
19.0% 19.0% 17.0% 15.6% 16.0%
Mar-15 Mar-16 Mar-17 Mar-18E Mar-19ERevenue EBITDA margin, %
Private & Confidential
45Sources: Capital IQ as of 08 January 2018, Company website, One Source, Avendus Research 45
The Company has seen significant growth primarily through strategic acquisitions
--
3
6
9
12
--
10
20
30
40
50
60
70
80
90
Jun-13 Feb-14 Oct-14 Jun-15 Jan-16 Sep-16 May-17 Jan-18
Vo
lum
e in m
illion
s
Shar
e P
rice
in $
(re
bas
ed t
o L
uxo
ft)
Volume traded Luxoft S&P 500
20.4
72%
189%
26 June 2013:Announced its IPO of 4.1m shares at $17.0 per share
7 July 2014:Acquired Mecel PopulusSuite, a complete tool chain for designing, developing, and deploying user interfaces for distributed embedded systems, from Mecel AB
7 October 2014:Acquired Radius, a U.S.- based solution provider focused on the IoT industry
23 February 2016:Acquired SymtavisionGmbH, a provider of automotive software tools and consulting services
13 September 2016:Acquired Pelagicore AB, a Sweden-based provider of software platforms and services for In-Vehicle Infotainment Systems
18 February 2015:Acquired Excelian, a UK-based systems integrator and tech consulting company
18 July 2016:Acquired INSYS Group, an IT Management and Technology Consulting Firm
1 February 2017:Acquired IntroPro, an engineering consultancy
23 March 2017:Acquired derivIT, a Singapore-based financial services-focused technology consulting provider
16 November 2017:Reported Q2 Sep 2017 results. Revenue up 16.1% y-o-yAdj. EPS up 3.2% y-o-y
28 September 2017:Acquired Unafortis, Swiss-based wealth management consultancy
Private & Confidential
46
21%
20%
19%
16%
13%
11%Media & Ent.
Travel
Financial Serv.
Tech & Telecom
Professional Serv.
Others
81%
10%9%North
America
Latam and
Others
Europe
Professional Professional Title
Dobkin, Arkadiy CEO & President
Conte, Anthony Advisor
Peterson, Jason CFO
Shekhter, Elaina CMO
Fejes, Balaz Co-Head Global Business
Global provider of software product engineering, technology consulting and digital expertise
Investors
▪ Globant is an Argentina based company, providing IT services with strong focus on digital technologies. Itsofferings include:
− Consumer Experience: API management, e-commerce solutions, omni-channel experiences
− Gaming: Graphics engineering, game engineering, gaming experience, digital platform services
− Big Data: Scalable platforms and data integration, data architecture, visualization, data science
− Quality Engineering: Testing centre, test automation, mobile testing, load & performance testing
− Enterprise Consumerization: Talent management, cloud development, enterprise operations
− UX Design: Service design, user experience design, industrial design and visual design
− Mobile: Native development, product development, enterprise mobility
− Cloud Ops: Services around cloud operations and enabling DevOps culture
− Wearables and Internet of Things: Wearable application usability and interface design etc.
− Continuous Evolution: IT service management, software evolution, software archaeology
− Digital Content: Content management systems, e-learning solutions, digital marketing services
− Cognitive Computing: Rules engine, machine learning, and artificial intelligence based services
Corporate Information
Business Description
Board & Management
Financials (in USDm)
Rev by Geography
Headquarters LuxembourgFounded 2003Number of Employees 6,223Reporting Currency USDRevenue $323m (FY 16)EBITDA $61m (FY 16)Market Cap $1.7bn (08/01/2018)
Clients
CAGR 25%
Rev by Industry
Capital Research & Management Company 8.6%Morgan Stanley Investment Management 8.3%
J.P. Morgan Asset Management 6.2%
Riverbridge Partners 4.6%
Waddell & Reed Investment Management 4.6%
Wellington Management Group 3.9%
$323m(FY16)
$323m(FY16)
Professional Professional Title
Migoya, Martín Chairman & CEO
Nocetti, Néstor Co- Founder & EVP
Scannapieco, Alejandro CFO
Englebienne, Guibert CTO
Kanefsck, Natalia CAO
46Sources: Capital IQ, Company website, One Source, Avendus Research
$0.2bn$0.3bn
$0.3bn$0.4bn
$0.5bn
14.4% 12.3%18.9% 16.0% 17.0%
Dec-14 Dec-15 Dec-16 Dec-17E Dec-18E
Revenue EBITDA margin, %
Private & Confidential
47Sources: Capital IQ as of 08 January 2018, Company website, One Source, Avendus Research 47
The Company has constantly beaten the benchmark index with c.314% return since trading inception
--
3
6
9
12
--
5
10
15
20
25
30
35
40
45
50
Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18
Vo
lum
e in m
illion
s
Shar
e P
rice
in $
(re
bas
ed t
o G
lob
ant)
Volume traded Globant S&P 500
11.3
39%
314%
18 July 2014:Announced its IPO of 5.85m shares at $10.0 per share
27 March 2015:Announced a secondary offering of 3.5m shares at $18.5 per share
14 May 2015:Acquired Clarice Technologies, an outsourced software development company
9 July 2015:Announced a secondary offering of 3.5m shares at $28.3 per share
24 May 2016:Acquired WAE, a service design company
14 November 2016:Acquired Seattle-based L4, a digital services company
1 March 2017:Acquired Ratio, a digital services company
1 June 2017:Acquired PointSource, another digital services company
16 November2017:Reports Q3 Sep 2017 resultsRevenue up 33.2% y-o-yAdj. EPS up 13.3% y-o-y
Private & Confidential
48Private & Confidential
49The deals / figures mentioned above are across all Avendus Group Entities globally
49
Number of deals
Sell side / PE Buy side
CY 14 23 1
CY 15 25 2
CY 16 22 1
YTD CY17 20 1
AvendusFact Sheet
M&A Transactionswith deal value of
USD6.4Bn since 2007 including ~60 cross border transactions
Structured Credit Transactionswith deal value of
USD680 Mn since 2007
Employees Globally One of the largest
investment banking teams in India
Private Equity Transactionswith deal value of USD 4.5 Bn
since 2007
Consistently ranked among top Investment Banks in India
by deal count
Global Presencewith offices in 6 cities, 3 countries
Registered with FINRA in US & Financial Conduct Authority (FCA) in UK
USD1.4Bn
USD150Mn
30
100 119
200+
Assets under management in our Wealth Management business, 300+ families
Assets under management through our Technology and Public Funds
STRONG TRACK RECORD OF CLOSING M&A AND PE SYNDICATION DEALS WINNER OF SEVERAL AWARDS AND RECOGNITION
Investment Bank Of The Year
Private Equity- 2015
Asia’s 150 Most Promising Brands– 2014
Investment Banker Of The Year – 2009
Avendus KKR Strategic Relation – Long term partners to provide one stop shop for financial advisory services to entrepreneurs
Private & Confidential
5050
LIFE SCIENCES / HEALTHCARE
Generic Pharma, Contract Research & Manufacturing, Clinical Research (CRO), API &
Formulations, Agri-Inputs & Indian care providers
Acquired majority stake
Undisclosed
Advisor to: Devidayal
March 2011
Private Equity
Undisclosed
Advisor to: Devidayal
September 2015
ENTERPRISE TECHNOLOGY AND SERVICES
Technology, IT enabled Services, Business Process Outsourcing (BPO), Knowledge Process Outsourcing
(KPO), Analytics
Undisclosed
Advisor to: eInfochips
Jan-18
Has acquired
CONSUMER, FIG & BUSINESS SERVICES
Manufacturing & Services companies in Food & Beverages, Retail, Media, Business Services,
Education, Logistics & Financial Services
$140 Mn
Adviser to: TCNS
August 2016
Private Equity
$100 Mn
Advisor to: Ujjivan
March 2015
Private Equity
$60 Mn
Advisor to: Utkarsh
October 2016
Private Equity
INDUSTRIALS
Manufacturing & Services companies across Automotive, Heavy machinery, ancillary equipment,
Capital Goods, Transportation, Renewables & Process Industries
Has acquired
Undisclosed
Advisor to: Borosil
January 2016
Has Acquired
Undisclosed
Advisor to: Filtra
January 2016
Has acquired
Undisclosed
Advisor to: Borosil
July 2016
INFRASTRUCTURE
Power, Roads & Construction, Ports, Renewable Energy, Mining, Real Estate, Leisure & Commercial
Private Equity
$150 Mn
Advisor to: Diligent
May 2011
$25 Mn
Advisor to: Pristine
January 2015
Private Equity Private Equity
Undisclosed
Advisor to: Diligent
April 2013
DIGITAL MEDIA & TECHNOLOGY
Software & Hardware Technology platforms, Internet, Digital Media, Communication Tech,
Mobile Apps & Value added Services (VAS)
UndisclosedAdvisor to: TechProcess
February 2017
Has Acquired Private Equity
$50 MnAdvisor to: BYJU
September 2016
Undisclosed
Advisor to: Lohika
August 2016
Has acquired Private Equity
$56 MnAdvisor to: M&M
March 2017
Private Equity
$43 Mn
Advisor to: Paras
July 2017
Undisclosed
Advisor to: Laserline
July 2017
Has acquired
Private & Confidential
511) Since Jan 2008 by number of deals
51
» Have advised on ~100 transactions in the Enterprise Technology and Services space
» Global team of 20 professionals based out of US, Europe and Asia
» Strong track record of running successful global sale processes
• Lutech – One Equity Partners (’17), Mastek – TAISTech (‘16), Altran – Lohika (‘16), E2Open –
Orchestro (‘16), Infogain – Bluestar Infotech (‘16), Everstone / Solmark – Servion (’14),
Symphony Teleca – Aditi (‘14), Moody’s – Amba (’13), Webhelp – HEROtsc (’13), EXL – OPI
(‘11)
» Have advised on some of the largest M&A transactions in the global Enterprise Technology and Services
space in the last few years
• CVC – SPI Global, Mphasis - Digital Risk, Serco - Intelenet, iGate - Patni, Mahindra - Satyam
» Deep domain expertise enables us to provide theme based advisory by identifying future trends
• Up-to-date view on the strategic thinking of key players in the space, given a rich and extensive
relationship network in the sector
• Thought leadership in the Enterprise Technology and Services industry
Deal Segmentation1
Strong Sell / Buy-Side Experience1
77%
23%
M&A PE Syndication
65%
35%
Sellside Buyside
Avendus IT-BPO Employee Geography Split
24%
24%53%
US Europe India
Avendus Publications
Cloud ServicesOutsourced Product Development
UI/UX & Digital Transformation
Global Analytics Industry
Healthcare Technology Services
Private & Confidential
5252(1) Geography as seller – acquirer; (C) Indicates Avendus’ client; The above deals are a representative list of deals
(2) Pending closure
Avendus has advised on 60+ M&A and buy-out transactions since 2006 in the enterprise technology and services space
» Executed deal sizes ranging between $25 Mn – $1.2 Bn
Month Seller Acquirer Geography1
Jan-18(2) eInfochips C Arrow Electronics India – US
Dec-17 VisionaryRCM C Carlyle India – India
Aug-17 Tech Vulcan Synapse C India – US
Jul-17 Lutech / LaserLineC One Equity Partners Italy – US
Dec 16 TAISTech C Mastek US – India
Aug 16 Lohika C Altran US – France
Jun 16 Orchestro C E2open US – US
Oct 15 BlueStar IT business C Infogain India – US
Aug 15 CrossView C PFSweb US – US
Apr 15 CLX Europe eClerx C Italy – India
Jan 15 Sofgen C Tech Mahindra Switzerland – India
Jan 15 Rangsons Electronics Cyient C India – India
Dec 14 3i Infotech (W Europe) C Objectway SpA UK – Italy
Dec 14 Zeon Solutions C Perficient US – US
Dec 14 Aditi C Symphony Teleca India – US
Dec 14 Servion C Everstone, Solmark India – Singapore
Sep 14 Apex Analytix C Carousel Capital US – US
Aug 14 Professional Access C Zensar Technologies US – India
May 14 I-Cubed KPIT C US – India
Dec 13 Amba Research C Moody’s Corporation India – US
May 13 Learn2Perform KPIT C US – India
Month Seller Acquirer Geography1
Feb 13 HEROtsc C Webhelp UK – France
Feb 13 SPi Global CVC C Philippines-UK/HK
Dec 12 Digital Risk MphasiS C US – India
Jul 12 Vertex's Public Sector Serco C UK – UK
May 12 Agilyst eClerx C US – India
May 12 Promax Wipro C Australia – India
Nov 11 Laserwords SPi Global C India – Philippines
Jul 11 Nagarro C Allgeier Holding AG US – Germany
Jul 11 Intelenet Serco C India – UK
May 11 OPI C EXL US – US
May 11 SYSTIME C KPIT US – India
Jan 11 Patni C iGate India – US
Jan 11 WCI Consulting Take Solutions C UK – India
Aug 10 Venture Infotek C Atos Origin India – France
Feb 10 SMS C Genpact US – US
Nov 09 Sparta consulting C KPIT US – India
Apr 09 Satyam C Tech Mahindra India – India
Dec 08 Infovision C Serco India – UK
Nov 08 CMS C Blackstone India – US
Mar 08 STG C Mastek US – India
Dec 07 Datalinx C Aricent US – US
Private & Confidential
5353
» Satyam – Tech Mahindra: Successfully positioned & soldSatyam as a scaled up, offshore Technology asset despite thelack of credible financial info & turmoil at the company
» Atos Origin – Venture Infotek: Ran a competitive process,reaching out to over 30 companies globally and receivingoffers from 6 parties. Maintained competitive pressure till theend to maximize shareholder value
Avendus’ Experience In Positioning Assets & Running Complex Processes
Avendus’ Experience In Bringing Out -of-the-Box Investor Ideas To The Table
» eInfochips – Arrow: Sold an Indian engineering solutionscompany to an American electronics distribution and valueadded services player
» Lifetree – Tecnomen: Sold an Indian telecom solutionscompany to a Finnish strategic buyer
» Nagarro – Allgeier: Identified that European players with lack ofoffshore capabilities will be the most likely buyers
» InfoVision – Serco: Identified Serco, without any India presenceat that time as a likely buyer for InfoVision the 3rd largest Indiadomestic focused BPO at the time
Month Assets Global Bidders Investor
Jan-18 1 eInfochips 1 US, 2 fund Arrow Electronics
Dec-17 VisionaryRCM 1 fund Carlyle
Jul-17 Lutech 1 Europe, 2 funds One Equity Partners
Dec-16 TAISTech 3 US, 1 India Mastek
Aug-16 Lohika 2 Europe, 1 US, 1 India, 2 PE Altran
Jun-16 Orchestro 3 US, 2 PE E2open
Oct-15 BlueStar Infotech 1 US, 1 Europe Infogain
Aug-15 CrossView 2 US PFSweb
Jan-15 SOFGEN 1 Europe, 2 Asia Tech Mahindra
Jan-15 Zeon Solutions 2 US, 1 Asia, 1 fund Perficient
Dec-14 Servion 2 US, 1 Australia, 1 Asia, 2 PE Everstone/Solmark
Apr-14 Aditi 1 US, 3 Asia Symphony Teleca
Dec-13 Amba Research 2 US, 3 Asia Moody’s Corp.
Jun-13 Fractal Analytics 4 US, 1 Canada, 6 Asia TA Associates
Feb-13 HEROtsc 1 US, 4 Europe Webhelp
May-11 OPI Global 1 US, 3 Asia ExlService
Jan-11 Patni Computers 3 Asian, 5 funds iGate
Aug-10 Venture Infotek 2 Europe, 2 US, 2 Asia Atos Origin
Feb-10 SMS 1 US, 3 Asia Genpact
May-09 Lifetree 1 Europe TECNOMEN
Apr-09 Satyam 2 Asian, 1 fund Tech Mahindra
Dec-08 Infovision 1 Europe, 2 Asia Serco
Mar-08 STG 2 US, 1 Asia Mastek
Sep-07 Datalinx 2 US, 1 Asia Aricent
Sep-07 SCICOM 1 US, 2 Asia SAIC
Sep-07 Metamor 1 US, 1 Europe, 3 Asia Ciber
Mar-07 Focus Informatics 2 US, 1 Europe, 1 Asia Nuance
» We have a history of running very competitive mandates with more than three non binding offers in most transactions
» Our typical closing rates for transactions is in the 60% range
(1) Pending closure Private & Confidential
5454
• DOMAIN EXPERTISE & KNOWLEDGE LED ADVISORY SERVICES
• Domain Expertise & Thought Leadership:
» Deep insights into strategic priorities of Enterprise Technology and Services majors in India, US and Europe through board level relationships
» Strong understanding of deal drivers through extensive coverage of global and domestic companies
• Strong Research Based Sector Knowledge:
» Dedicated India, US & Europe geographic research teams covering the Enterprise Technology and Services sector comprehensively
» Continuous engagement with IT consortiums such as NASSCOM provides an extra edge in accurately predicting the sector trends
• Our Research Reports Have Actively Promoted Transactions In The Areas Covered:
Has acquired
$91 Mn
Advisor to: OPIMay 2011
Has acquired
$40 Mn
Advisor to: InfoVision
December 2008
Has acquired
Undisclosed
Advisor to: Vertex
September 2010
Has acquired
$36 Mn
May 2012Advisor to: Wipro
Private Equity
$25 Mn
Advisor to: Fractal
June 2013
Private & Confidential
5555
» Avendus Enterprise Technology and Services practice comprises of 20+ professionals based out of USA, Europe & India, with advisor based out of Japan
EXECUTIVE MANAGEMENT
GAURAV DEEPAK, CO-FOUNDER AND MANAGINGDIRECTOR
» Heads Investment Banking and oversees the Real Estate, Consumer & Industrial practice and Europe operations
» 18+ years of experience in Investment banking, Equity Capital Markets & Private Placements
» Worked with ICICI prior to founding Avendus
» B.Tech. from IIT, Kanpur and PGDM from IIM, Calcutta
KAUSHAL AGGARWAL, CO-FOUNDER AND MANAGING DIRECTOR
» Heads Institutional Equities and oversees the IT, ECM, Structured Finance and US operations
» 18+ years of experience in Investment banking & Equity Capital Markets
» Worked with Kotak Mahindra and CEA prior to founding Avendus
» B.Tech. from IIT, Delhi and PGDM from IIM, Bangalore
ABHINAV GOEL, Director
» Has worked with the Enterprise Technology and Services group atAvendus for 8+ years
» B.Tech. from IIT Kanpur and PGDM from IIM Lucknow
GLOBAL INTEGRATED IT / BPO TEAM
PUNEET SHIVAM, ED & HEAD – US & CO-HEAD – BPO
» 18+ years of experience in financial services & consulting
» Was Board Member and Head of Management Consulting at Inductis, aboutique management consulting firm, prior to joining Avendus
» B.Tech and M.E.M from IIT, Kanpur and PGDM from IIM, Ahmedabad
SHOBHIT JAIN, VP
» 12+ years of experience in investment banking of which 5+ yearsexperience in technology and media industry
» Worked at Kotak Investment Bank prior to joining Avendus
» Qualified Chartered Accountant
JEROME GLYNN SMITH, VP
» 8+ years of investment banking experience
» Previously worked with Deloitte Corporate Finance and J.P. MorganInvestment Banking
» M.B.A. from ESCP-EAP, European School of Management & PGPM fromIndian Institute of Management, Lucknow
SENIOR ADVISOR
EISUKE SAKAKIBARA, MEMBER ADVISORY COUNCIL
» Served as Japan’s Vice Minister of Finance and International Affairs
» Held multiple positions with the Govt. of Japan
» Key advisor to the Democratic Party of Japan
US
Ind
iaU
SE
uro
pe
AMIT SINGH, ED & HEAD- TECHNOLOGY & CO-HEAD – BPO
» 18+ years of experience in investment banking & technology industry
» Worked with Cambridge Technology Partners and PwC prior to joiningAvendus
» B.E. from BITS (Pilani) and PGDM from XIM, Bhubaneswar
Ind
ia
DEEPAK BHANDARI, HEAD OF EUROPE
» 20+ years of experience between UK and India
» Previously worked as the head of TMT coverage for Barclays InvestmentBanking (India) and as a Generalist at UBS (London)
» Qualified Chartered Accountant & MBA from London Business School
Eu
rop
e
Private & Confidential
56
December 2016
Undisclosed
Advisor to TAISTech
acquired acquired
July 2016
Undisclosed
Advisor to Lohika
acquired
July 2016
Undisclosed
Advisor to Orchestro
invested in
June 2016
$32m
Advisor to Lendingkart
acquired
December 2016
$35m
Advisor to Amagi
acquired
January 2016
$28m
Advisor to BSIL
April 2015
$25m
Advisor to eClerx
acquired
acquired
January 2015
Undisclosed
Advisor to Sofgen
(W.-Eur.)
acquired
December 2014
Undisclosed
Advisor to 3i Infotech
acquired
December 2014
Undisclosed
Advisor to Zeon
acquired
August 2014
Undisclosed
Advisor to PA
invested in
June 2013
Undisclosed
Advisor to Fractal
acquired
February 2013
$110m
Advisor to HeroTSC
acquired
February 2013
Undisclosed
Advisor to CVC
Advisor to Crossview
acquired
August 2015
$38m
Advisor to TechProcess
acquired
January 2017
Undisclosed
acquired
April 2017
Undisclosed
Advisor to SVG Advisor to TechProcess
Advisor to CrossView
acquired
July 2017
Undisclosed
Advisor to Laserline
acquired
August 2017
Undisclosed
Advisor to Synapse
acquired
Dec 2017
Undisclosed
Advisor to VRCM
acquired
Jan 2018
Undisclosed
Advisor to eInfochips
Private & Confidential
57
Avendus Capital Private Limited : CIN : U99999MH1999PTC123358 | SEBI Registration no. : Merchant Banking - INM000011021 | Avendus Wealth Management Private Limited : CIN :U67120MH2008PTC179931 | SEBI Registration no.: PMS - INP000003625 | SEC - USA : CRD No. 156771 | Avendus Capital, Inc: FINRA-USA: CRD No. – 150160 | Avendus Capital(UK) Private Limited:Authorised and regulated by the Financial Conduct Authority (493919) | Avezo Advisors Pvt. Ltd.: CIN: U74120MH2014PTC255373 | SEBI Registration No. Portfolio Manager - INP000004607 |Manager to SEBI registered Category - I Alternative Investment Fund - Zodius Technology Fund - IN/AIF1/14-15/0126 | Manager to SEBI registered Category III Alternative Investment Fund-Avendus India Opportunities Fund III - IN/AIF3/12-13/0033
Regus Business Centre, PS Arcadia, Office No 927, 9th Floor, Unit No.C, 4A, CamacStreet, Kolkata – 700 016
Avendus Capital (U.K.), Private Limited33, St James's Square, London SW1Y 4JS
Avendus Capital Inc., 499 Park Avenue, 12th Floor, New York, NY 10022
IL&FS Financial Centre, C & D Quadrant - 6th Floor Bandra-Kurla Complex, Bandra (East), Mumbai -400 051
901-B, Time Tower, M.G.Road,Gurgaon, Haryana – 122002
The Millennia Tower, A -10th Floor, No 1 & 2, Murphy Road, Ulsoor Bangalore - 560 008
Private & Confidential
58
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For the purposes of distribution within the United Kingdom, this communication is exempt from the financial promotion restriction in Section 21 of the Financial Services andMarkets Act, 2000 relating to the communication of an invitation or inducement to engage in investment activity on the grounds that it is made to those persons falling within thefollowing Articles of the Financial Services and Markets Act 2000 (Financial Promotion)Order 2005, as amended: Article 19 (Investment Professionals) and Article 49 (High NetWorth Companies). Any investment to which this communication relates is only available to investment professionals and high net worth companies.If you have received this document and you are not the person for whom it is intended, you should not rely on this communication or act on it.
Private & Confidential