Q3 2023

Software M&A Update

The North American Technology Software Industry Index decreased by 0.9% in Q3 and outperformed the S&P 500, which fell 3.8% over the same period.
The median EV/Revenue multiple for reported private equity deals decreased to 5.3x in YTD 2023, down from 5.6x in 2022, but increased for strategic deals to 3.7x from 3.3x in the prior year.
M&A deal volume in the Software & Tech-enabled Services sector was down 3.1% to 851 completed transactions in Q3 compared to 878 deals in Q2 and was down 29.0% from 1,198 deals in Q3 of the prior year.
As a % of total capital invested in M&A transactions in YTD 2023, PE participation increased to 56.5%, up from 54.8% in the prior year.
North America was the most active region in Q3 with 358 deals. Most notably in the North American market was Intercontinental Exchange’s $13.1 acquisition of Black Knight in September 2023.

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