Technology M&A Now – May 2020

By Generational Group

05/14/2020

"As we stand at the vanguard of our future, technology will enable and empower individuals and organizations to advance in the face of this unrivaled adversity.”

2016 marked the beginning of The 4TH Industrial Revolution. The term was coined by Klaus Schwab, Chairman of the World Economic Forum, to describe this period in which unprecedented technological innovation is fundamentally changing the way we live, work and relate to one another.

At the root of the 4th IR, is the global movement to maximize our potential through the development and deployment of innovative technologies across all industry sectors.  When conceived 4 years ago, it was largely unthinkable that the world would be crippled by a global pandemic. Yet, the core attributes of this era address the very challenges that the Coronavirus has plagued us with.

Through the provision of interactive platforms, application of digital tools, and management of infinite data volume, the accomplishment of all pursuits is within reach. As we stand at the vanguard of our future, technology will enable and empower individuals and organizations to advance in the face of unrivaled adversity.

INNOVATION AND ADVANCEMENT

US companies currently command almost 1/3 of the world’s $5 Trillion Information Technology (IT) industry. In addition to the continuing demand for technology products and services here at home, the global growth is expected to continue to outpace all other industry sectors.

Those companies that are developing, delivering, or whose business models are anchored by technological innovation, are expected, with few exceptions, to outperform in this challenging environment. 

Looking across the digital landscape, we forecast that Business Software and Services, Cyber Security, Digital Health and Managed Services are just four of the verticals that have the opportunity to outperform during and/or early after we stabilize the economy with a predictable market.

TECHNOLOGY SECTOR M&A

Drawing on our award-winning experience from leading over 147 successful technology M&A transactions, the Generational team has carefully evaluated and assembled a representative sampling of our current technology client assignments that we expect to excel in the market. To receive additional information, or to find out how we can help you develop exit strategies for your company, contact me at dfergusson@generational.com to discuss our services.

CURRENT MARKET DEALS

A Representation of Assignments

#62976 – FEDERAL GOVCON IT/CYBER SECURITY PROVIDER TO THE US INTELLIGENCE & DEFENSE AGENCIES

An Intelligence Community (IC) customer recently awarded the Company a nearly $100 Million, 5-year, prime contract to design and build a private cloud solution to serve as an on-demand marketplace platform, sharing services across the IC supporting analysts and warfighters.

The Company enables defense, national security, and federal law enforcement clients to expand, improve, and strengthen critical IT infrastructure and mission system capabilities within the Tier III – IV Enterprise IT Operations and Cyber Security domains. Their project portfolio includes the customization and delivery of optimized cloud computing, data center operations and migration, enterprise architecture, scientific research and analyses, and cyber security solutions.

Strategically positioned in the GovCon space with key IDIQ contracts, process maturity certifications, a Top-Secret facilities clearance and a >$120M contract backlog, this company can rapidly scale as a platform or augment a larger corporate division.

REVENUE $23.5M / EBITDA $3.0M                                                                               

M&A TEAM

Frank Folz, Managing Director – M&A                                                

E. ffolz@generational.com                       T. 646 643 0091

Tristan Keeffe, Vice President                                                                

E. tkeeffe@generational.com                   T. 631 624 6460

#63281 – DYNAMIC E-COMMERCE FULFILLMENT SOFTWARE/HARDWARE FIRM

Headquartered in South Carolina, the Company designs, develops, deploys and supports hardware and software solutions for order fulfillment in distribution centers as well as kitting and sequencing for manufacturing. These solutions are targeted at improving both speed and accuracy of fulfillment operations, primarily for ecommerce orders from individual consumers and for store replenishment applications.

The Company designed custom hardware and software systems that are based upon both granted and pending patents. The innovative designs and strong intellectual property position will greatly increase the Company’s ability to maintain a competitive advantage within the supply chain industry.

The Company’s core markets: industrial tools and accessories, organic fruits and vegetables, apparel/party supplies, jewelry, cosmetics, tobacco products, vitamins and supplements, salon products, and printed media. The Company is well-positioned for continued growth and success.

REVENUE $2.8M / EBITDA $1.1M

M&A TEAM

Julie Sandoval, Senior Managing Director – M&A

E. jsandoval@generational.com                        T. 678 646 6704

Alex Mironov, Vice President                                                                 

E. amironov@generational.com                        T. 678 646 6723

#62031 – SCIENTIFIC INSTRUMENTS DESIGNER & MANUFACTURER

The Company has a long-standing (64+ years) reputation for providing quality products, reliable expertise, and superior customer support. They design, build, test, and install spectrometers, monochromators, spectrographs, and optical systems for science applications at commercial, university, and federal research laboratories around the world. The in‐house design team has collectively hundreds of years’ experience and strives to provide the highest quality optical instruments consistently for all customers. These are custom designs, but more often are based on the Company’s comprehensive range of standard products. They are optical instruments and systems for measurement of light and are finished per published specifications or tweaked for specific scientific requirements.

The customer base is internationally diverse and typically long-term project-based operating in scientific research, semiconductor manufacturing and energy markets.

REVENUE $3.7M / EBITDA $515K                                                                                 

M&A TEAM

Jeff Carignan, Managing Director – M&A

E. jcarignan@generational.com                         T. 413 537 3079

Corey Painter, Vice President

E. cpainter@generational.com                          T. 972 232 1152

#62324 – DIGITAL TRANSFORMATION SPECIALIST TO THE MANUFACTURING INDUSTRY 4.0

This Company is an international, fully integrated digital transformation firm that provides leading-edge solutions to help manufacturing companies transform their operations. The Company is at the forefront of digital transformation, providing customers with a range of consulting and software solutions to improve all aspects of operational activities including design, simulation, prototype development, manufacturing, product life cycle management, and service.

These new solutions transform engineering, manufacturing, and supply chain processes dramatically while significantly increasing labor efficiencies. The Company provides solutions for Computer-Aided Design (CAD), Computer-Aided Manufacturing (CAM), Computer-Aided Engineering (CAE), Product Lifecycle Management (PLM), 3D Printing, Computational Fluid Dynamics (CFD), Finite Element Analysis (FEA), Augmented Reality (AR), and Internet of Things (IoT).

The Company benefits from strong long-term relationships with best-in-class retail/e-tail market leaders for whom they have established proven product development, sales, and replenishment programs. Over time, management has expanded the Company’s vendor relationships to include MakerBot, Hexagon (Spring Technologies), German RepRap, KeyShot, and EnvisionTEC.

REVENUE $9.9M / EBITDA $1.9M

M&A TEAM

Ahmad Behjati, Senior Vice President – M&A

E. abehjati@generational.com                           T. 203 716 1185

Tristan Keeffe, Vice President

E. tkeeffe@generational.com                            T. 631 624 6460

COMPLETED TRANSACTIONS

A representation of Technology Deals – May 2020

View more of our Technology M&A deals or email me to discuss our services and your requirements at dfergusson@generational.com.