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Arma Partners Corporate Overview July 2010 Arma Partners Corporate Overview July 2010 Presentation Transcript

  • Corporate Overview July 2010
  • Contents I. Overview of Arma Partners II. Senior team members III. Selected case studies Europe Americas Arma Partners LLP Arma Partners LLC 16 Berkeley Street Four Palo Alto Square, Suite 100 London W1J 8DZ 3000 El Camino Real United Kingdom Palo Alto, CA 94306 United States Tel: +44 (0) 207 290 8100 Tel: +1 650 328 8207 http://www.armapartners.com Arma Partners LLP is authorised and regulated by the Financial Services Authority (FSA) US Arma Partners LP is regulated by the Financial Industry Regulatory Authority (FINRA) and is a member of the Securities Investor Protection Corporation (SIPC) 2
  • I. Overview of Arma Partners 3
  • About Arma Partners Arma Partners is a specialist Technology, Media and Telecoms (TMT) corporate finance advisory firm founded in March 2003 Arma is committed to serving TMT companies with experienced bankers who have deep sector knowledge and significant transaction execution expertise Mergers & Acquisitions Board Advisory Capital Markets Advisory Core expertise in providing mergers Provide advice to executive Help companies assess the and acquisitions advice to our management and Board members appropriateness of an IPO and clients, including both buy side and on issues relating to shareholder assist clients throughout the sell side services with an unbiased value and corporate performance lifecycle of the IPO process and objective approach Advise Boards on fairness of terms (positioning through pricing) Assist our clients in achieving their of transactions from a financial Provide an unbiased view based on strategic objectives and maximising point of view and ensure that our extensive experience of US shareholder value Boards are giving, or receiving, fair and European stock exchanges Leverage our network of industry value Leverage our network of relationships, wealth of transaction Analyse the valuation and structure relationships to assist private expertise and understanding of the of a transaction, the form and companies obtain the growth TMT landscape to help our clients timing of consideration and the capital they require achieve optimal results financial implications Services Provided Services Provided Services Provided Public and private acquisitions Transaction structuring IPO advice Public and private mergers Strategic options assessment Private placements Divestitures Fairness opinions Recapitalisations Management buyouts Capital markets advice 4
  • Meeting our clients’ requirements Requirements Arma Partners’ Fit Considerable execution experience from “bulge bracket” and “boutique” firms Transaction expertise Announced transactions span three continents and fifteen countries Deep understanding of relevant Technology, Media and Telecom markets and Industry insight sectors Ability to optimally position our clients’ businesses to maximise shareholder value Access to key industry Strong relationships with aggregators, emerging companies and investors worldwide participants Ongoing dialogue to understand their strategic and financial objectives Ability to Led some of the highest value exits in the TMT sector maximise value Proven ability to achieve exceptional strategic value Analysis of Unbiased and independent advice on selecting the best strategic alternative available options High level of experience with potential bidders in deal situations Senior-level involvement from conception to closing Commitment of team Exceptional level of client satisfaction and ‘referenceability’ 5
  • Arma’s sector focus Deep in-house knowledge and understanding of Technology, Media and Telecom markets worldwide Extensive transaction experience and understanding of value drivers across sectors and geographies Ongoing dialogue and extensive ‘C-level’ relationships with key industry participants including emerging companies, aggregators and financial investors Ongoing commitment to publish proprietary research on relevant sectors (e.g. thought-pieces, sector reports, white papers etc.) Examples of thought-pieces Regular publications Enterprise Software Financial Technology Security Software Open Source Financial Technology Report White Papers Software-as- a-Service Cloud Computing Web 2.0 IMS / SIP Creative Digital Home Internet & Web 2.0 Location-based services Gaming / Gambling Destruction Enterprise Mobility Telecom Mobile Technology IT services Semiconductors Published every two months. The report covers valuation metrics, M&A / private equity activity and provides market commentary as well as a spotlight on a chosen subsector 6
  • Selected announced transactions Jun 10 Jun 10 Jun 10 Nov 09 Sep 09 Undisclosed c.$260,000,000 $75,000,000 $409,000,000 $25,000,000,000 (pending) (pending) (withdrawn) growth equity investment by has been acquired by has acquired has been acquired by Acquisition of a stake by Exclusive financial advisor Lead financial advisor to Lead financial advisor to Exclusive financial advisor to Financial advisor to to Acturis Ltd PriceMinister Deltek Inc freenet AG MTN Financial Software Digital Media Enterprise Software Internet services Telecom Jul 09 Jul 09 May 09 May 09 May 09 $680,000,000 $42,000,000 $172,000,000 $113,000,000 $80,000,000 (DSL division) has acquired the Application has acquired has acquired has been acquired by has acquired Testing / ASQ business of Exclusive financial advisor Exclusive financial advisor to Exclusive financial advisor to Exclusive financial advisor to Exclusive financial advisor to to Software AG F-Secure Corporation freenet AG Micro Focus Int’l plc Micro Focus Int’l plc Enterprise Software Security Software Internet services Enterprise Software Enterprise Software 7
  • Selected announced transactions (cont’d) Mar 09 Jan 09 Dec 08 Dec 08 Sep 08 $100,000,000 Undisclosed $30,000,000 Undisclosed $50,000,000 has been acquired by has been acquired by has been acquired by has acquired has been acquired by & subsequently merged with Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor to Exclusive financial advisor to Financial and Rule 3 advisor to to Snell & Wilcox Group to Danet Group Wayfinder Systems AB Micro Focus Int’l plc SPI Lasers plc Digital Media IT Services Mobility Software Enterprise Software Optics Aug 08 Jun 08 Apr 08 Apr 08 Feb 08 $108,000,000 $73,000,000 $2,550,000,000 Undisclosed has been acquired by evaluated a potential has acquired has acquired has been acquired by acquisition of Exclusive financial advisor Lead financial advisor to Exclusive financial advisor Exclusive financial advisor to Financial advisor to to Micro Focus freenet AG to Cape Clear Software Anite plc Software AG International plc Inc. IT services Enterprise software Enterprise Software Mobile services Enterprise Software 8
  • Selected announced transactions (cont’d) Jan 08 Dec 07 Apr 07 Apr 07 Jan 07 Undisclosed $110,000,000 $124,000,000 $546,000,000 $39,000,000 has acquired the German B2C has acquired has been acquired by has acquired has acquired broadband and narrowband customer contracts of Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor to Odyssey Financial to GloNav, Inc. to royalblue group plc to Software AG to freenet.de AG Technologies, S.A. Financial Software Semiconductors Financial Software Enterprise Software Internet Services Jan 07 Nov 06 Jun 06 Jan 06 Jun 05 $75,000,000 $124,000,000 Undisclosed $106,000,000 $55,000,000 a business unit of IGE I recapitalisation with equity has been acquired by has been acquired by has been acquired by investment by has been acquired by Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor to Exclusive financial advisor Exclusive financial advisor to NordNav Technologies to Kreatel Inca Digital Printers Ltd to Elektrobit Group plc to IGEFI S.à.r.l AB Communications AB Semiconductors Telecom Software Financial Software IPTV Technology Printing Technology 9
  • Selected announced transactions (cont’d) Apr 05 Dec 04 Dec 04 Nov 04 Oct 04 Undisclosed $94,000,000 Undisclosed $52,000,000 $112,000,000 has been acquired by has been acquired by has been acquired by has been acquired by has been acquired by Exclusive financial advisor to Exclusive financial advisor to Exclusive financial advisor to Exclusive financial advisor to Exclusive financial advisor to Ubitrade SA Mosaic Software Holdings Ltd Dione Plc Cirpack S.A.S S.E.S.A AG Telecom Software IT Services Financial Software Financial Software Payment Technology 04-05 Jan 04 Dec 03 Nov 03 $45,000,000 (agg.) $44,000,000 Undisclosed $210,000,000 European Anite Group’s disposal of: Technology Deal of the to Year 2003 and other investors to Financière has been acquired by have acquired has been acquired by RDM to Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor to Anite Group Plc to NXN Software AG to Apax Partners to SUSE Linux AG Software & Services Digital Media Financial Software Open Source 10
  • Established long-term ‘trusted advisor’ relationships Apr 08 Dec 08 May 09 May 09 $73,000,000 Undisclosed $113,000,000 $80,000,000 Having completed a successful turnaround of the business, the new management team brought in Arma to help identify and action suitable opportunities in line with the acquisition has acquired the Application has acquired has acquired has acquired Testing / ASQ business of strategy outlined in 2006 Arma Partners worked seamlessly with Micro Focus’s Exclusive financial advisor Exclusive financial advisor to Exclusive financial advisor to Exclusive financial advisor to internal team and successfully completed 4 transactions to Micro Focus International plc Micro Focus Int’l plc Micro Focus Int’l plc Micro Focus Int’l plc over the last 12 months including 3 deals involving NASDAQ-listed public companies Enterprise Software Enterprise Software Enterprise Software Enterprise Software Apr 07 Jun 08 Jul 09 Arma Partners has a long-standing relationship with $546,000,000 $680,000,000 Software AG and has contributed positively to the company’s ongoing strategic target search exercise Senior-level has acquired evaluated a potential acquisition of has acquired webMethods represented Software AG’s first attention transformational acquisition creating a global SOA leader Exclusive financial advisor Financial advisor Exclusive financial advisor The acquisition of IDS Scheer creates a global enterprise to Software AG to Software AG to Software AG software vendor with more than 6,000 employees and over €1 billion in sales Enterprise Software Enterprise Software Enterprise Software Jan 07 Apr 08 May 09 Nov 09 freenet are currently transforming their business to position $39,000,000 $2,550,000,000 $172,000,000 $409,000,000 themselves as the leading telecoms player in Germany has acquired the German Arma worked closely with the CEO and CFO over a three (DSL division) B2C broadband and narrowband customer has acquired has been acquired by has been acquired by year period developing the company’s M&A strategy contracts of Arma was retained as lead financial advisor on the landmark Exclusive financial advisor Lead financial advisor to Exclusive financial advisor to Exclusive financial advisor to $2.6bn transformational acquisition of debitel and was to freenet.de AG freenet AG freenet AG freenet AG recently mandated to run a public auction process for the sale of freenet’s Strato web hosting business Internet Services Mobile services Internet services Internet services Aug 04 Feb 05 Apr 05 Aug 08 Arma has had a relationship with Anite for over 5 years and $45,000,000(agg.) $45,000,000 (agg.) $45,000,000 (agg.) $108,000,000 Anite Group’s disposal of: Anite Group’s disposal of: Anite Group’s disposal of: has helped transform the group, through divestments and acquisitions, from a multi-divisional IT conglomerate into a software company focused on the wireless and travel has been acquired by to to verticals to Financière RDM Arma’s in-depth understanding of the Technology industry, Exclusive financial advisor Exclusive financial advisor Exclusive financial advisor Financial advisor to Anite plc ability to give independent advice, strong execution to Anite Group Plc to Anite Group Plc to Anite Group Plc capabilities and stability of the core team have enabled Arma to become Anite’s trusted advisor Software & Services Software & Services Software & Services IT services 11
  • II. Senior team members 12
  • Senior team members Paul-Noël Guély Founding Partner of the firm. Previously was a senior Technology banker with Goldman Sachs, responsible for some of the firm’s largest European clients, headed up Lehman Brothers' European Technology Group, and worked in M&A for Morgan Grenfell & Co. (now Deutsche Bank). Paul has for 20 years executed M&A and capital-raising transactions for established companies such as SAP, Software AG and STM, as well as emerging leaders, several of which he has taken public (LSE listing of Autonomy, NASDAQ listing of Baltimore Technologies, Frankfurt IPO of Software AG, Paris IPO of InfoVista, etc.) John Meehan Founding member of Arma Partners and promoted to Partner in 2007. Previous experience includes seven years working in the investment banking divisions of Goldman Sachs, Lehman Brothers and BZW in London, New York and Paris with a particular focus on the technology sector. With Arma John focuses in particular on the Financial Technology sector, and heads the firm’s activities in this area. John is a graduate of University College Dublin (Ireland) where he received a BComm International. He also holds the Diplôme d’HEC (France) James Schroder Joined Arma Partners in September 2008. Previously was a senior Technology banker with Lehman Brothers and Montgomery & Co. with over 15 years of investment banking and professional experience in Silicon Valley, New York and London. Successfully led transactions for leading technology companies in the US, Europe and Asia representing about $30 billion in M&A and $3 billion in public and private financing, including the sale of Sorenson Communications to GTCR, the $1 billion LBO of Aspect Software and the $1 billion acquisition of Content Technologies by Baltimore Technologies. Earlier in his career he was a Strategy Consultant and served as a Nuclear Submarine Officer on board a fast attack nuclear submarine Tom Wells Joined Arma Partners in 2009. Previously with Merrill Lynch, where he was a Managing Director and Head of Telecom Investment Banking for Europe, the Middle East & Africa, based in London. Prior to that Tom was a Managing Director in the European Telecom Investment Banking team at Citigroup. Before Merrill Lynch and Citigroup, Tom was Head of Corporate Finance for British Telecom. During his 15 years working within the telecom sector Tom has advised many of the leading operators on over $150 billion worth of transactions, including BT, O2, Cable & Wireless, BSkyB, Deutsche Telekom, TDC, TeliaSonera, Belgacom, KPN, Telekom Austria, Portugal Telecom, MTN, Bharti Airtel, China Mobile and MegaFon. Tom began his career with Coopers & Lybrand, where he qualified as a Chartered Accountant and a Chartered Financial Analyst 13
  • Senior team members (cont’d) Eric Lawson-Smith Joined Arma Partners in 2009. Most recently, Managing Director and Head of European Digital Media at Jefferies. Previously one of the founding partners and a Managing Director of LongAcre Partners for 7 years where he was responsible for a number of high- profile digital media transactions including the sales of Friends Reunited, uSwitch and Datamonitor and the acquisitions of Emap by Guardian Media Group / Apax and VNU Business Media Europe by 3i. Eric has also led recapitalisations and refinancings for a large number of Europe’s most successful digital media companies, including Seatwave, Moneybookers, DailyMotion and The Mill. Prior to LongAcre, Eric was a Principal at Broadview and Vice President at JP Morgan. Eric began his career with Prudential Investment Corporation in New York, completing investments for that group in a number of media properties Adam de Courcy Ling Joined the firm in November 2003. Previously head of Credit Suisse First Boston’s European technology M&A practice from 2000 to 2003. Advised Sema in its $5.5 billion sale to Schlumberger and Freeserve in its $2.2 billion sale to Wanadoo. Spent 12 years as a mergers and acquisitions banker at CSFB, becoming a managing director in 1998. Prior to 2000, led the bank’s M&A advisory practice in Germany, advising clients such as Chrysler (on its $38 billion merger with Daimler-Benz), Thyssen (on its $3 billion merger with Hoesch-Krupp) and Deutsche Post. Also spent 10 months in 2003 working for the UK government on the $8 billion financial restructuring of British Energy Steve Smith Joined Arma Partners in August 2006. Steve has over 30 years of experience in Silicon Valley and is one of the best known senior M&A bankers to technology companies in the region. Previously, Steve spent 14 years at Broadview, where he was Vice Chairman, served on the management committee and led the Silicon Valley M&A advisory team as well as the global practice group in the infrastructure sectors of the IT market. Earlier in his career, Steve held senior roles at McKinsey, Fairchild, and Amdahl and was CEO of Reference Technology. Since Broadview, Steve has been a Managing Director with The Interim CEO Network and has recruited numerous CEOs to technology companies 14
  • Senior team members (cont’d) David Sola Joined Arma Partners in September 2007. Previously, spent 7 years building, managing and realising the Softbank Europe Ventures portfolio of early-stage technology companies, including Picsel Technologies, Consul Risk Management and Volantis Systems. Prior to Softbank, he was Co-Head of Mergers & Acquisitions, Europe at UBS Investment Bank, where he grew the M&A team from 20 to 70 bankers and over 9 years was the lead M&A banker on over $55 billion of completed transactions, including PCCW’s $38 billion acquisition of Hong Kong Telecom, Assicurazioni Generali’s $12 billion acquisition of INA, and Dow Chemical’s $600 million acquisition of Sentrachem. Earlier in his career he worked in First Boston’s M&A Group in New York, and with the law firm Wachtell, Lipton, Rosen & Katz Rex Golding Joined Arma Partners in 2009. Previously, spent over 7 years as Managing Director of Mobius Venture Capital, investing in software, security and Web-based companies and achieving a number of successful M&A exits. Prior to Mobius, Rex was Co-Head of the Technology Banking Group at Morgan Stanley, where he oversaw over $20 billion of IPOs and other public financings, advised on over $150 billion of M&A transactions and personally led a number of high-profile transactions for Amazon.com, Microsoft, Netscape, Oracle, Verisign, and many other premier technology companies globally. Before Morgan Stanley, Rex was a technology entrepreneur at the 3DO Company and OnLive! Technologies. Earlier in his career Rex was an investment banker at Volpe, Welty & Co., E.F. Hutton & Co., and Salomon Brothers Inc. Markus Salolainen Joined Arma Partners in April 2009. Previously was a Managing Director at Straumur, the Nordic bank, from 2007 to 2009 where he originated and closed LBO transactions, secondary private equity deals and M&A transactions, with a strong focus on Technology and Telecoms. From 2000 to 2007, Markus was a General Partner at Nokia Growth Partners and a Principal at BlueRun Ventures. Growth stage investment activity at Nokia Growth Partners leveraged the fund’s close relationship with the Nokia organisation. Select investments included Bitboys (acquired by ATI), Heptagon, Coding Technologies (acquired by Dolby) and Sasken (IPO in India). Early-stage VC investment activity at BlueRun Ventures involved new investments and in-house M&A advisory. Select investments included Enpocket (acquired by Nokia), Wavemarket, Frontier Silicon and Cerebra (acquired by webMethods) 15
  • Senior team members (cont’d) Matthew Gehl Joined Arma Partners in September 2006. Previously, was the senior equity research analyst for the European semiconductor and semiconductor equipment sector at Goldman Sachs in London. Spent a total of 7 years with Goldman Sachs, including 2 years in New York and 2 years in Frankfurt, before moving to London. He was a ranked analyst in the Greenwich Associates investor poll for the European Semiconductor sector. Matt received a BBA with distinction from the University of Wisconsin with a double major in Finance and Accounting and a minor in International Business. Matt speaks German Keith Robinson Joined Arma Partners in August 2004. Previous experience includes strategic consulting in the Market & Business Strategy practice of Gartner, technology consulting with Scient Corporation in New York and Tokyo, and investment banking with JPMorgan. Keith’s current focus areas include Enterprise Software, Mobile Value-added Services, and Internet / eCommerce. Keith received a B.S. in Economics with concentrations in Finance and Entrepreneurial Management from the Wharton School at the University of Pennsylvania and an MBA from INSEAD Stewart Hindley Joined Arma Partners in 2010. Previously, was a Vice President at Montgomery & Co., where he focused on M&A advisory services for technology companies. He has nine years of investment banking experience and has led numerous successful transactions to both strategic and financial buyers across the technology and Internet sectors. Stewart holds a BS in Management Science from UC San Diego (summa cum laude). He is a dual citizen of the U.S.A. and Australia 16
  • III. Selected case studies 17
  • Case study: Acturis – growth equity investment from Summit Partners Transaction highlights Acquirer profile Target profile Consideration: Undisclosed Summit Partners is a private equity and Founded in 2000 and based in London, venture capital firm with offices in Boston, Acturis provides technology solutions to Offer: Undisclosed London and Palo Alto general insurance brokers, underwriters and affinity networks Key metrics (YE Sept 09): Revenue: £14.1m; Formed in 1984, the firm has raised nearly Operating Profit: £5.1m $11 billion in capital in its private equity, The Acturis Platform automates insurance venture capital, and subordinated debt funds administration and enables multi-channel Engagement type: Private sell-side (growth equity implementations as well as electronic trading investment) Summit has provided financing to more than of insurance products 300 companies, which have completed more Sector: Financial technology than 125 public offerings, and in excess of Acturis’s platform is used by more than 7,000 125 strategic mergers or sales users across 300 sites and processes more Arma role: Exclusive financial advisor to Acturis Ltd. than £2bn of Gross Written Premium annually The investment will position the company for the next stage in its growth, help execute its European June 21, 2010 expansion strategy and continue the company’s focus on delivering best-in-class technology Deal rationale The transaction is part of Summit Partners' strategy to invest in growing, profitable software Undisclosed companies with a strong market position. Summit Partners have a strong history of investing in the financial services technology sector, including investments in Flow Traders, IGEFI Group, Fleetcor and Fortegra Financial The transaction will allow existing shareholders to partially exit the business while retaining a majority stake Scott Collins (Managing Director) and Han Sikkens (Principal) of Summit Partners, will join the Acturis Board of Directors growth equity investment by Arma Partners was engaged by Acturis shareholders to evaluate the company's strategic options Contribution / impact Arma Partners worked closely with the shareholders to define a list of investment criteria and agree on the optimal transaction structure to maximise value using both debt and equity financings The highly focused approach, emphasising both the tangible and non-tangible aspects of the Arma Partners acted as exclusive financial transaction, enabled shareholders to evaluate their alternatives in a very short time frame advisor to Acturis Ltd. All of the key points of the transaction were negotiated up-front in a detailed term sheet, whilst there was still competitive tension A short period of exclusivity was granted to Summit Partners to complete due diligence, arrange bank financing and negotiate all deal documents 18
  • Case study: PriceMinister acquired by Rakuten Transaction highlights Acquirer profile Target profile Consideration: c. €200 million In Japan, Rakuten has approximately 64 Founded in 2000, PriceMinister is the largest million registered members and sales in 2009 e-Commerce site in France by audience Offer: Cash totalled US$3.2 billion In addition to France, PriceMinister has established its marketplace business in Spain Key metrics: c.5x historical revenue and 28x EBIT Its core business “Rakuten Ichiba” is Japan’s and the United Kingdom largest Internet shopping mall and offers more Engagement type: Private sell-side than 58 million products from over 33,000 It has become the European leader in merchants, some of whom have turnover of guaranteed buying and selling on the Internet Sector: eCommerce more than US$1 million per month It consists of five business lines: Guaranteed Buying and Selling (marketplace), Automobile Arma role: Financial advisor to PriceMinister S.A. It is engaged in other Internet businesses (classifieds), Travel (price comparison), Real such as a travel agency and financial services estate (classifieds) and E-mail Marketing June 17, 2010 This acquisition is a significant step toward Rakuten’s objective to create a global shopping platform. Further, the transaction will also develop its global network of e-commerce businesses by leveraging Deal rationale its presence in Asia, the US and Europe c. €200,000,000 With Rakuten’s deep knowledge of how to build long term relationships with merchants and consumers and B2B2C marketplace business model, PriceMinister can grow even faster by combining both respective strengths Post completion, PriceMinister management team will continue to work with the company to continue to develop the platform in France and across Europe and its subsidiaries have been acquired by PriceMinister had received inbound expressions of interest due to its unique position in the Contribution / impact European B2B2C marketplaces landscape Arma combined these approaches with focused enquiries of a small handful of other relevant players to create a highly targeted and discreet sale process Arma also worked with management to articulate PriceMinister’s European growth strategy Arma Partners acted as financial advisor to PriceMinister S.A. Once Rakuten had been identified as the strongest buyer, Arma, together with the management team, was able to drive this successful process to completion within a compact timeframe The transaction valuation provides a highly attractive return for the shareholders and financial investors, and Rakuten can take advantage of synergy opportunities as it leverages its B2B2C expertise within PriceMinister’s European platform 19
  • Case study: Strato acquired by Deutsche Telekom Transaction highlights Acquirer profile Target profile Consideration: $409 million With presence in 50 countries worldwide and Headquartered in Berlin, Germany, Strato AG a market capitalisation of over €42 billion, provides subscription-based, on-demand Offer: Cash Deutsche Telekom is one the world’s leading managed software, supplied around a shared telecommunications and information or dedicated hosted domain and web space Key metrics: 3.05x LTM revenue technology companies offering The company increasingly adds SaaS Engagement type: Private sell-side Deutsche Telekom provides network access, offerings for business users, such as communications services and value-added homepage builder, fully-equipped eShops and Sector: Webhosting services via fixed and mobile networks online storage and back-up Arma role: Exclusive financial advisor to freenet AG Measured by 1.4m subscription contracts and over 4m hosted domains, Strato is the number 2 web hoster in Europe The transaction makes Deutsche Telekom number two for webhosting products in Germany November 19, 2009 Strato enlarges Deutsche Telekom’s existing webhosting platform, providing the combined business Deal rationale with attractive opportunities for further growth domestically and in the rest of Europe and expands $409,000,000 Deutsche Telekom’s value-added services offers to residential and SME customers Strato will make a positive contribution to net income and free cash flow to Deutsche Telekom The disposal of Strato marks the continuation of freenet’s strategy to concentrate on mobile and mobile Internet, which freenet embarked on after acquiring debitel in July 2008 has been acquired by Arma Partners has a longstanding relationship with freenet, having been retained as lead financial advisor on four assignments, including the transformational €1.6bn acquisition of debitel in 2008 Contribution / impact Arma structured a two stage auction process for Strato, with Stage 1 focusing on educating potential acquirers about the value and potential of Strato’s unusual, software-centric, managed webhosting business model Arma Partners acted as exclusive financial Arma proactively contacted buyers on a global basis as well as evaluated inbound expressions of advisor to freenet AG interest. A rigorous selection process was used so as to maintain a manageable process in an environment of extremely strong buyer interest The process was constructed to meet the detailed requirements both of strategic and of financial buyers, including the needs of financing providers Through a carefully executed process, Arma managed to maximise the exit value for freenet AG 20
  • Case study: Software AG acquires IDS Scheer Transaction highlights Acquirer profile Target profile Consideration: $680 million Software AG (XTRA: SOW) is the world’s IDS Scheer (XTRA: IDS) is the worldwide largest independent provider of Business market leader in business process analysis Offer: All cash, €15 per share (40% premium to Infrastructure Software and optimisation solutions previous close) Product portfolio includes solutions for high Offers software solutions in Business Process performance data management, applications Analysis and Enterprise Architecture Key metrics: 1.0x historic revenue modernisation, service-oriented architecture Technology enablement and business processes Formidable business process and SAP Engagement type: Public buy-side improvement implementation professional services capability Software AG is headquartered in Darmstadt IDS Scheer is headquartered in Saarbrucken Sector: Enterprise Software / IT Services (Germany) with over 3,600 employees serving (Germany) with 2,800 employees serving 4,000 customers in 70 countries 7,500 customers in 70 countries Arma role: Exclusive financial advisor to Software AG The transaction will create a global player in infrastructure software and business process solutions July 13, 2009 with more than 6,400 employees and in excess of €1 billion in revenue Deal rationale Software AG’s strengths - technology leadership in middleware software, financial strength and a $680,000,000 global presence - will complement IDS Scheer’s strengths - the modeling, implementation and controlling of business processes , a strong partner network and a large service presence in their 7,500 strong customer base The joint company strategy is focused on growth driven by the combined product offering, enhanced market access and the leverage provided by the specialist expertise of IDS Scheer's consulting business to deliver the combined entity’s software solutions has been acquired by Arma Partners, working in close concert with the Software AG management team, leveraged its sector knowledge to proactively identify suitable acquisition opportunities for the company Contribution / impact Developed an acquisition strategy which enabled Software AG to secure the support of the two co- founders and largest shareholders (professor Scheer and professor Pocsay) thereby achieving the highest possible ownership level in IDS Scheer ahead of announcing the public tender offer Arma Partners acted as exclusive financial Worked closely with Software AG’s team to conduct due diligence on the target, execute an offer advisor to Software AG strategy and agree the terms of sale Arma Partners developed a negotiation and communication strategy for Software AG’s Board to drive relevant major shareholders to accept the offer 21
  • Case study: freenet’s DSL Internet access business acquired by United Internet Transaction highlights Acquirer profile Target profile Consideration: $172 million United Internet is a leading German Internet With 1.2 million subscribers, freenet’s DSL Service Provider with global operations, business is the 5th largest broadband Internet Offer: Cash and shares delivering value-added Internet services, Service Provider in Germany comprising DSL and narrowband Internet Key metrics: 0.42x LTM revenue access, webhosting and information freenet’s DSL business already offers not only management, to SoHos, SMBs and retail regional but also nationwide Unbundled Local Engagement type: Private sell-side customers Loop services, based on regulated IP- Bitstream access to Deutsche Telekom’s Sector: Internet access In addition to Internet services, United Internet access infrastructure provides a wide range of marketing and sales Arma role: Exclusive financial advisor to freenet AG solutions freenet’s DSL access business was subscale in a consolidating DSL access market, characterised May 26, 2009 by slowing growth and tough competitiion Deal rationale United Internet expected to migrate at least c. 700K high-value broadband customers by year end $172,000,000 2009 to its own infrastructure, becoming the number 2 DSL provider in the German market measured by the number of customers United Internet will also enter into a preferred distribution agreement with freenet, which runs until the end of 2014. United Internet will pay an additional premium in shares, valued at announcement at up to c. €49m, depending on the sales success of this distribution agreement (DSL division) The disposal of the DSL access business marks the continuation of freenet’s strategy to concentrate has been acquired by on mobile and mobile Internet, which freenet embarked on having acquired debitel in July 2008 Arma Partners has a longstanding relationship with freenet, having been retained as lead financial advisor on four assignments, including the transformational €1.6bn acquisition of debitel in 2008 Contribution / impact Arma structured a two stage auction process, with Stage 1 focusing on educating potential acquirers about the value and potential of the freenet DSL customer base Based on the expressions of interest received and detailed discussions with preferred bidders, Arma Arma Partners acted as exclusive financial structured transaction terms and perimeter to make the proposed transaction attractive to select advisor to freenet AG bidders and maintain competitive tension Through a carefully executed process, Arma managed to achieve an acceptable transaction for freenet AG in spite of a very difficult macroeconomic environment and a difficult DSL market in Germany 22
  • Case study: F-Secure acquires Steek Transaction highlights Acquirer profile Target profile Consideration: $42 million With more than 180 Internet Service Provider Steek SA provides software for online storage (ISP) and mobile operator partners globally, and data management solutions to fixed line Offer: All-cash including up to $3.5m in cash earn-out F-Secure Corporation (HLSE: FSC1V) has and mobile operators enabling consumers to been a pioneer of the ‘Security-as-a-Service’ store, share and manage personal digital Key metrics: c. 6–7x revenue business model in the industry content with PCs and mobile phones Engagement type: Public buy-side F-Secure is the largest and fastest growing Founded in 2002 in Bordeaux, France, Steek European publicly-listed security software services over 2.7 million active users through Sector: Online Storage and Security-as-a-Service company operator customers like SFR (France), Virgin Media (UK), TDC (Denmark), Singtel Arma role: Exclusive financial advisor to F-Secure F-Secure employs over 700 staff across 16 (Singapore) and Terra (Spain) Corporation offices globally Steek employs 50 staff F-Secure has been committed to the ISP business line and has been rapidly expanding its Software- July 13, 2009 as-a-Service business model, having publicly announced its intentions to augment its existing Deal rationale security products with value-added services to end-consumers through the ISP channel $42,000,000 F-Secure already had an existing partnership with Steek for the online back-up product; the acquisition of Steek allows F-Secure to bring this product in-house, continue sustained product investments and innovation as well as acquire some of Steek’s valuable customer relationships Steek’s leadership in online back-up complements F-Secure’s expertise in security products and can create a well-rounded and compelling offering for ISP customers and meaningfully enhance the scale of F-Secure’s ISP business line has acquired Contribution / impact Arma Partners has a long-standing relationship with F-Secure and was retained on this buy-side engagement after consistent positive contributions during strategic target search activities Arma negotiated upfront a detailed term sheet for the acquisition of Steek by F-Secure, upon which F-Secure was granted exclusivity to pursue a transaction on the agreed terms Arma Partners acted as exclusive financial advisor to F-Secure Corporation Arma participated actively in the process from coordinating due diligence to assisting in the negotiation of the deal documentation This deal represents a key landmark in F-Secure’s transition from a security software vendor into a broader value-added Software-as-a-Service provider to global ISPs spanning security and storage 23
  • Case study: Micro Focus acquires Borland Transaction highlights Acquirer profile Target profile Consideration: $113 million With over 15,000 customers and one million Founded in 1983, Borland Software Corp licensed users, Micro Focus International plc (NASDAQ: BORL) (“Borland”) is a vendor of Offer: All-cash, $1.50 per share (88% premium) (LSE: MCRO) (“Micro Focus”), a UK-based Application Lifecycle Management (“ALM”) company, provides innovative software that solutions Key metrics: 0.5x historic revenue, 1.0x historic helps companies to improve the business Borland’s solutions address the full range of maintenance revenue value of their enterprise applications ALM processes: Project & Portfolio Management, Requirements Definition & Engagement type: Public buy-side Micro Focus’s Application Modernisation Management, Application Testing / Automated solutions are employed by more than 70 of Software Quality, Model Driven Development Sector: Enterprise software the Fortune Global 100 companies and Software Change Management Arma role: Exclusive financial advisor to Micro Focus Micro Focus employs approximately 750 staff Borland employs approximately 760 staff International plc As part of Micro Focus’s strategy to acquire into logical adjacent markets, the c. US$2 billion global May 6, 2008 Application Testing / ASQ market was viewed as particularly attractive Deal rationale $113,000,000 The acquisition of Borland strongly complements Micro Focus’s acquisition of Compuware’s Testing and ASQ Business, which was announced on the same day Together, the acquisitions significantly increase Micro Focus’s addressable market and immediately provide critical mass in this growing market segment Market conditions make this a particularly attractive time for Micro Focus to expand its worldwide sales channels, blue chip customer base and product suite at reasonable valuation levels has acquired Arma Partners has a long-standing relationship with Micro Focus and has advised on two of their previous transactions and worked on the Borland transaction since discussions commenced in 2007 Contribution / impact Arma Partners played a critical role in orchestrating and efficiently managing the process simultaneously with the Compuware transaction to ensure synchronised announcement and maximum market impact Arma Partners acted as exclusive financial Post-announcement, two rival bids emerged, which Arma Partners helped Micro Focus carefully advisor to Micro Focus International plc fend off to eventually secure this strategically important asset at an attractive price (c. 1x maintenance revenue) The Borland and Compuware transactions were well received by the markets and at close of business on the day of announcement Micro Focus’s share price had increased by c. 18%, representing an increase in market value of c. $190m 24
  • Case study: Micro Focus acquires Compuware’s Testing / ASQ business Transaction highlights Acquirer profile Target profile Consideration: $80 million With over 15,000 customers and one million Compuware’s Testing and Automated licensed users, Micro Focus International plc Software Quality (“ASQ”) Business automates Offer: All-cash (LSE: MCRO) (“Micro Focus”), a UK-based quality processes within the software company, provides innovative software that development function to control, measure and Key metrics: 0.8x historic revenue helps companies to improve the business manage the delivery of results and to ensure value of their enterprise applications process consistency and continuous Engagement type: Public buy-side improvement through sophisticated workflow Micro Focus’s Application Modernisation capabilities Sector: Enterprise software solutions are employed by more than 70 of Compuware considered this business to be the Fortune Global 100 companies non-core to their business strategy going Arma role: Exclusive financial advisor to Micro Focus forward and sought to divest it International plc Micro Focus employs approximately 750 staff As part of Micro Focus’s strategy to acquire into logical adjacent markets, the c. US$2 billion global May 6, 2008 Application Testing / ASQ market was viewed as particularly attractive Deal rationale $80,000,000 These products are highly complementary to Micro Focus’s core solutions as they address a logically adjacent portion of the software development and deployment value chain The acquisition of Compuware’s Testing and ASQ Business also strongly complements Micro Focus’s acquisition of Borland, which was announced on the same day Together, the acquisitions significantly increase Micro Focus’s addressable market and immediately provide critical mass in this growing market segment has acquired the Application Testing / Automated Software Quality business of Arma Partners has a long-standing relationship with Micro Focus, having previously advised on their Contribution / impact successful acquisition of NetManage in May 2008 and Relativity Technologies in December 2008 Arma Partners’ careful and balanced negotiation was critical to secure the transaction at an attractive valuation as a number of counterparties had expressed interest in the asset Arma Partners acted as exclusive financial Arma Partners played a critical role in orchestrating and efficiently managing the process advisor to Micro Focus International plc simultaneously with the Borland transaction to ensure synchronised announcement and maximum market impact The Borland and Compuware transactions were well received by the markets and at close of business on the day of announcement Micro Focus’s share price had increased by c. 18%, representing an increase in market value of c. $190m 25
  • Case study: Snell & Wilcox acquired by LDC Transaction highlights Acquirer profile Target profile Consideration: $100 million Lloyds TSB Development Capital (“LDC”), the Founded in 1973, Snell & Wilcox Group investment arm of Lloyds Banking Group, is a (“Snell & Wilcox”) is recognised as a leader in Offer: Cash and reinvestment in shares leading private equity company in the UK mid- the design and development of infrastructure market solutions for digital media markets Key metrics: Undisclosed The company designs and builds the world's Since 1981, LDC has completed over 400 most advanced systems for video conversion, Engagement type: Private sell-side investments and has ongoing interests in over infrastructure, and production switching 60 businesses across the UK Sector: Digital Media Its products are used by thousands of LDC invests in a broad range of sectors and customers in the broadcast, postproduction, Arma role: Exclusive financial advisor to Snell & has particular experience in financial services, cable, satellite, and IPTV markets Wilcox Group healthcare, industrials, IT & software, leisure The Company has a blue chip customer base & media, retail and consumer of more than 1,000 active customers Arma Partners acted as exclusive financial advisor to Snell & Wilcox on its sale to Lloyds TSB March 6, 2009 Development Capital and subsequent £72 million merger with Pro-Bel Limited (“Pro-Bel”), an LDC portfolio company Deal rationale $100,000,000 (merged) As part of the transaction, Advent Venture Partners, the majority shareholder in Snell & Wilcox, reinvested in the merged company alongside LDC. Financing for the transaction was provided by The Royal Bank of Scotland and HSBC The merger of Snell & Wilcox and Pro-Bel will create one of the market leaders in the global broadcast equipment sector – a market estimated to be worth over $25 billion. The enlarged has been acquired by business will have a combined turnover of approximately £80 million, employ 450 people and service over 2,000 customers globally Snell & Wilcox had received inbound expressions of interest due to its unique technology and & subsequently merged with Contribution / impact product capabilities Arma Partners was engaged to manage a sell-side process for Snell & Wilcox which involved a number of strategic and financial buyers in both the US and Europe over the length of the process Arma Partners worked closely with the Snell & Wilcox team to clearly articulate the key value drivers Arma Partners acted as exclusive financial for the business and explain its unique market position advisor to Snell & Wilcox Group Arma was able to drive this competitive process to completion, despite the backdrop of a rapidly deteriorating economic environment, highly volatile equity markets and a depressed M&A market The transaction involved the raising of bank financing during one of the most difficult leverage environments that we have ever experienced 26
  • Case study: Danet Group acquired by Devoteam Transaction highlights Acquirer profile Target profile Consideration: undisclosed Devoteam is a Paris headquartered IT Danet is a leading independent IT consulting consulting group with has 4,250 employees and service company with 400 employees and Offer: All-cash and 2008 turnover in excess of €450m 2008 turnover in excess of €45m Key metrics: Undisclosed Operates in 20 countries across Europe, Leading player in the German market with North Africa and the Middle East European offices in UK and Austria Engagement type: Private sell-side 19 years experience in IT consulting and 25 years experience in IT service Sector: IT Services service management, on-demand services and complex technology applications Arma role: Exclusive financial advisor to Danet Group Serves customers in finance, industrials, the public sector, services, telecoms and media Serves customers in finance, logistics, pubic sector and telecommunications January 19, 2009 Danet had achieved continued success in the domestic telecommunications space , and needed a Deal rationale scale partner to pursue the high value contracts it was in line to bid for and win Undisclosed Devoteam was at the same time looking for a partner with a similar vision and team culture in order to complete the build out of its European technology services footprint Danet’s strong German sales and marketing channels will be a good addition to Devoteam’s worldwide services network, enabling both companies to achieve broader and deeper penetration of the European telecommunications and public sector markets in particular has been acquired by Arma Partners ran a full process, contacting European, Indian and US strategic partners as well as private equity firms Contribution / impact Arma Partners worked intimately with management in order to fully understand the business and carefully accentuate the strengths of the valuation story against the backdrop of an increasingly challenging economic outlook Arma Partners acted as the exclusive Arma Partners ran a strategic valuation defence that resulted in an optimal exit valuation placing financial advisor to Danet Group Danet at a premium of 70% to its trading comparable market value As a result of the transaction, Danet found a strong platform to leverage its expertise across Europe in addition to having the scale to tackle the volume of opportunities within its reach 27
  • Case study: Wayfinder Systems acquired by Vodafone Transaction highlights Acquirer profile Target profile Consideration: $30 million Vodafone (LSE: VOD) is a major provider of Provider of mapping, navigation and location- voice and data communication services to based services for connected mobile devices Offer: All-cash, SEK 12 per share (253% premium to consumers and enterprise customers globally in Europe and North America previous close) Wayfinder provides content services such as As of 31st December 2008, the Group had 289 digital city guides, traffic information, weather Key metrics: 2.4x LTM service revenue million customers. The company recorded forecast, etc. revenue of £35.5bn in 2008 Engagement type: Public sell-side Wayfinder had developed both an LBS The group has global operations spanning platform and LBS applications Sector: Mobility software Europe, the Middle East, Africa, Asia Pacific, Wayfinder reported revenues of c. €12.2m in the US, and the UK. It is headquartered in 2007 (2006: €3.1m). The company employs c. Arma role: Exclusive financial advisor to Wayfinder Berkshire, UK and employs 72,000 people 105 people Systems AB Vodafone’s new Internet Services Group believes LBS services will generate significant additional December 9, 2008 data ARPU, to offset declining voice ARPU. In addition, LBS-based social networking services will reduce churn among the subscriber base Deal rationale $30,000,000 Vodafone will use Wayfinder to create new proprietary LBS services for global deployment to Vodafone operating companies Wayfinder was Vodafone’s preferred acquisition candidate for its scalable and fully integrated platform and applications Over time applications and services developed in-house will replace third-party solutions has been acquired by Arma Partners was engaged to manage a sell-side process for publicly listed Wayfinder Systems. Contribution / impact There were no information leaks over the five month process Arma Partners helped to successfully maximise shareholder value with an exit value of 2.4x LTM service revenue. During the sale process the NASDAQ index dropped 30% Arma Partners acted as exclusive financial advisor to Wayfinder Systems AB The SEK 12.00 offer price represented a 253% premium over Wayfinder’s closing share price of SEK 3.40 as of 8 December 2008, the last trading day prior to the announcement of the offer. This was the highest premium announced in the European technology sector in 2008 28
  • Case study: Micro Focus acquires Relativity Transaction highlights Acquirer profile Target profile Consideration: Undisclosed With over 15,000 customers and one million Relativity Technologies, Inc. (“Relativity”) is a licensed users, Micro Focus International plc leader in Application Modernisation and Offer: All-cash (LSE: MCRO) (“Micro Focus”), a UK-based Application Portfolio Management software company, provides innovative software that With over 400 customers, Relativity’s Key metrics: Undisclosed helps companies to improve the business solutions increase the business value of value of their enterprise applications existing applications for customers in a host of Engagement type: Public buy-side sectors including financial services, health Micro Focus’s Application Modernisation care, insurance and the public sector Sector: Enterprise software solutions are employed by more than 70 of the Fortune Global 100 companies Founded in 1997, Relativity is based in Arma role: Exclusive financial advisor to Micro Focus Raleigh, NC and employs approximately 90 Intl. plc Micro Focus employs approximately 600 staff staff December 8, 2008 Relativity represents Micro Focus’s fifth acquisition since 2006 and builds on the NetManage (NASDAQ:NETM) and Hal Knowledge Solutions acquisitions, thereby enhancing Micro Focus’s Deal rationale leading position in the highly fragmented Application Modernisation market Undisclosed The transaction further strengthens Micro Focus’s presence in the US market while at the same time leverages Micro Focus’ extensive global sales platform to generate additional sales of Relativity products The Board of Micro Focus believes that the acquisition will be earnings enhancing in the fiscal year ending 30 April 2009 has acquired Arma Partners has a long-standing relationship with Micro Focus, having previously advised on their successful acquisition of NetManage in May 2008 Contribution / impact Relativity had been on Micro Focus’s radar screen for some time, however Arma’s insightful guidance on deal timing saved Micro Focus several million dollars in consideration by fully capitalizing on the depressed pricing environment Arma Partners acted as financial advisor to As a result, Micro Focus acquired a high quality team, industry leading products and a strong Micro Focus International plc customer base (particularly in the financial services vertical) at a very attractive valuation Industry observers have yet again applauded Micro Focus’s “smart” acquisition strategy, management execution and success, which are reflected in Micro Focus’s stock price – rising 24% in the last 6 months compared to the 15% decrease in the FTSE TechMARK All-Share index during the same period 29
  • Case study: SPI Lasers acquired by TRUMPF Transaction highlights Acquirer profile Target profile Consideration: $50 million Leading provider of production technology Leading designer and manufacturer of optical offering high-quality laser-based products and fiber-based lasers for use in materials Offer: All-cash solutions for materials processing applications processing applications Key metrics: 2.1x historic revenue Operates three business divisions: Machine Headquartered in Southampton, UK, SPI tools / Power tools, Laser Technology / Lasers was admitted to trading on AIM on 26 Engagement type: Public sell-side Electronics and Medical Technology October 2005 Sector: Optics Family owned company with more than 50 For the financial year ended 31 December subsidiaries in over 26 countries worldwide 2007, SPI Lasers reported revenues of c. Arma role: Rule 3 advisor to SPI Lasers plc £13.0m (2006: £7.1m) For the year ended 30 June 2008, TRUMPF reported group revenue of €2.14bn Employs c. 170 people TRUMPF intends to accelerate the growth of SPI Lasers, which will become a base for further September 9, 2008 development of its business in the field of fiber lasers Deal rationale The broad product portfolio of SPI Lasers in the fiber laser segment complements TRUMPF’s $50,000,000 existing product and technology platforms and creates a stronger combined industrial laser offering SPI Lasers’ strong existing sales and marketing channels will be a good addition to TRUMPF’s worldwide distribution network, enabling both companies to achieve broader and deeper penetration of industrial laser markets The offer price represented a premium of c. 33% to the SPI closing price on the day prior to the announcement, and a premium of c. 29% to the average closing price for the six month period prior to the announcement has been acquired by Arma Partners was engaged to manage a sell-side process for the publicly listed SPI Lasers. There were no information leaks or substantial share price movements over a more than 6 month process Contribution / impact Arma Partners organised a comprehensive due diligence process to address buyer concerns arising from the Company’s well-publicised operational and financial difficulties in the prior year. The final valuation was based on the Company’s strong technology and long term vision rather than past Arma Partners acted as Rule 3 advisor to performance issues SPI Lasers plc Arma Partners worked with the board and management in amending the terms of management’s exit incentive scheme so as to deliver greater value to management for their exceptional contribution to the success of the transaction Arma Partners helped to successfully maximise shareholder value with an exit value of 2.1x trailing revenue. Shareholders fully supported the Offer, with 98.5% acceptances at the first closing date 30
  • Case study: Anite Public Sector acquired by Northgate Transaction highlights Acquirer profile Target profile Consideration: $108 million Northgate Information Solutions (wholly Anite’s Public Sector business comprises two owned by Kohlberg Kravis Roberts & separate divisions: local government and SIS Co) provides specialist software, outsourcing The local government unit is a market leader Offer: All-cash and information technology services to the in providing solutions to certain areas of the local government and public safety markets UK local government, such as document Engagement type: Public sell-side (divisional sale) Northgate has approximately 4,500 large / management and social care. Its customer medium customers and approximately 10,500 base includes 70% of UK local authorities Sector: Public sector IT software and services small / medium enterprise customers The SIS unit is a supplier of secure worldwide information solutions to the police, home Headquartered in the UK, Northgate employs affairs, criminal justice and defence markets in Arma role: Exclusive financial advisor to Anite plc the UK over 6,000 staff and operates in 46 countries across 5 continents Anite Public Sector employs around 610 staff The sale of Anite Public Sector marks another phase in Anite’s transformation to become the leading August 1, 2008 supplier of industry specific IT solutions in the wireless and travel sectors The disposal will provide liquidity to help fund some of the growth opportunities that Anite plc Deal rationale $108,000,000 currently sees in its core markets The deal is part of KKR’s roll-up strategy, aimed at positioning Northgate as the leading solutions provider to the UK public sector market The acquisition enables Northgate to deliver enhanced services to its local government clients and become the undisputed leading solutions provider in the revenue and benefits, housing, social care and document management markets has been acquired by Arma Partners has a long-standing relationship with Anite plc; the disposal of Anite Public Sector is the fourth transaction on which Arma has acted as its exclusive financial advisor Contribution / impact Arma Partners’ ran a full process, contacting European and US strategic partners as well as private equity firms Arma Partners acted as exclusive financial Arma Partners spent time with the management teams of both divisions in order to fully understand advisor to Anite plc the business and carefully position each division against a backdrop of a checkered past Despite the difficult market conditions, Arma Partners helped to maximise the value of the business, with proceeds to Anite being significantly above a recent sum of the parts valuation of the business by one of Anite’s brokers 31
  • Case study: Micro Focus acquires NetManage Transaction highlights Acquirer profile Target profile Consideration: $73 million With over 15,000 customers and one million NetManage, Inc. (NASDAQ: NETM) licensed users, Micro Focus International plc (“NetManage”) is a software company that Offer: Acquisition of all outstanding common stock for (LSE: MCRO) (“Micro Focus”), a UK-based provides the fastest way to transform legacy $7.20 per share company, provides innovative software that applications into new Web-based business helps companies to improve the business solutions Key metrics: 1.3x historic revenue, 2.1x historic value of their enterprise applications maintenance revenue The company’s products allow customers to Engagement type: Public buy-side Micro Focus’s Application Modernisation access and leverage applications and data on solutions are employed by more than 70 of a number of platforms including IBM- Sector: Enterprise software the Fortune Global 100 companies compatible mainframe computers, SAP, Oracle, UNIX, and Microsoft-based servers Arma role: Exclusive financial advisor to Micro Focus Micro Focus employs 550 staff International plc NetManage employs 215 staff May 1, 2008 NetManage will enhance Micro Focus’s product portfolio and increase its footprint in the highly Deal rationale fragmented application modernisation market by providing additional scale for its development tools $73,000,000 business The transaction will add incremental geographical presence in the important US market while also providing a platform to drive further European adoption of NetManage’s solution offering The acquisition is also earnings enhancing due to synergies from cost rationalisation, listing and compliance costs and back office overheads has acquired Arma Partners has a long-standing relationship with Micro Focus and was retained on this buy-side Contribution / impact engagement after consistent positive contributions during strategic target search activities Arma Partners’ careful and balanced negotiation, bidding and timely responses were critical to secure the NetManage transaction at an attractive price on the back of a failed bid by Rocket Arma Partners acted as financial advisor to Software Micro Focus International plc The transaction has been widely applauded by industry observers as Micro Focus’s management has demonstrated its ability to pursue accretive acquisitions and deliver strong growth and profitability in a difficult market environment – the stock price has increased by c. 50% over six months since this acquisition 32
  • Case study: freenet AG acquires debitel Group Transaction highlights Acquirer profile Target profile Consideration: €1.63 billion With c. 11.7 million customers, freenet AG is With c. 13.2 million customers, debitel Group one of Germany’s leading telecommunications is the leading MSP in Germany and the third Offer: Issuance of 32 million new freenet shares to the groups offering customers internet access largest overall mobile provider vendor, issuance of a €132.5m vendor loan, and (broadband & narrowband), fixed and mobile assumption of debitel’s €1,135m banking facilities telephony, web hosting and portal services Together with its affiliated companies debitel Group has developed a Germany-wide Key metrics: 6.4x EV / EBITDA (pro forma historical) freenet’s mobilcom subsidiary is the #2 MSP distribution network with more than 6,000 in Germany with 5.7m subscribers and a points of sale as well as over 500 of its own Engagement type: Public buy-side broad offering of prepaid, postpaid and no shops frills mobile phone packages Sector: Mobile services provider (MSP) debitel Group is controlled by Permira freenet AG employs c. 3,800 staff managed funds Arma role: Financial advisor to freenet AG The transaction marks a significant step in the long awaited consolidation of the German telecoms April 27, 2008 market and gives freenet a leading market position from which to participate further Deal rationale The acquisition creates a German telecoms market leader with c. €5bn revenues, an adjusted €1,628,000,000 EBITDA of c. €350m, and an extensive customer base of c. 19m subscribers The transaction positions freenet as the # 3 mobile player in the German market With c. 1,015 shops post transaction, freenet becomes one the largest network-independent distributors of telecoms products in Germany, able to sell multiple brands Substantial synergies are expected to be achieved from the integration of debitel and mobilcom, leading to significant EPS accretion has acquired Arma Partners has a longstanding relationship with freenet AG and has previously advised freenet on their acquisition of Tiscali’s broadband and narrowband customers in Germany Contribution / impact Arma Partners acted as lead advisor in the M&A portion of this transaction, driving the negotiation process, due diligence and the positioning of the equity story Arma Partners acted as financial advisor to Arma Partners helped to prepare the press release, the equity analyst presentation, and the investor freenet AG Q&A, which were key considering the complex freenet shareholder structure Arma Partners was also appointed by the supervisory board of freenet AG to provide an independent fairness opinion on its acquisition of debitel Group 33
  • Case study: Cape Clear acquired by Workday Transaction highlights Acquirer profile Target profile Consideration: Undisclosed Workday was founded in 2005 by Dave Cape Clear is widely recognised as the Duffield, former PeopleSoft founder and CEO, market-leading independent Enterprise Offer: Undisclosed to deliver the next generation of on-demand Service Bus (“ESB”) vendor enterprise business solutions Key metrics: Undisclosed Since its inception in 1999 by former IONA Positioned as the on-demand alternative to Founders and executives, Cape Clear has Engagement type: Private sell-side ERP systems, Workday’s products span developed unique capabilities around multi- Human Capital Management, Financial tenanted, multi-channel “on-demand Sector: Infrastructure software / SaaS Management, Resource Management and integration” deployments Revenue Management Arma role: Exclusive financial advisor to Cape Clear Cape Clear was backed by Accel, Greylock, Software Inc. Workday employs c. 200 staff ACT Ventures and Interwest Nearly 100% of Workday deployments were enabled through Cape Clear’s ESB, making Cape February 6, 2008 Clear’s on-demand integration capabilities core to Workday’s go-forward strategy Deal rationale The acquisition enabled Workday to solve the single biggest hurdle to their growth ambitions by Undisclosed successfully addressing their customers’ integration challenges between Workday’s on-demand solutions and the existing on-premise IT ecosystem. This has acted as a key differentiator for Workday vis-à-vis other on-demand application software providers The Cape Clear product also helps Workday effectively and profitably monetize the integration spend and capture a larger share of customer spending during new on-demand deployments has been acquired by Cape Clear had received inbound expressions of interest due to its unique position as the leading independent provider of ESB technology and also an early pioneer of on-demand integration Contribution / impact technology Arma Partners was brought in to manage a focused process involving a handful of buyers with minimal disruption to the core business Arma Partners acted as exclusive financial advisor to Cape Clear Software Inc. The key challenge in the process was positioning Cape Clear’s value proposition uniquely for each of the potential buyers and maximizing valuation based on the individual strategic fit 34
  • Case study: Odyssey acquires Xeye Transaction highlights Acquirer profile Target profile Consideration: Undisclosed Leading provider of wealth and asset Xeye is a provider of advanced solutions to management software solutions to financial top wealth management institutions in the Offer: Undisclosed institutions North American market Key metrics: Undisclosed Key customers include ABN Amro, Barclays, Xeye's clients range from wealth managers, Deutsche Bank, Dresdner and UBS private banks and trusts to financial planners Engagement type: Private buy-side and broker dealers Odyssey is privately owned by management Sector: Financial software and venture capital investors Xeye's core solution, WealthManager, is an enterprise-grade, full Java Oracle SOA Arma role: Exclusive financial advisor to Odyssey The company was founded in 1995 and is platform for the front-end wealth management Financial Technologies S.A. based in Luxembourg market, with a strong position in the CRM / advisory retail brokerage arena The combination expands Odyssey wealth-asset management platform and creates a sizeable North January 23, 2008 American operation, whilst Odyssey accelerates Xeye’s entry into global markets Deal rationale The acquisition enlarges Odyssey’s CRM and advisory offer for the wealth management industry; Undisclosed Xeye’s platform complements Odyssey’s strengths in the HNWI / private banking domain Xeye’s acquisition is in-line with Odyssey’s objective of being the leading global provider of the wealth and asset management integrated front-office application desktop Xeye’s customers will also be able to take advantage of a wider range of investment management components including workflow integration and reference data management has acquired Arma Partners was engaged by the Board of Odyssey to help them identify which of three short- listed acquisition targets the company should engage with Contribution / impact In conjunction with Arma, Odyssey identified a list of detailed acquisition criteria (the “acquisition matrix”) to evaluate the attractiveness of each acquisition target Arma Partners acted as the exclusive Arma negotiated upfront a detailed term sheet for the acquisition of Xeye by Odyssey, upon which financial advisor to Odyssey Financial Odyssey was granted exclusivity to pursue a transaction on the agreed terms Technologies S.A. Arma participated actively in the process from coordinating due diligence to assisting in the negotiation of the deal documentation 35
  • Case study: GloNav acquired by NXP Semiconductors Transaction highlights Acquirer profile Target profile Consideration: $110 million NXP Semiconductors is a top 10 GloNav is a leading fabless semiconductor semiconductor company company developing GPS and other satellite Offer: All-cash including up to $25m in cash earn-out navigation technologies and products NXP was founded by Philips Electronics 50 Key metrics: Undisclosed years ago and spun off as a separate Solutions enable high quality location business in 2006. NXP is owned by a private functionality to be built into mobile phones and Engagement type: Private sell-side equity consortium including KKR, Bain portable devices, including PDAs, digital Capital, Apax, Silver Lake and AlpInvest cameras and music players Sector: Semiconductors NXP has a diverse revenue base with heavy GloNav was spun out of Ceva (NASD:CEVA) Arma role: Exclusive financial advisor to GloNav Inc focus on the consumer and wireless areas GloNav was backed by Atlantic Bridge Ventures NXP believes GPS has the opportunity to reach the penetration levels of FM Radio and Bluetooth in December 21, 2007 wireless handsets and as part of its strategy to focus on wireless connectivity it has brought the technology in-house Deal rationale $110,000,000 NXP will initially sell GloNav’s solution on a standalone basis at the 90nm node but over time will migrate the solution into a combined “connectivity chip” at the 45nm node Long term the potential exists to integrate the GloNav GPS technology into the wireless baseband GloNav’s strong IP position fits into NXP’s heritage as an IP focused company NXP’s large Tier 1 customer base significantly expands the potential market for GloNav has been acquired by Arma Partners has been active in the wireless handset market and maintains relationships with the majority of the key buyers Contribution / impact After the CSR-NordNav deal a wave of consolidation began in the GPS IC market. GloNav was approached by an IDM and at this stage Arma was brought to explore whether an attractive valuation could be achieved despite GloNav only being at “product tape-out” stage Arma Partners acted as exclusive financial advisor to GloNav Inc Together with the management team and investors Arma designed an accelerated process involving the major integrators in the space Arma was able to successfully create a competitive process which led to a strategic valuation being paid for an early stage company 36
  • Case study: Fidessa acquires LatentZero Transaction highlights Acquirer profile Target profile Consideration: $124 million Founded in 1981, royalblue group plc (LSE: Formed in 1999, LatentZero supplies front- RYB), provider of Fidessa, posted revenues of office software to the asset management Offer: All-cash £94.6m in 2006 and employs c. 850 people industry, counting 9 of the world’s largest asset management firms amongst its 75 Key metrics: 3.6x historic revenue Fidessa provides trading functionality, market clients coverage, order management and execution Engagement type: Public buy-side capabilities to buy- and sell-side communities LatentZero’s Capstone product is used by c. 4,000 portfolio managers, traders and Sector: Financial technology Headquartered in London with offices in New compliance officers who rely on Capstone to York, Tokyo, Hong Kong, Paris and Toronto, manage assets in excess of $8 trillion Arma role: Exclusive financial advisor to Fidessa Fidessa serves over 10,000 users, and is (formerly royalblue group plc) used by over 85% of global, tier-one equity With offices in London, Boston, New York and brokers around the world Paris, LatentZero employs around 170 staff The acquisition provides integration of multi-asset buy-side and sell-side trading flows on a April 16, 2007 significant scale Deal rationale With the buy-side increasingly requiring sell-side style trading tools integrated into their investment $124,000,000 and order management processes and the sell-side striving to deliver enhanced execution solutions, both Fidessa and LatentZero will be able to leverage the other’s services within their own customer base This transaction will enable LatentZero to accelerate its strategy of delivering connectivity services, market data and analytics to its customers as well as expanding its geographic reach, scale and support services has acquired Arma Partners was engaged by the Board of Fidessa to help negotiate a transaction and coordinate the due diligence process Contribution / impact A detailed term sheet was negotiated upfront which facilitated discussions later in the process Due diligence involved both internal and external parties and needed to be carefully coordinated Arma Partners acted as exclusive financial advisor to royalblue group plc 37
  • Case study: Software AG acquires webMethods Transaction highlights Acquirer profile Target profile Consideration: $546 million Software AG (Frankfurt: SOW.GR): a global webMethods (NASDAQ: WEBM): a leading leader in mission-critical software provider of business integration and Offer: All-cash, $9.15 per share (26% premium to infrastructure solutions based on open optimization software, targeting Global 2000 previous close) standards, with revenues of €483m in 2006 customers and major government agencies and a stated goal of exceeding €1bn in Key metrics: 2.0x historic revenue revenues by 2011 Founded in 1996 and listed on NASDAQ, webMethods had revenues of $209m in 2006, Engagement type: Public buy-side Listed on the Frankfurt Stock Exchange, employing over 800 staff and supporting Software AG has more than 35 years of global 1,500 customers worldwide Sector: Infrastructure software IT experience and had over 2,600 employees serving customers in 70 countries prior to this Forrester had rated webMethods’ integration- Arma role: Exclusive financial advisor to Software AG acquisition centric BPM product as a “Leader” By creating an industry-leading Service Oriented Architecture (SOA) and Business Process Management (BPM) product portfolio with unmatched depth and breadth, this sector-changing April 5, 2007 acquisition propelled the combined company into the top three integration-related software providers Deal rationale worldwide $546,000,000 The complementary nature of the product portfolio, customer base, geographic reach and vertical- specific expertise, coupled with Software AG’s aggressive growth plans, made this a truly transformational acquisition for Software AG For webMethods, this transaction provided significant scale and the backing of a large, financially stable software house, enabling them to focus on driving further market leadership in their integration-centric BPM product line by leveraging the combined sales force and system integrator/reseller relationships has acquired Arma Partners has a long-standing relationship with Software AG and was retained to run this process after positive contributions during previous strategic target search exercises Contribution / impact Through careful negotiation and bidding tactics, Arma Partners struck a fine balance to ensure that Software AG’s bid was superior to others from several interested strategic buyers, yet at the same time ensured significant EPS accretion for the combined company Arma Partners acted as exclusive financial advisor to Software AG The transaction has been widely applauded by industry observers, Software AG’s stock price rose 8% on the day of announcement (creating over $200m of immediate shareholder value), and the acquisition was described by the 451 Group as “the largest and arguably most significant deal yet across the whole SOA landscape” The deal took less than two months from engagement to announcement date 38
  • Case study: freenet.de AG acquires Tiscali Germany Transaction highlights Acquirer profile Target profile Consideration: $39 million As an Internet service provider, freenet.de AG Tiscali S.p.A (BIT: TIS) is a leading provider of (FRA: FNT) offers narrowband Internet Internet and VoIP access and telephone Offer: All-cash access, as well as broadband access. The services to German consumers and Company's B2B segment offers a range of businesses Key metrics: 0.7x historic revenue value-added services and develops communications solutions for business The company also provides Web hosting, Engagement type: Public buy-side customers. Its services include Voice over Web development and marketing services Internet Protocol (VoIP), e-commerce and Sector: Internet services hosting Tiscali has c. 380,000 active customers in Germany, of which approximately one third Arma role: Exclusive financial advisor to freenet.de Headquartered in Germany, freenet AG has are broadband customers AG nearly 4,000 employees and had revenues of €2,057m in FY2006 This acquisition reinforced freenet's position as one of the largest competitive internet access January 31, 2007 providers, particularly in DSL Deal rationale Tiscali’s large number of narrowband as well as broadband subscribers fitted well with freenet’s $39,000,000 existing customer base Tiscali did not have the scale or critical mass to continue to compete in Germany, as intensive competition took hold of the market This acquisition is inline with Tiscali’s strategy of refocusing its operations and financial resources in markets with the highest potential for value creation, notably Italy and the UK has acquired the German B2C broadband and narrowband customer contracts of Arma Partners worked closely with freenet throughout the transaction; from the identification of the opportunity, through to the closing, working through all the facets of what was a relatively complex Contribution / impact transaction Arma Partners acted as exclusive financial advisor to freenet.de AG 39
  • Case study: NordNav acquired by CSR Transaction highlights Acquirer profile Target profile Consideration: $75 million CSR (LSE: CSR) is a leading semiconductor NordNav is a European company that company develops and licenses satellite navigation Offer: All-cash including up to $35m in cash earn-out receivers for GPS for the mobile and defence CSR’s BlueCore features in over 60% of all industries Key metrics: c. 75x historic revenue qualified Bluetooth enabled products with industry leaders including Apple, Dell, IBM, Solutions enable high quality location Engagement type: Private sell-side Motorola, NEC, Nokia, Panasonic, Sharp, functionality to be built into mobile phones and Sony and Toshiba portable devices, including PDAs, digital Sector: Semiconductors cameras and music players CSR is headquartered in the UK, with offices Arma role: Exclusive financial advisor to NordNav in Japan, China, India, France, Denmark, NordNav’s software defined radio technology Technologies Sweden and the US runs on a host processor and enables industry leaders TTFF and sensitivity The acquisition will allow CSR to provide a software-based high performance Global Positioning January 12, 2007 System suitable for mass-market mobile handsets, Personal Navigation Devices, PCs and other portable devices for an incremental price that falls to less than $1 of the overall bill of materials when Deal rationale used with CSR’s Bluetooth $75,000,000 CSR can leverage its strong Bluetooth customer base to bring the NordNav solution to a wide community of customers GPS functionality will help distinguish CSR’s combined connectivity offering in a very competitive market As well as bringing a significant new product offering, the acquisition will provide CSR with additional research and development engineering talent has been acquired by NordNav was only at the stage of R&D revenue, but in a very attractive market Contribution / impact Arma Partners worked with the team to emphasise the synergies NordNav could bring to CSR which would justify a “strategic price” Arma Partners was able to focus efforts on an accelerated process that led to the deal closing less Arma Partners acted as exclusive financial than 4 months after the engagement began advisor to NordNav Technologies AB 40
  • Case study: Nemo acquired by Anite Transaction highlights Acquirer profile Target profile Consideration: $124 million Anite (LSE: AIE) is an international IT Nemo Technologies is the Network Test company which provides software, systems business of Helsinki-listed Elektrobit (HEL: Offer: All-cash, including up to $15m in earnout integration, consultancy and managed EBG1V) services to the travel, telecoms, finance and Key metrics: 4.3x historic revenue public sector markets Nemo develops, produces and sells software- based testing and monitoring solutions for the Engagement type: Public sell-side (divisional sale) The company offers complete services measurement and analysis of the quality of air including implementation, systems integration, interface between mobile terminals and radio Sector: Telecom software maintenance and managed services access infrastructure Arma role: Exclusive financial advisor to Elektrobit Headquartered in the UK, the Group employs Nemo employs 61 people in Finland, USA and Group plc around 1,300 staff in ten countries across Asia Europe, America, and Asia Pacific The disposal of Nemo enables Elektrobit to focus on its core activities of R&D services for the November 3, 2006 automotive and smartphone markets Deal rationale The acquisition of Nemo will strengthen Anite's position in the wireless testing solutions sector, $124,000,000 helping the company to expand its geographical coverage, increase customer penetration and out its telecoms testing offerings at the core of its business The acquisition is expected to be accretive to Anite during its first full year of ownership (FY2008) a business unit of Arma Partners was engaged by Elektrobit to dispose of its Nemo Technology division and ran a has been acquired by restricted auction amongst likely industrial and private equity buyers Contribution / impact Arma Partners introduced Anite to Nemo as part of this process Arma helped to maximise value for the business with an exit multiple of 4.3x historic revenue – the Arma Partners acted as exclusive financial highest exit multiple ever in the sector advisor to Electrobit Group plc The share prices of both Elektrobit and Anite rose on announcement 41
  • Case study: IGEFI’s recapitalisation by Summit Partners Transaction highlights Acquirer profile Target profile Consideration: Undisclosed Summit Partners is a private equity and Founded in 1995, IGEFI is one of the world’s venture capital firm with offices in Boston, leading software providers in the investment Offer: Undisclosed Palo Alto, and London funds industry Key metrics: Undisclosed Formed in 1984, the firm has raised nearly $9 Built on the latest technology, IGEFI’s billion in capital in its private equity, venture industry-leading products, MultiFonds Fund Engagement type: Private sell-side (partial recap) capital, and subordinated debt funds Accounting and Transfer Agent, boast unparalleled functionality and scalability Sector: Financial technology Summit has provided financing to more than 280 companies, which have completed more Headquartered in Luxembourg, the company Arma role: Exclusive financial advisor to IGEFI S.à.r.l than 100 public offerings, and in excess of today supports a blue-chip client base from its 100 strategic mergers or sales 20 global offices and employs more than 140 professionals worldwide The transaction is part of Summit Partners' strategy to invest in growing, profitable software June 9, 2006 companies with a strong market position Deal rationale The investment completes a partial recapitalisation that will position the company for the next stage Undisclosed in its growth, further improve its service to customers, and help execute its global expansion strategy recapitalisation with equity investment by Arma Partners was engaged by the shareholders of IGEFI to evaluate the company's strategic options Contribution / impact Arma Partners worked closely with the shareholders to define a list of investment criteria and agree on the optimal transaction structure to maximise value using both debt and equity financings Arma Partners acted as exclusive financial A highly focused approach, emphasising both the tangible and non-tangible aspects of the advisor to IGEFI S.à.r.l transaction, was put in place enabling shareholders to evaluate their alternatives All of the key points of the transaction were negotiated up-front in a detailed term sheet following a series of meetings with management 42
  • Case study: Kreatel acquired by Motorola Transaction highlights Acquirer profile Target profile Consideration: $106 million Motorola (NASDAQ: MOT) is a Fortune 100 Kreatel Communications AB is a leading global communications leader that provides developer of innovative Internet Protocol Offer: All-cash mobility products and solutions across (IPTV) based digital set-tops, headquartered broadband, embedded systems and wireless in Linkoping, Sweden Key metrics: Undisclosed networks Kreatel's Linux-based solution extends into Engagement type: Private sell-side Operating through the three primary business the application and middleware layers, units of Enterprise Mobility Solutions, Home & allowing it to be used with a broad set of Sector: IPTV Technology Networks Mobility and Mobile Devices, middleware solutions Motorola achieved sales of $35.2bn in 2005 Arma role: Exclusive financial advisor to Kreatel Customer base includes such major service Communications AB Offices in America, Asia, Middle East, Africa providers as Telefonica, TeliaSonera, and and Europe and 66,000 employees KPN Combining Motorola and Kreatel's strengths is attractive to green field video networks around the January 17, 2006 world and provides a critical solution as service providers evolve their video networks in the future Deal rationale Kreatel brings in-depth experience developing and delivering IPTV set-top software and hardware $106,000,000 solutions to European telecom operators and ISPs. Through Kreatel, Motorola gains immediate European Telco TV presence and traction with a number of large European customers who have previously deployed Kreatel’s set-tops has been acquired by Arma Partners began advising the board and shareholders of Kreatel (mainly venture capital and private equity investors), on long term value options in 2004 Contribution / impact Once Kreatel achieved significant momentum with key European telecoms customers, Arma Partners advised that the time was right to explore strategic options Arma Partners acted as exclusive financial Arma Partners took the company to meet key US “aggregators” in the sector, in the fall of 2005 and advisor to Kreatel Communications AB orchestrated the successful sale to Motorola, following interest expressed by a number of parties 43
  • Case study: Inca acquired by Dainippon Screen Transaction highlights Acquirer profile Target profile Consideration: $55 million Dainippon Screen is a Japanese provider of Inca Digital Printers is a UK-based specialist semiconductor and component manufacturing wide-format digital inkjet printer manufacturer, Offer: All-cash equipment with partners including Fujifilm Sericol and Sun Chemical Key metrics: The company manufactures graphic arts equipment and offers services such as A pioneer in its field, Inca launched ‘Columbia Engagement type: Private sell-side software development and research, Turbo’ in 2004 – the world’s fastest production development and sale of laser-related flatbed inkjet machine Sector: Printing technology equipment Formed in 2000 out of a spin-off of Cambridge Arma role: Exclusive financial advisor to Inca Digital Founded in 1943, Dainippon Screen has near Consultants, Inca employs 160 people and Printers Ltd to 5,000 employees with operations across has offices in the UK and US Europe, North America and Asia The acquisition expands Dainippon Screen's digital printing business and provides access to new June 02, 2005 markets in industrial printing and packaging Deal rationale Inca's technology complements Dainippon Screen’s existing digital imaging and printing products $55,000,000 Combining Inca's expertise in wide format inkjet printing with Screen's experience in media technology, semiconductor and flat-panel display industries will further strengthen and grow both Inca and Dainippon Screen's businesses has been acquired by Arma Partners’ sector knowledge enabled us to position the company to maximise value (as a Contribution / impact technology solutions provider rather than a hardware company) We provided support to the management team throughout the process and, in particular, we worked with management to build a financial model that could be shared with interested parties and coordinated a due diligence process involving multiple parties and advisors Arma Partners acted as the exclusive financial advisor to Inca Digital Printers Ltd Despite a limited buyer universe and complicated partnership arrangements, Arma Partners was able to create and retain competitive tension throughout the process. At the end, we orchestrated a contract race which led to an increased bid and more attractive terms for Inca’s shareholders 44
  • Case study: Cirpack acquired by Thomson Transaction highlights Acquirer profile Target profile Consideration: Undisclosed Thomson SA provides a range of video Cirpack addresses the voice management technologies, systems, finished products and market. With a wide European customer base Offer: All-cash services to customers in the media and of over 45 telecom operators and Internet entertainment industries Service Providers (ISPs), the company has Key metrics: Undisclosed secured the largest share of the European The company has three core businesses; softswitch market Engagement type: Private sell-side Systems, Services and Technology Created in 1998, Cirpack, a private company Sector: Telecom software Listed on the Paris and New York Stock based near Paris, employs approximately 60 Exchange, Thomson operates in 30 countries people and more than doubled its revenues Arma role: Exclusive financial advisor to Cirpack and is actively growing markets in North between 2003 and 2004 S.A.S America, Europe and Asia The acquisition will complement Thomson's existing offering in IP telephony, remote management April 21, 2005 and access products and gateways for triple play services and will create synergies in terms of customer base, particularly with ISPs and Tier-1 European telecom operators and with telecom Deal rationale operators in North America and Asia Undisclosed Upon acquisition Cirpack will form part of Thomson's Access Platforms & Gateways Business Unit within its Systems & Equipment Division The deal follows Thomson’s acquisition of voice and data solution provider, Inventel in March 2005 has been acquired by Arma Partners was engaged to run a sell-side process for the company Contribution / impact Positioning the company’s technology and growth potential was key to this successful exit Arma Partners’ strong European presence allowed it to advise on this domestic French transaction, in a sector traditionally dominated by US aggregators Arma Partners acted as exclusive financial advisor to Cirpack S.A.S 45
  • Case study: SESA acquired by TietoEnator Transaction highlights Acquirer profile Target profile Consideration: $94 million The Company is engaged primarily in the S.E.S.A. focuses on R&D services for telecom provision of consulting, development and system vendors, similar to TietoEnator’s Offer: All-cash hosting services for e-business telecom R&D operation Key metrics: 1.1x historic revenue Listed on the Helsinki and Stockholm Stock More than 70% of net sales come from the Exchange and Stockholsbörsen, TietoEnator telecom industry, where the main customers Engagement type: Private sell-side has close to 16,000 employees and is are Siemens, Alcatel, Nortel, Nokia, operational internationally, with activities in Vodafone, Deutsche Telekom and Telecom Sector: IT Services more than 30 countries Italia Arma role: Exclusive financial advisor to S.E.S.A. AG Founded in 1990 and headquartered near Frankfurt, the company has approximately 500 employees across Germany The acquisition allowed TietoEnator to pursue two of its strategic goals, which were to increase its December 20, 2004 presence in Germany and further strengthen its leading role in European telecom R&D services Deal rationale S.E.S.A. AG provides a strong customer base, including Siemens and Alcatel, and allows $94,000,000 TietoEnator to complement its existing close relationships with Ericsson and Nokia with a strong central European presence, especially in Germany S.E.S.A. also owns Axiome Technologies S.A. (France) with 120 employees near Paris and 49% of S.E.S.A. SpA in Italy with 80 employees S.E.S.A. was owned by funds managed by General Atlantic Partners L.L.C, management and other private investors has been acquired by Arma Partners was engaged to advise S.E.S.A on its strategic options for building on its success in the context of rapid change in the telecoms R&D services market. Globalisation of services delivery Contribution / impact and increasing penetration of standard-solution-based services present both challenges and opportunities for the whole sector Arma Partners helped the company and its shareholders to analyse, negotiate and compare Arma Partners acted as the exclusive alternative strategic options. The company and its shareholders chose to pursue the option of a financial advisor to S.E.S.A AG transaction with TietoEnator, which strengthened S.E.S.A.’s strategic base with its customers while also providing liquidity to shareholders Arma Partners initiated discussions with TietoEnator and introduced the parties, and then managed the process to signing in less than three months 46
  • Case study: Ubitrade acquired by GL Trade Transaction highlights Acquirer profile Target profile Consideration: Undisclosed GL Trade (Bourse de Paris: GLTD.LN) Ubitrade SA is a privately held company, provides electronic financial trading software leader in electronic trading and back office Offer: All cash for exchange connectivity, real-time multi- solutions for derivatives instruments market trading, and office tools for trading Key metrics: Undisclosed professionals worldwide Ubitrade services approximately 100 clients and employs 140 people based in Paris, Engagement type: Private sell-side The company has over 1,000 staff located in London, Frankfurt, Chicago and Sydney, with 26 offices on five continents serving over a development centre in Tunisia Sector: Financial software 3,500 clients including 500 major international financial institutions The company’s core products are Ubix and Arma role: Exclusive financial advisor to Ubitrade SA Tradix. It also has a distribution agreement Founded in 1987, GL Trade experienced with Fermat, a French risk management turnover of €185m in their last fiscal year company This acquisition allows GL Trade to become the first market player to offer a fully integrated front to December 2, 2004 back office solution for the derivatives market; the full integration of the Ubitrade product range Ubix, Tradix and the distribution agreement with Fermat, will complete GL Trade’s front to back multi- Deal rationale instrument solution and increase its risk management expertise Undisclosed In addition, the acquisition strengthens GL Trade’s geographic reach, particularly in Germany and the US, provides GL Trade with an offshore R&D platform based in Tunisia and enhances its management team Ubitrade will gain a worldwide sales network which should accelerate the company’s growth has been acquired by Arma Partners worked closely with Unitrade in preparing for an exit following approaches that had been received Contribution / impact Arma Partners helped the Company and its shareholders analyse its strategic options, negotiate an all-cash deal with GL Trade and complete a transaction in a short time frame Arma Partners acted as the exclusive financial advisor to Ubitrade SA 47
  • Case study: Mosaic Software acquired by S1 Transaction highlights Acquirer profile Target profile Consideration: $52 million S1 Corporation (NASDAQ: SONE) provides Mosaic is a fast growing provider of electronic Web-based front-office management and funds transfer and financial services Offer: All-cash operations software to financial services transaction processing software customers such as Bank of America, Key metrics: 2.6x historic revenue Scotiabank and KBC The company has a staff of 190, including more than 100 software developers, in offices Engagement type: Private sell-side S1 operates 29 offices in 15 countries, with in the US, UK and Australia approximately 1,300 employees worldwide Sector: Financial software Arma role: Exclusive financial advisor to Mosaic Software Holdings Ltd The transaction builds on S1’s existing product portfolio with the addition of a leading financial November 8, 2004 transaction solution and an ATM channel for its existing customer base. Mosaic provides cross selling opportunities to a customer base of approximately 210 financial institutions and retailers in Deal rationale more than 40 countries, including Honda Federal Credit Union, Standard Bank South Africa, $52,000,000 Mercantile Bank Limited, 7-Eleven and Marks and Spencer The transaction also gives S1 increased international presence, an enhanced customer base and enables the further development of its enterprise strategy With the acquisition of Mosaic, S1 is the only vendor in the financial services space that can enable institutions to extend multi-channel integration across all of their primary customer interaction channels has been acquired by Arma Partners helped to successfully maximize value for Mosaic’s shareholders with an exit value of up to 2.6x historic revenue (based on published industry analyst expectations for CY2003 revenue) Contribution / impact This valuation represents the highest recent exit multiple in the sector and a premium to the relevant trading multiples of the most comparable publicly traded companies Arma Partners acted as the exclusive Arma Partners also helped to increase the certainty of proceeds for Mosaic’s shareholders through financial advisor to Mosaic Software the negotiation of a short earn-out period (c. six months from the closing of the transaction) Holdings Ltd 48
  • Case study: Dione acquired by Lipman Transaction highlights Acquirer profile Target profile Consideration: $112 million Lipman Electronic Engineering (NASDAQ: Dione is a supplier of smart card-based LPMA) design, develop and manufacture payment systems with applications and Offer: All cash technologically advanced solutions for the managed services that help merchants electronic payment industry improve margins and customer satisfaction Key metrics: Undisclosed Customers include card issuing banks, credit Dione is one of the main suppliers in the smart Engagement type: Private sell-side card companies, credit and debit card card-based payment system market in the UK, processors, clearing houses, loyalty card and one of the top ten global providers of Sector: Payment technology operators, e-commerce companies, and electronic solutions worldwide independent sales organisations Arma role: Exclusive financial advisor to Dione Plc Headquartered in Israel, Lipman maintains eight offices globally The transaction is an important step in the consolidation of the payment systems market, and October 4, 2004 demonstrates the importance to key vendors of next-generation chip and pin payment technology Deal rationale Lipman is able to gain immediate entry into markets and geographies where it has historically not $112,000,000 been strong, particularly providing new customer relationships and adding critical mass to their UK presence As a Lipman company, Dione is able to draw upon even greater geographical support for its global customers, an increased range of products and services, additional manufacturing resources and improved economies of scale has been acquired by Arma Partners was able to successfully create a competitive process, which resulted in a significant increase in shareholder value compared to the initial proposal received Contribution / impact The transaction was structured on a cash and debt-free basis, thereby maximising proceeds to Dione shareholders Arma Partners acted as the exclusive financial advisor to Dione Plc 49
  • Case study: NXN Software acquired by Avid Transaction highlights Acquirer profile Target profile Consideration: $44 million Avid Technology (NASDAQ: AVID) provides NXN Software is the world’s leading provider digital nonlinear media creation, management of digital asset management systems for the Offer: All-cash and distribution solutions for film, video, audio, entertainment and 3D-computer-graphics animation, games, and broadcast news industries Key metrics: c. 6x revenue professionals The company's products protect and manage Engagement type: Private sell-side Avid also provides digital audio workstations, digital assets in professional computer- mixers, software, and a number of other graphics projects across industries. This Sector: Digital media software products for the music market includes digital production management, which combines digital asset management Arma role: Exclusive financial advisor to NXN The company has nearly 3,000 employees and project management, and offers Software AG productivity, workflow, and time-to-market improvements NXN’s market leading products – NXN alienbrain VFX, NXN alienbrain Studio, and NXN alienbrain January 26, 2004 Engineer – extend Avid’s current media asset management offerings with capabilities including infrastructure, configuration, project, and workflow management, as well as complete version control Deal rationale $44,000,000 The acquisition is an important step for Avid to broaden its video editing offering and further gain access to customers such as Lucas Arts, Pixar and Sony Animation The acquisition expands Avid’s leadership in digital asset management by enabling the company’s film and video postproduction, broadcast, and 3D animation customers to leverage the revolutionary workflow capabilities of the acclaimed NXN® alienbrain product line has been acquired by Arma Partners was engaged to run a sell-side process for the company Contribution / impact Through careful positioning of the business, Arma Partners achieved a valuation that reflected the strong technology offering of NXN Software and the long term vision of the business rather than its past financial performance (the company had less than $10m in revenue and is loss- making) Arma Partners acted as the exclusive Arma Partners managed to increase the valuation of the business by over 40% and drove the financial advisor to NXN Software AG process from its initiation to closing in less than 3 months 50
  • Case study: Apax Partners acquires Cartesis Transaction highlights Acquirer profile Target profile Consideration: Undisclosed Apax Partners is a private equity group, Cartesis is a provider of business operating across Europe, Israel, India, US and performance management (BPM) software Offer: n/a Japan The company's solutions enable complete Key metrics: n/a Founded 30 years ago, Apax Partners' Funds financial management such as budgeting, provide equity financing to companies at all statutory consolidation, management Engagement type: Buy-side stages of development across the retail, IT, reporting and shareholding management telecommunications, healthcare, media and Sector: Financial technology financial services industries Cartesis maintains offices in Brussels, Frankfurt, London, Madrid, Paris and Tokyo Arma role: Exclusive financial advisor to Apax Since 1995, c. 65 companies owned by Apax and has over 1,300 clients including one in Partners have listed, with a collective entry market five of the Fortune Global 100 and 30% of the capitalisation of over $35 billion Financial Times European companies The transaction provides Cartesis with the financial and strategic resources to continue strong December 23, 2003 growth and exploit the increasing market opportunity Deal rationale This divestiture of Cartesis from PwC will expand market opportunity to include those companies Undisclosed audited by PwC that originally were off limits to Cartesis due to Sarbanes-Oxley rules The investment is consistent with Apax Partners’ strategy of identifying high-quality companies with leading industry positions and other investors have acquired Arma Partners worked closely with Apax’s team to conduct due diligence on the target and negotiate the terms of the deal Contribution / impact We also helped brief Apax’s co-investors, Advent, CDP Capital and Partech, when the financing of the deal was syndicated Arma Partners acted as the exclusive We leveraged our sector knowledge to proactively identify exit opportunities for Apax, including financial advisor to Apax Partners Business Objects – who subsequently acquired Cartesis, giving Apax a very attractive return on their investment 51
  • Case study: SUSE Linux AG acquired by Novell Transaction highlights Acquirer profile Target profile Consideration: $210 million Novell (NASDAQ: NOVL) provides SUSE Linux is a market leader in Linux infrastructure components that work across operating systems in Europe and the second Offer: All-cash multiple platforms and are designed to secure largest provider worldwide and connect personal computers in corporate Key metrics: c. 7x revenue networked environments Established 1992, SUSE Linux had revenues of €40m in 2002, employing 399 staff Engagement type: Private sell-side Specific offerings include identity and access worldwide management products, resource management Sector: Open source software products, Open Enterprise Server, NetWare The company has won significant accounts and Unix against incumbent OS companies and is Arma role: Exclusive financial advisor to SUSE Linux widely seen as the technology leader in Open AG Novell has over 4,500 employees in 23 offices Source OS worldwide With the acquisition of SUSE, Novell could re-invent itself to become a leading Linux company European November 4, 2003 Novell expands its open source commitment and will become the first to offer comprehensive Linux Technology Deal rationale solutions for the enterprise from the desktop to the server. Novell will be the only $1 billion software Deal of the Year $210,000,000 company with a Linux distribution 2003 In the two weeks following announcement, Novell’s market capitalization doubled has been acquired by Arma Partners created fierce competitive tension around SUSE and ran an intense Dual Track process (fund-raising and trade sale) that took less than two months from its initiation to Contribution / impact announcement The process was tailored to maximise value for SUSE shareholders. As a result, the final purchase price was in well in excess of 2x the initial proposals by interested parties, a great result considering Arma Partners acted as exclusive financial the fact that SUSE was loss-making and the M&A environment very unfavourable advisor to SUSE Linux AG This transaction is widely regarded as an industry-shaping deal which validates Open Source and helps to bring Linux deep into the enterprise In conjunction with this deal, IBM invested $50m in the form of convertible preferred stock into Novell 52
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