Deloitte M&A sector report
Software and IT services
Quarterly updates with recent M&A transactions, analyses and insights into key industry trends, covering the Nordics.
Q1 | 2022
The high level of M&A activity in the Nordicscontinued in the first quarter of 2022
The high level of M&A activity in the Nordics continued in the first quarter of 2022, recording a total of 79 transactions within software and IT services.
The number of software transactions in Q1-22 concluded at 74, up from the 62 deals recorded in Q1- 21, and the 56 deals recorded in the latest quarter of 2021.
The Nordic IT services transaction market has slowed down over the last quarters, with only 6 deals being recorded in Q1-22, the same as in Q4-21. This is significantly lower than the 19 deals that was recordedone year ago in Q1-21.
The M&A pricing levels within software has declined over the last year with a median EV/Sales multiple of~3.2x for the last twelve months as per end of Q1-22. For IT services, the pricing level is at a medianEV/EBITDA of 11.2x LTM.
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Q4 | 2021
2021 – A record breaking year of M&A activity within software and IT services in the Nordics
The high level of M&A activity in the Nordics continued in 2021, recording a record high number of total transactions within software and IT services. The level of growth however differed amongst the Nordic countries with Denmark experiencing the highest growth within software deals, whilst Sweden experienced the highest activity level within IT services.
Q3 | 2021
Another strong quarter for M&A within Software in the Nordics in Q3 .
The strong M&A market continued in the Nordics in Q3 within software. The deal volume was the highest recorded in a third quarter, with 59 deals being announced. The M&A pricing levels within software has however declined over the last quarter with a median EV/Sales multiple of ~3.4x for the last twelve months as per end of Q3, compared to ~4.4x at end of Q2. Following the Q1/Q2 correction in SaaS multiple valuations, SaaS stocks have rebounded up to ~15x NTM Sales valuations for both the Deloitte Global and Nordic SaaS index by the end of Q3, driven by continued strong quarterly results and uplift in forward estimates.
Q2 | 2021
The strong M&A market continued in the Nordics in Q2, both within software and IT services.
The strong M&A market continued in the Nordics in Q2, both within software and IT services. Within software the deal volume in a quarter reached new heights, with 70 deals being announced. The high M&A pricing levels within software also continued in Q2, albeit slightly lower than LTM as per end of Q1-21, with a median EV/Sales multiple of ~4.5x for the last twelve months as per end of Q2 compared to ~5x at end of Q1.
Q1 | 2021
The strong Nordic M&A market within software and IT services continued in Q1
The strong M&A market continued in the Nordics in Q1, particularly within the software segment, where the deal volume in a quarter reached new heights with 62 deals being announced. The Nordic IT services market also has had a strong start to 2021 with 19 M&A transaction in Q1.
February | 2021
A record breaking year for M&A in the Nordic software and IT services market
2020 was a remarkable year for M&A activity within the Nordic software and IT services sector. The market quickly rebounded from the dip in March caused by Covid-19 and software trading multiples reached an all-time high, with the highest number of deals recorded over the last 5 years. The Nordic IT services market continued to perform strongly in 2020, trading at above average multiples and with sustained high M&A deal pricing and volume.