Site Remediation and Environmental Solutions Sector M&A Transactions and Valuations

Between Q1 2020 and Q4 2024, increasing global environmental awareness and stricter regulatory frameworks drove significant growth in the site remediation and environmental solutions sector. Companies developed innovative approaches to remediation, waste management, and sustainability, advancing technologies and solutions in the process. These efforts prompted businesses to invest in mergers and acquisitions, reshaping the sector’s competitive landscape.

This report analyzes transaction trends, valuation metrics, and regional dynamics in the site remediation and environmental solutions sector. Investors and market participants used valuation multiples such as EV/revenue and EV/EBITDA to assess scalability, operational efficiency, and environmental impact. Companies executed significant transactions, including Clean Harbors’ acquisition of HEPACO, KKR and Corporación Financiera Alba’s investment in ERM International Group, and Meridiam and Global Infrastructure Partners’ buyout of Suez Environment. These deals highlight how businesses enhanced technological capabilities, expanded geographic reach, and achieved environmental sustainability goals. These deals demonstrate how strategic investments shaped market leadership and provide actionable insights for investors, stakeholders, and policymakers in this rapidly evolving field.

• Valuation multiples are based on a sample set of private and public M&A transactions in the site remediation and environmental solutions sector, using data collected on January 13, 2025.
• Larger companies with enterprise values exceeding $1 billion typically show EV/revenue multiples between 0x and 5x and EV/EBITDA multiples ranging from 2x to 30x. These reflect their predictable cash flows, mature operations, and lower risk profiles. This relationship between size and stability demonstrates how larger firms trade at more conservative valuations due to their operational steadiness and established market positions, which reduce investor risk and limit the premiums paid for growth potential.
• Smaller companies with EVs below $500 million show highly variable valuation multiples, with EV/revenue often exceeding 10x and EV/EBITDA extending beyond 100x in outlier cases. This reflects the market’s willingness to pay speculative growth-driven premiums, particularly for high-growth industries or early-stage ventures, despite the heightened uncertainty and risks associated with their less predictable performance.
• Profitability plays a crucial role in valuation, as EV/EBITDA multiples consistently exceed EV/revenue multiples, highlighting the importance of operational efficiency and cash flow potential. For instance, companies with moderate EV/revenue ratios often show significantly higher EV/EBITDA ratios when profitability is constrained, making EBITDA-based metrics a clearer indicator of performance, particularly for larger, more established firms.

Capital Markets Activities

The data highlights transaction trends, valuation metrics, and regional dynamics in the site remediation and environmental solutions sector. Advanced remediation technologies, sustainable waste management, and real-time monitoring have driven M&A activity and shaped valuations. By advancing cleanup technologies and ecological restoration, the sector promotes public health, sustainability, and economic revitalization. Investors are adopting diverse strategies to meet the growing demand for efficient environmental solutions, reshaping M&A dynamics and fostering innovation.

• Over the 20 quarters, investors put approximately $103 billion into 1,876 deals, reflecting an active market for site remediation and environmental solutions. The average capital invested per quarter is approximately $55 million, with an average of 94 deals per quarter.
• Capital invested varies widely across quarters, ranging from as low as $288 million in Q1 2021 to peaks like $16 billion in Q1 2022 and $15 billion in Q1 2024. These fluctuations likely reflect major transactions or sector trends during specific periods. Notably, the highest investment quarters coincide with moderate to high deal counts, indicating significant high-value deals or strategic shifts in investment focus during these periods.
• Deal counts remain relatively stable compared to capital investment, with quarterly figures generally ranging between 75 and 130 deals. This consistency highlights robust market engagement regardless of investment scale. The highest deal count of 130 in Q4 2021 coincides with moderate capital investment of approximately $5 billion, reflecting smaller average deal sizes that quarter compared to others with fewer but higher-value deals.

The graphs below present the geographic distribution of transactions, providing additional detail on regional trends and investment dynamics.

• US-based investors dominate the market, contributing 31% of the total capital invested. They focus on larger, high-value investments, targeting high-growth or high-stakes opportunities in established markets and sectors that require substantial financial resources. France follows with 25% of capital invested, showcasing its strong global presence and emphasis on strategic, larger-scale investments. The UK and Japan, contributing 14% and 12%, respectively, make significant yet more selective investments, prioritizing quality over volume.
• The US leads the deal-making landscape with 47% of the total deal count, actively participating in a wide range of smaller-scale investments. In contrast, countries like the United Kingdom, which contributed 11%, and Canada, which made up 7%, adopted a more conservative approach, engaging in fewer deals but focusing on higher-quality investments.
• Other markets account for 18% of capital invested and 30% of the deal count, signaling growing global diversification, particularly in emerging markets and smaller economies. While these countries contribute less capital, they account for a larger share of deal activity, indicating an increase in smaller, more frequent transactions. This trend reflects rising interest from international investors in sectors or regions with untapped growth potential.

The deal-type dynamics below set the stage for understanding how capital flows and strategic priorities shape the site remediation and environmental solutions sector growth and landscape.

• M&A transactions, totaling 1,002 deals and accounting for 53% of total activity, reflect the sector’s emphasis on consolidation, strategic partnerships, and market expansion. This trend highlights how M&A facilitates industry integration and operational scaling. The prominence of M&A underscores companies’ focus on achieving growth through synergies and improved market positioning.
• Buyout deals, comprising 874 transactions and 47% of total activity, reflect strong investor interest in value creation. This significant share highlights the sector’s appeal to private equity firms and strategic buyers seeking long-term growth opportunities. The focus on buyouts underscores a drive to take control of operations, optimize efficiencies, and enhance profitability.
• The near-equal distribution between M&A and buyout deals highlights diverse strategic priorities within the sector. While buyouts focus on restructuring and scaling businesses, mergers emphasize combining complementary capabilities. This balance reflects the sector’s dynamism, showcasing how stakeholders adopt varied strategies to capitalize on market opportunities. The diversity in deal types underscores investors’ flexibility and adaptability in navigating market conditions.

M&A Transactions Case Studies

Three key M&A transactions in the site remediation and environmental solutions sector highlight strategic growth through expanded market presence, enhanced capabilities, and strengthened service offerings. These deals focused on regional expansion, technological integration, and complementary customer segments. Investors leveraged targeted strategies to drive scalability and long-term growth, and capitalize on the rising demand for sustainable solutions. Through these acquisitions, companies reinforced their leadership in the evolving environmental services industry, driving operational efficiencies and innovative practices.

Case Study 01

HEPACO

HEPACO, headquartered in North Carolina, is a leading environmental and emergency services company specializing in cleanup and remediation. It provides emergency response, environmental remediation, maritime services, wastewater treatment, and other industrial services. HEPACO operates at multiple locations across the United States.

Transaction Structure

Clean Harbors financed its $400 million acquisition of HEPACO using proceeds from a recently completed $500 million expansion of its Term Loan facility. This financing structure allowed Clean Harbors to pay for the transaction upfront while preserving additional funds for future needs.

Market and Customer Segments Combination

The integration of HEPACO into Clean Harbors expanded the combined entity’s market reach, particularly in the Southeastern and Mid-Atlantic United States, where HEPACO has a strong presence. This combination allowed Clean Harbors to leverage HEPACO’s established customer base across industries such as manufacturing, utilities, transportation, and government. The alignment of both companies’ services strengthened their capacity to provide comprehensive solutions, including emergency response, industrial cleaning, and environmental remediation, to a diverse range of clients.

Acquisition Strategic Rationale

The acquisition aligned with Clean Harbors’ long-term strategy to strengthen its environmental services segment and enhance its field services business. By acquiring HEPACO, Clean Harbors gained significant operational expertise, regional presence, and a workforce trained in emergency response and environmental remediation. Additionally, the acquisition enabled Clean Harbors to cross-sell its broader suite of environmental and industrial services to HEPACO’s client base. The deal reflected Clean Harbors’ commitment to expanding its market share, increasing revenue streams, and maintaining leadership in the environmental services sector. This strategic move positioned Clean Harbors to capitalize on the growing demand for sustainable waste management and environmental cleanup solutions across North America.

Case Study 02

SUEZ ENVIRONMENT

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Suez Environment, a France-based subsidiary of Veolia, was a global leader in water, waste, and remediation solutions. The company specialized in water treatment, waste recovery, recycling, remediation, and environmental consulting. It actively promoted resource conservation and circular economy practices through innovative technologies.

Transaction Structure

A consortium acquired the company through a $15 billion LBO on January 31, 2022. Following the acquisition, Meridiam and GIP each held a 40% stake, while Caisse des Dépôts Group and CNP Assurances jointly held the remaining 20%.

Market and Customer Segments Combination

The acquisition enabled the newly structured Suez to cater to a wide range of markets, focusing on water and waste management services that meet the growing demand in sectors with strict environmental and regulatory requirements. This transaction expanded the combined entity’s presence in key regions and enhanced its service offerings to both public and private sector clients worldwide.

Acquisition Strategic Rationale

The acquisition advanced Veolia’s long-term strategy to optimize market share by divesting non-core assets and concentrating on its highest-growth areas. Focusing on essential environmental services, such as water and waste management, reinforced Suez’s leadership in these sectors. Additionally, the involvement of investors like Meridiam, GIP, and Caisse des Dépôts Group provided financial resources and strategic guidance, driving innovation and supporting long-term growth in the environmental services industry.

Case Study 03

ERM

ERM International Group (Environmental Resources Management), based in the UK, leads globally in environmental, health, safety, risk, remediation, and sustainability consulting. The company helps businesses tackle sustainability challenges, ensure regulatory compliance, remediate contaminated sites, and manage risks. It offers services such as ESG advisory, biodiversity solutions, and climate strategies.

Transaction Structure

KKR acquired a majority stake in ERM International Group for approximately $2 billion. The acquisition was supported by approximately $900 million in debt financing. As part of the leveraged buyout, Corporación Financiera Alba invested around $295 million, securing a 15% indirect shareholding in ERM.

Market and Customer Segments Combination

The acquisition combined ERM’s global expertise in environmental and sustainability consulting with KKR’s focus on ESG-aligned investments. ERM’s services, which catered to industries like energy, mining, and manufacturing, were complemented by KKR’s financial resources and strategic vision. Corporación Financiera Alba strengthened the transaction with its focus on sustainable, long-term investments.

Acquisition Strategic Rationale

The acquisition supported KKR’s sustainability goals by integrating ERM’s expertise in environmental consulting and remediation. It provided growth opportunities by enabling ERM to expand its service offerings and geographic presence, supported by KKR’s financial backing. The transaction also emphasized the rising importance of ESG and environmental compliance, positioning ERM to drive long-term value creation for its clients and investors.

The site remediation and environmental solutions sector is undergoing a significant transformation, driven by the need to address global environmental challenges, comply with evolving regulations, and adopt innovative technologies. M&A activity in the sector has focused on expanding technological capabilities, enhancing service offerings, and achieving greater operational efficiencies. Key transactions have highlighted the industry’s commitment to sustainability, resource conservation, and environmental stewardship.

As organizations respond to the growing demand for effective remediation and sustainability solutions, they increasingly use M&A as a critical strategy to achieve synergies, foster innovation, and expand market reach. The sector’s increasing focus on transformative solutions underscores its pivotal role in advancing environmental goals while driving economic value. Looking ahead, investors and stakeholders are set to capitalize on M&A opportunities, positioning themselves to meet emerging environmental priorities and secure competitive advantages in a rapidly evolving global market.

Source: Clean Harbors, BusinessWire, Financier, Meridiam, Veolia, Pitchbook Data.

Real Property Services Transactions and Valuations

Between Q1 2021 and Q4 2024, over $280 billion was deployed across M&A transactions within the real property services sector. This activity reflects a growing demand for companies that provide specialized property-related services, including commercial property management, single-family rental solutions, and property preservation.

Real property services companies offer a range of essential solutions aimed at maintaining and enhancing property value. These include property inspections, preservation, maintenance, and renovation services, along with various interior and exterior upkeep offerings. The sector encompasses firms that manage residential, commercial, and mixed-use properties, often integrating technology to streamline operations and improve service efficiency.

The rise in demand for property services is driven by several key trends, including the shift toward outsourcing property management, the increasing need for property preservation in aging real estate markets, and the growing emphasis on tenant satisfaction through proactive maintenance and digital engagement. Companies that can address these needs through comprehensive service offerings and scalable platforms are increasingly attractive to strategic buyers and financial investors alike.

M&A activity in the sector reflects the appeal of companies that combine traditional property management services with technology-driven solutions. Buyers are particularly interested in firms that can deliver recurring revenue models, improve operational efficiencies, and reduce tenant turnover through smart property management tools.

Valuation multiples in the real property services sector vary significantly based on the type of services offered, geographic focus, and the integration of technology into service delivery. Companies that provide comprehensive property solutions across multiple asset classes, particularly those that specialize in commercial properties, single-family rentals, and property preservation, tend to command higher valuations due to their ability to generate stable cash flows and long-term client relationships. As the sector continues to evolve, M&A activity is expected to remain strong, driven by the need for operational efficiencies, the ongoing digital transformation of property services, and the growing demand for comprehensive property management solutions.

• The valuation multiples presented are based on a sample set of real property services companies and M&A transactions within the sector. The data reflects typical enterprise value (EV) to revenue and EV to EBITDA multiples observed across both private and public transactions over the period from Q1 2021 to Q4 2024.
• The average EV/revenue multiple for real property services transactions was 7x, with a median of 6x. The range from 1x to 15x highlights that valuation depends heavily on the asset type, recurring revenue potential, and operational efficiency. Companies that integrate technology-driven management solutions tend to command higher multiples due to their ability to streamline property operations and improve tenant experiences.
• The EV/EBITDA multiple averaged 11x, with a median of 9x, spanning from 2x to 29x. Higher multiples are typically associated with companies that deliver integrated property management services through digital platforms or proprietary systems. Buyers place a premium on firms that can improve operational efficiencies and reduce tenant turnover through innovative solutions.

• Between Q1 2021 and Q4 2024, the total capital invested across real property services M&A transactions reached approximately $281.38 billion, distributed across 4,142 deals, with an average deal size of $68 million. The consistent activity reflects strong investor interest despite fluctuations in deal size and capital deployment.
• Q3 2021 saw the highest level of capital deployment, with $58.18 billion invested across 256 deals. This period highlights heightened market activity and significant investor confidence in the sector, likely driven by economic recovery following the pandemic’s initial impacts.
• Deal count peaked in Q1 2022, with 319 transactions recorded. The post-pandemic recovery created urgency for companies to secure operational synergies and expand their service offerings in response to shifting real estate trends. Additionally, investors took advantage of low financing costs and favorable valuations to close deals before anticipated interest rate hikes.
• The average deal count per quarter ranged between 203 and 319, reflecting a relatively steady flow of transactions. The consistency in deal count indicates sustained interest in real property services, driven by ongoing demand for strategic consolidation and expansion opportunities.

• The United States led in both capital invested and deal count, contributing 43% of total capital and 37% of transactions. The large capital share indicates a preference for bigger-ticket transactions, driven by investor confidence in the stability and growth potential of US-based assets. The slightly lower proportion of deal count suggests that the US market is home to higher-value transactions compared to other regions.
• Germany accounted for 16% of capital invested, making it the second-largest market by capital. However, its deal count share of 4% indicates that German transactions tend to be large and focused on industrial and commercial property portfolios. This disparity highlights a concentration on fewer, higher-value deals in the German market.
• The United Kingdom represented 13% of capital invested and 16% of deal count, indicating a more balanced distribution between transaction volume and value. This suggests that the UK market is attractive for mid-market deals, with buyers pursuing both strategic and financial acquisitions in the sector.
• Canada, Japan, and Sweden each contributed 3 – 4% of capital invested and had similar shares in deal count. Their balanced contributions indicate stable transaction activity, reflecting consistent interest in these regions, particularly in residential and commercial real estate assets.
• Smaller markets such as Spain, Canada, and Australia saw contributions of around 2 – 4% of total capital and deal count. These markets are indicative of growing investor interest in emerging opportunities outside the primary markets. Cross-border transactions in these regions reflect diversification strategies by global buyers.
• The “Other” category, which includes numerous smaller countries, accounted for 9% of the total capital invested and 20% of the deal count. This discrepancy highlights a large number of smaller deals conducted globally, particularly in less mature markets or niche sectors within real property services.

• Mergers and acquisitions (M&A) accounted for $200 billion in capital across 3,054 transactions, representing the majority of deal activity. This high volume reflects the ongoing need for strategic consolidation in the real property sector, where acquirers seek to achieve operational efficiencies and secure prime real estate assets. The significant capital allocation towards M&A highlights the value placed on long-term growth through acquisition strategies.
• Buyout/leveraged buyout (LBO) transactions contributed $81 billion across 1,088 deals, indicating a preference for more targeted, higher-value transactions within the private equity space. The relatively lower deal count compared to M&A reflects a focus on mature assets with predictable cash flows, which are attractive to private equity firms seeking to optimize their returns through financial restructuring.
• M&A deals consistently outnumber buyouts, indicating a broader interest in smaller, more frequent acquisitions across the real property services sector. This trend suggests that strategic buyers are actively pursuing opportunities to expand their portfolios and increase service offerings through bolt-on acquisitions rather than relying solely on larger, leveraged transactions.
• The significant disparity between capital invested and deal count across deal types illustrates the varied approaches by strategic acquirers and financial sponsors. While M&A transactions tend to involve a wider range of deal sizes, buyouts are more concentrated and typically involve larger, single-asset transactions driven by financial restructuring goals.

Deal Spotlight:

BUILDING ENGINES

In November 2021, JLL acquired Building Engines, a property management software company, for $300 million. The acquisition aimed to strengthen JLL’s property management capabilities by integrating advanced technology solutions that improve building operations. Building Engines specializes in delivering a comprehensive property management platform that enables commercial real estate owners to streamline operations across their portfolios. The platform includes tools for work order management, preventive maintenance, and vendor management, addressing the growing need for automation and efficiency in property services.

The transaction reflects a broader trend in the real property services sector toward digital transformation. By acquiring Building Engines, JLL sought to leverage data-driven insights to optimize property performance, reduce operating costs, and improve the overall tenant experience. This aligns with the increasing demand for technology-enabled property management solutions.

The deal also underscores the strategic importance of integrating proprietary software platforms within traditional property services, enabling service providers to offer scalable, tech-driven solutions to meet evolving client expectations.

Deal Spotlight:

FIVE BROTHERS

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In 2023, Mortgage Contracting Services (MCS), a leading provider of property preservation and inspection services, acquired Five Brothers Asset Management Solutions, expanding its footprint in property maintenance, preservation, and field services. The transaction aimed to enhance MCS’s service offerings across the REO and default management sectors by integrating Five Brothers’s expertise in foreclosure maintenance and vendor management. Five Brothers is well-known for providing comprehensive property management solutions, including property inspections, preservation services, and post-foreclosure maintenance. The company’s services cover a range of critical tasks, such as securing vacant properties, addressing code violations, and maintaining asset conditions to preserve property value for financial institutions and investors.

Although the exact amount of the transaction is not public, this acquisition reflects a broader trend of consolidation in the property services sector, driven by rising demand for cost-effective property preservation services in a growing real estate market. By acquiring a regional leader in property management services, MCS solidified its position as a national provider of default-related property services, catering to a client base that includes financial institutions, government agencies, and real estate investors.

The combined service offerings from MCS and Five Brothers allow for turnkey property management solutions, covering everything from inspections and repairs to ongoing maintenance and compliance checks. This integration strengthened MCS’s ability to support clients in mitigating risks, reducing costs, and improving asset performance in their property portfolios.

The real property services sector is evolving due to increasing demand for inspections, preservation, and maintenance services that maintain property value. M&A activity reflects the growing importance of companies offering practical, on-the-ground solutions like property inspections, repairs, and renovations. Firms that can provide consistent, recurring services to preserve property conditions and address tenant needs are becoming key targets for investors. The integration of technology to streamline workflows and improve service delivery has further increased the value proposition of property services firms, making them more attractive to acquirers.

Source: Coherent Market Insights, Fact.MR, Pitchbook Data.

Logistics and Transportation Technology M&A Transactions and Valuations

Between Q1 2020 and Q3 2024, the logistics and transportation technology sector experienced substantial growth, driven by the widespread adoption of digital transformation efforts throughout the industry. Companies increasingly automated their processes and used advanced analytics to enhance scalability and operational efficiencies, which led to increased demand for innovative logistics solutions. The need for robust, scalable logistics infrastructure prompted more investments in transportation technologies, making modernization a crucial component of business strategies.

This report examines transaction trends, valuation metrics, and regional dynamics, providing a detailed analysis of the strategic factors that drive M&A activities within the logistics and transportation technology sector. Valuation indicators such as EV/revenue and EV/EBITDA reveal investor priorities and the market conditions that shape valuations. Significant transactions, such as Uber Freight’s acquisition of Transplace, The Jordan Company’s buyout of Echo Global Logistics, and e2open’s acquisition of BluJay Solutions, demonstrate the industry’s focus on technological progress, scaling operations, and consolidating market leadership. These examples show how strategic mergers and acquisitions influence the competitive landscape and offer insights for investors, advisors, and stakeholders in this evolving market.

• Valuation multiples are based on a sample set of private and public M&A transactions in the logistics and transportation technology sector, using data collected on December 12, 2024.
• Larger companies typically achieve lower valuation multiples as their enterprise value increases, with EV/revenue and EV/EBITDA multiples clustering in the lower range 1x to 10x. This reflects their stable performance, predictable cash flows, and established market positions, which reduce investor risk and limit the premium paid for growth potential.
• Smaller companies exhibit greater variability in valuation, particularly in the lower EV range below $100 million, where multiples often disperse widely and extend upward of 10x to 100x. This reflects investor willingness to pay premiums for the higher growth potential and increased uncertainty associated with smaller, high-growth companies.
• Profitability plays a key role in driving valuation differences, as EV/EBITDA multiples consistently exceed EV/revenue multiples. This underscores the significance of profitability in valuation assessments, with EBITDA-based metrics providing a clearer measure of operational efficiency and cash flow, especially for companies with higher enterprise values.

Capital Markets Activities

The data highlights transaction trends, valuation metrics, and regional dynamics in the logistics and transportation technology sector. The adoption of digital freight platforms, cloud-based supply chain solutions, and real-time analytics has fueled M&A activity and shaped valuations. Investors are leveraging diverse deal structures and geographic strategies to meet the growing demand for scalable, efficient logistics technologies, reshaping M&A dynamics, fostering innovation, and redefining the competitive landscape.

• Investors committed $718 billion to the logistics and transportation technology sector between Q1 2020 and Q3 2024, completing 1,951 deals with an average deal size of $368 million.
• Capital investment peaked at $87 billion in Q4 2021, with 161 deals, the highest on record, reflecting strong investor confidence and strategic interest in the sector. During this period, companies capitalized on growth opportunities, scaling and innovating rapidly.
• After this peak, both capital investment and deal count moderated, with deal activity declining to 56 deals by Q3 2024. This shift signals a maturing market as investors focus on fewer, higher-quality transactions that prioritize efficiency, innovation, and long-term value creation.
• Although capital investment dipped to $15 billion in Q3 2024, recent trends demonstrate a steady adjustment to evolving economic and market conditions. This stabilization underscores a commitment to sustainable growth and strategic consolidation, directing resources toward impactful technologies and transformative companies.

The graphs below present the geographic distribution of transactions, providing additional detail on regional trends and investment dynamics.

• The United States leads the market, capturing 30% of the total deal count and 50% of capital invested. This dominance underscores the region’s strong focus on large-scale, high-value transactions and its position as a global hub for logistics and transportation technology investments.
• Germany (6% deal count, 5% capital) and the United Kingdom (8% deal count, 4% capital) exhibit moderate deal activity with smaller transaction sizes, reflecting limited capital flows in these regions. This highlights their focus on mid-market opportunities and regional investments, contributing to the sector’s overall diversity in transaction dynamics. Despite their smaller scale, these markets remain essential contributors to innovation and localized growth in the logistics and transportation technology sector.
• Regional markets outside the US accounted for 49% of the deal count and 34% of capital invested, highlighting extensive activity across smaller markets with lower transaction values. This reveals emerging opportunities in diverse regions, even as major markets like the US maintain their dominance in attracting most capital flows.

The deal-type dynamics below set the stage for understanding how capital flows and strategic priorities shape the logistics and transportation technology sector’s growth and landscape.

• Mergers and acquisitions lead the market, accounting for $460 billion in capital across 1,432 deals. This dominance shows that M&A activity drives most capital flows and deal volume, reflecting ongoing consolidation trends and strategic acquisitions across industries. Businesses use these large, transformative deals to fuel growth, expand markets, and achieve operational synergies.
• Buyouts contribute $228 billion in capital across 436 deals, demonstrating that private equity and institutional investors prioritize acquiring control stakes in companies. The higher capital per deal reflects a preference for larger transactions that maximize long-term returns. Investors confidently leverage buyouts to improve operations and unlock significant value in target companies.
• Public-to-private deals represent the smallest share, with $30 billion in capital and 83 deals. While less frequent, these transactions highlight investor interest in taking undervalued public companies private. Factors such as valuation challenges, financing costs, and market conditions likely limit their volume, but they remain a strategic option for acquiring valuable assets with the potential for private transformation.

M&A Transactions Case Studies

Three notable M&A transactions in the logistics and transportation technology sector highlight strategic growth through enhanced market leadership, advanced technological integration, and expanded operational capabilities. These deals emphasized global expansion, operational synergies, and technological innovation, redefining the competitive landscape. Investors leveraged targeted strategies to drive scalability, foster sustainable growth, and create long-term value in this rapidly evolving industry.

Case Study 01

BLUJAY SOLUTIONS

BluJay Solutions, based in the United Kingdom, is a global leader in cloud-based supply chain and logistics management software. The company offers comprehensive solutions, including freight forwarding, transportation management, and global trade compliance, enabling businesses to optimize their logistics operations and enhance supply chain efficiency.

Transaction Structure

E2open acquired BluJay Solutions in a $2 billion transaction that included 72 million shares of e2open’s Class A common stock and $760 million in cash. The cash component covered debt repayment and adjustments under the purchase agreement, with financing provided by Credit Suisse and Goldman Sachs.

Market and Customer Segments Combination

The acquisition combined BluJay’s expertise in global trade and transportation management with e2open’s end-to-end SaaS supply chain platform, creating a comprehensive solution that catered to a wide range of industries including retail, manufacturing, and logistics service providers. This integration strengthened their ability to address complex supply chain needs for global customers and enhanced cross-industry collaboration by offering a unified platform for managing supply chain, logistics, and compliance workflows.

Acquisition Strategic Rationale

The deal accelerated e2open’s growth by expanding its SaaS platform capabilities, enhancing global trade and logistics offerings, and positioning the company as a leader in supply chain management. Additionally, the acquisition drove operational synergies, increased market share, and gave BluJay’s customers access to e2open’s broader portfolio of supply chain solutions. This combination enabled the company to scale its operations globally and deliver greater value through a more comprehensive suite of services.

Case Study 02

TRANSPLACE

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Transplace, a US-based logistics technology and transportation management company, delivers comprehensive supply chain solutions. Its offerings include managed transportation, freight brokerage, and advanced logistics technology, all designed to optimize freight operations and enhance efficiency for shippers.

Transaction Structure

Uber Freight acquired Transplace for more than $2 billion, with $750 million paid in Uber stock and more than $1 billion in cash, financed through a combination of internal resources and external funding.

Market and Customer Segments Combination

The acquisition combined Uber Freight’s extensive network of digitally enabled carriers with Transplace’s shipper-focused technology and operational solutions, creating a comprehensive platform to serve both small businesses and large enterprises. By uniting these complementary networks, the deal bridged the gap between supply and demand in the logistics market, ensuring better service coverage and efficiency.

Acquisition Strategic Rationale

The deal enhanced Uber Freight’s ability to provide integrated logistics solutions, optimized its supply chain efficiencies, and strengthened its position as a leader in the freight technology market. Additionally, it accelerated Uber Freight’s growth strategy by expanding its footprint in managed transportation and enhancing its value proposition for enterprise shippers.

Case Study 03

ECHO GLOBAL LOGISTICS

Echo, a technology-driven transportation and logistics company based in the US, specializes in freight management and brokerage services. The company connects shippers with carriers, delivering optimized shipping solutions that enhance efficiency and streamline supply chain operations.

Transaction Structure

Echo Global Logistics was acquired for more than $1 billion in a public-to-private leveraged buyout led by The Jordan Company, with participation from Finback Investment Partners, Barings BDC, and Barings. Valued at more than $48 per share in cash, the transaction was supported by $810 million in debt financing, ensuring the necessary capital to complete the acquisition.

Market and Customer Segments Combination

The acquisition enhanced Echo’s ability to serve diverse customer segments, from small-to-medium-sized businesses to enterprise-level shippers, by providing tailored freight and logistics solutions. This alignment broadened market access and strengthened its position in the competitive logistics sector. Additionally, it created opportunities for deeper integration of Echo’s technology platform, delivering greater efficiency and cost savings for customers.

Acquisition Strategic Rationale

The transaction provided Echo with resources and operational flexibility to accelerate growth, invest in technology innovation, and expand its service offerings under private ownership. This approach drove long-term value creation and competitive differentiation, while private ownership enabled Echo to pursue strategic initiatives without the short-term pressures of public markets.

The logistics and transportation technology sector is undergoing rapid transformation, with M&A activity fueled by the drive to scale advanced digital solutions, enhance operational capabilities, and consolidate market leadership in an increasingly dynamic environment. Transactions have focused on technologies that boost supply chain efficiency, optimize freight management, and meet the growing need for resilient and agile logistics systems. As companies adapt to economic and technological changes, M&A remains a pivotal strategy for unlocking synergies, fostering innovation, and seizing emerging opportunities in global markets. The sector’s sustained investment in transformative technologies reinforces its critical role as the backbone of modern supply chains, presenting significant opportunities for long-term growth and value creation. Looking ahead, investors and stakeholders are well-positioned to harness strategic M&A to address shifting industry demands and secure competitive advantages in both mature and developing markets.

Source: Uber Investor, TechCrunch, PR Newswire, E2open, Pitchbook Data.

Travel Technology Debt Capital Markets

Between Q1 2020 and Q4 2024, over $41 billion was deployed into the travel technology sector through debt financing globally, outside the United States. This sector comprises platforms that enable seamless multimodal transportation, optimize travel logistics, and leverage advanced analytics to improve traveler experiences across diverse markets.

The recovery in global travel, combined with an increasing emphasis on personalization and convenience, has fueled demand for platforms that deliver streamlined, customer-centric travel services. These include technologies such as AI-driven itinerary planning, real-time availability updates, and support for multi-destination bookings. Companies are also focusing on offering curated packages that combine transportation, accommodation, and experiences to meet diverse traveler needs.

Debt financing has been a critical tool for companies in the sector, enabling growth initiatives such as technology upgrades, market expansion, and strategic acquisitions. Many platforms utilized debt to strengthen operations and expand their geographic presence, including entering the US market through targeted acquisitions. This trend highlights the sector’s ability to leverage non-dilutive financing to address evolving consumer demands while building operational resilience and scalability in a competitive global landscape.

• Between Q1 2020 and Q4 2024, the travel technology debt capital market outside the United States demonstrated significant growth and strategic focus, with over $41 billion deployed across 238 transactions globally.
• The market reached its peak in Q4 2024 with $8 billion in capital investment. This marked a definitive move toward high-value transactions in mature and scalable travel technology platforms. The substantial growth aligns with the recovery of international travel and a rising global demand for advanced, technology-driven solutions tailored for non-US markets.
• Q2 2024 led with the highest deal count of 17 transactions. This surge highlights an active debt capital market during this period, with a strategic focus on mid-market and early-stage companies operating across regions outside the United States. These businesses are likely innovators addressing localized travel challenges with scalable solutions.
• The market maintained a steady deal count across most quarters, averaging between 10 and 15 transactions. However, capital investments fluctuated, emphasizing deliberate allocation towards larger, high-potential transactions. Q4 2024’s significant capital deployment exemplifies this strategy, where lenders focused on supporting companies poised for regional dominance or global expansion.
• Following a lull in 2021 and early 2022, the market demonstrated a strong rebound, reflecting growing confidence among investors in international travel markets. This resurgence highlights the global adaptability and resilience of travel technology companies, as debt financing flowed to those providing innovative solutions in areas such as online booking platforms, payment systems, and travel logistics.

• Debt financing has been instrumental in fueling the growth of travel technology platforms. Companies across regions, particularly in Germany (26% of capital invested) and the UK (17%), have utilized debt to fund expansions, acquisitions, and technological upgrades. Unlike equity financing, debt offers companies the ability to scale while retaining ownership, which is particularly attractive for firms in high-growth sectors.
• The UK leads deal count with 24%, suggesting a vibrant mid-market segment where debt is used for working capital, operational growth, and smaller strategic initiatives. This indicates that the UK is not only a destination for innovation but also for flexible financing structures.
• Spain captured 11% of the capital invested and 10% of deal activity. This highlights the country’s strategic role in the travel technology space, driven by its strong tourism sector. Debt deals in Spain often focus on companies modernizing tourism operations and developing localized travel technology solutions.
• Norway and China are notable for attracting a substantial share of capital—8 and 7%, respectively—despite fewer deals. These markets are investing in cutting-edge travel solutions, likely tied to sustainability in Norway and global connectivity in China.
• Mexico and Argentina, which respectively contributed 5 and 6% of capital invested, are emerging as regional leaders, leveraging debt to expand digital travel platforms, catering to rising local and regional travel demands.
• The “Other” category, capturing 11% of capital invested and 29% of the deal count, emphasizes the geographic diversity of debt deals. This includes a mix of smaller markets making targeted investments in travel technology innovations to compete globally.

• Acquisition financing accounted for the vast majority of activity, with 231 deals totaling $41 billion. This reflects a strategic focus on leveraging debt to fund mergers and acquisitions, particularly for consolidating market share, scaling platforms, and integrating advanced travel technology solutions. The prominence of acquisition financing underscores its role as the primary driver of growth and transformation in the travel technology sector.
• Growth and expansion financing made up only 2 deals, with $270 million in capital deployed. Despite the low deal count, this type of debt financing highlights its critical role in supporting early-stage or mid-sized travel technology companies seeking to enhance their infrastructure or expand into new markets.
• Buyouts and leveraged buyouts (LBOs) comprised 5 deals, totaling $510 million in capital investment. While fewer in number, buyouts reflect larger average deal sizes, often targeting cash-flow-positive companies with proven profitability. These transactions enable private equity firms to restructure and optimize businesses for long-term returns, supporting mature firms within the sector.

Deal Spotlight:

OMIO

Omio, headquartered in Berlin, Germany, is a leading travel booking platform that integrates multiple transportation options such as trains, buses, flights, and ferries into a unified interface. It enables users to compare and book tickets seamlessly, leveraging technology to simplify the complex logistics of intermodal travel planning.

By providing real-time pricing and scheduling data, Omio caters to both domestic and international travelers, emphasizing convenience, transparency, and accessibility. Its platform supports diverse customer needs, including cost-conscious travelers, frequent commuters, and global tourists.

Strategic Rationale

Omio’s $120 million debt facility aligns with its growth ambitions, particularly in potential acquisitions, scaling operations, and advancing its technological infrastructure. By securing financing from Hercules Capital Inc., Omio is poised to solidify its market leadership and enhance its platform’s capabilities to handle increasing consumer demand and global expansion. Omio’s ability to secure a sizable debt facility highlights the increasing reliance on debt capital to fund growth in travel technology. The deal reflects broader industry trends, where companies leverage debt to maintain agility while expanding their technological capabilities and market reach. As global travel rebounds, platforms like Omio play a pivotal role in simplifying consumer journeys and driving the digital transformation of travel logistics.

Deal Spotlight:

TRAVELPERK

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TravelPerk, headquartered in Barcelona, Spain, is a prominent player in the business travel management sector, offering an all-in-one platform for booking, managing, and analyzing corporate travel. Its innovative platform integrates travel expense management, dynamic reporting tools, and flexible booking systems, catering to the needs of companies of all sizes.

The platform’s ability to adapt to evolving travel demands makes it a go-to solution for modern businesses. TravelPerk has differentiated itself by offering tools for real-time updates, traveler safety management, and customizable policies, which align with the increasingly complex needs of corporate travel post-pandemic.

Strategic Rationale

The debt facility was raised to finance the acquisition of AmTrav, a US-based travel management company, and to support TravelPerk’s expansion into the North American market. This acquisition bolsters TravelPerk’s position in one of the world’s largest corporate travel markets while integrating AmTrav’s resources and customer base into its operations.

The demand for travel technology solutions has seen consistent growth and remains poised for further expansion as global travel rebounds and digital transformation accelerates. A key driver is the need for platforms that seamlessly integrate multimodal transportation options, provide real-time analytics, and enhance the traveler experience. Debt capital has become a critical tool for companies in this space, enabling strategic acquisitions, regional expansions, and technological advancements.

Investors and lenders should monitor opportunities within the sector, particularly as leading players like TravelPerk and Omio leverage debt to solidify their market positions. The sustained focus on innovation underscores the importance of scalable solutions in addressing the evolving demands of global travel markets.

Source: Mize Tech, CNBC, Allied Market Research, Pitchbook Data.

Travel Retail and Marketing Technology Solutions Transactions and Valuations

Between Q1 2020 and Q3 2024, over $102 billion was deployed across M&A transactions in the travel retail and marketing technology solutions sector. These investments reflect the increasing demand for platforms that enhance audience targeting capabilities, optimize operational parameters, and create integrated omni-channel experiences.

Travel retail and marketing technology solutions encompass platforms and systems designed to personalize the traveler experience. This includes audience analytics, real-time contextual marketing, and solutions for curating merchandise tailored to specific traveler profiles. These technologies operate within a broader marketplace ecosystem, connecting vendors and consumers to facilitate seamless, efficient, and relevant travel experiences.

The rising interest in this sector is driven by advancements in audience targeting, predictive analytics, and personalization. Omni-channel solutions now enable businesses to reach consumers at key touchpoints throughout their journeys, improving engagement and enhancing operational outcomes. The importance of these solutions is expected to grow, with increasing demand for platforms that efficiently integrate content, products, and services in dynamic market environments.

• The valuation multiples are based on a sample set of private and public travel retail and marketing technology companies and M&A transactions in the sector. The data reflects transaction activity over the analyzed period.
• The sample set typically trades at an enterprise value to revenue (EV/revenue) multiple range of 1x to 15x, with a mean of 4x and a median of 3x. These multiples reflect varying revenue growth rates and market penetration levels across the companies, with higher multiples generally corresponding to firms with scalable platforms and recurring revenue models.
• Enterprise value to EBITDA (EV/EBITDA) multiples range from 1x to 34x, with a mean of 13x and a median of 11x. This broad range indicates a mix of established and emerging players in the sector, where larger, profitable companies achieve higher multiples due to their financial stability and ability to generate consistent earnings.
• Higher EV/EBITDA multiples (17x or greater) in the sector indicate strong investor confidence in the long-term growth potential of companies offering predictive analytics, real-time contextual marketing, and integrated travel retail solutions. These companies are often seen as essential for optimizing customer engagement in a rapidly evolving market.

• Between Q1 2020 and Q3 2024, over $102 billion was deployed across 1,383 M&A transactions in the travel retail and marketing technology sector by global firms, with an average quarterly deal count of 73 and an average capital investment per quarter of $5.38 billion.
• The exceptional capital investment of $26.09 billion in Q2 2021 corresponds to a period of recovery and strategic repositioning following the global disruption caused by COVID-19. This surge was likely driven by the gradual reopening of borders and travel corridors in 2021, which led to increased demand for digital tools that optimize operations and customer engagement within the travel ecosystem. Firms sought to acquire technology platforms offering predictive analytics, omni-channel marketing, and audience-targeting capabilities to adapt to changing traveler expectations.
• Market disruptions created valuation opportunities, enabling buyers to acquire businesses at competitive prices to build comprehensive marketplace ecosystems and improve operational efficiencies.
• The 113 transactions in Q4 2021, marking the highest deal volume in the analyzed period, reflects heightened interest in smaller, strategic acquisitions. Companies expanded their portfolios by targeting specialized firms that filled gaps in omni-channel capabilities, audience analytics, or personalized product curation.
• Private equity firms and financial acquirers took advantage of market dynamics to invest in high-growth businesses with scalable solutions.
• The relatively consistent 73 deals per quarter (with a range of 46 to 113) highlight the sector’s resilience to macroeconomic fluctuations. This steady interest demonstrates a perceived necessity of travel marketing technologies in enhancing competitiveness through consumer-centric offerings and scalable ecosystems.
• Sustained M&A activity reflects a recognition of the need to personalize the travel experience, leveraging technology to deliver real-time, contextual recommendations. Firms prioritized acquiring or developing marketplace ecosystems that seamlessly integrate vendors and consumers, streamlining operations and enhancing profitability.

• US-based acquirers accounted for the largest share of both capital invested and deal count, with 38% of total capital invested and 43% of total deals. This dominance reflects a strong preference among US-based acquirers for both domestic and global opportunities in travel retail and marketing technology.
• Indonesia emerged as the second-largest recipient of capital investment, with 32% of total capital invested, showcasing the strategic focus on developing markets and the increasing adoption of travel technology solutions in the region.
• Norway captured 11% of the total capital invested, highlighting a significant interest in travel retail innovations within northern Europe.
• Smaller percentages of capital were allocated to countries such as the United Kingdom (3%), Bulgaria (3%), China (3%), and Singapore (2%), reflecting a diverse global reach of M&A activities, albeit with a lower concentration compared to top markets.
• The deal count distribution also shows diversity beyond the United States, with the United Kingdom (11%), Germany (4%), and France (5%) standing out as significant contributors to the total volume of transactions. Other countries, including India, Sweden, and Australia, accounted for 2% each, indicating broader but smaller-scale deal-making activity.
• Other countries combined represent 5% of capital invested and 24% of the deal count, underscoring a wide but fragmented interest in travel retail and marketing technology M&A across smaller or emerging markets.

• Mergers and acquisitions (M&A) represented the majority of activity, with 994 deals accounting for $52 billion in capital invested. These transactions highlight the focus on consolidating companies that deliver tailored solutions within the travel retail and marketing sectors. M&A deals were largely driven by the need for firms to align operations and improve the delivery of contextual offers during key moments in the traveler’s journey.
• Buyout/leveraged buyouts (LBOs) accounted for 380 transactions and $46 billion in capital, indicating significant interest in acquiring companies with established operational frameworks and cash flow. The focus on buyouts suggests that investors view mature businesses with specialized technologies, such as predictive analytics and real-time engagement platforms, as opportunities for stable returns and market differentiation.
• Public-to-private transactions, though fewer at 9 deals with $4 billion in capital, were critical in redefining larger, public businesses with untapped potential. These deals demonstrate the approach of unlocking value by repositioning companies for strategic execution outside of public market pressures, often targeting firms with strong operational fundamentals but underutilized technologies.

Deal Spotlight:

INRIVER

Inriver, headquartered in Malmö, Sweden, provides product information management (PIM) solutions, enabling businesses to centralize and standardize product data for distribution across multiple channels. While its core applications span various sectors, including retail and manufacturing, its relevance to travel retail lies in its ability to support omni-channel strategies, streamline inventory management, and ensure accurate product data across diverse touchpoints.

In the travel retail sector, inriver’s platform aligns with the need for efficient merchandise curation within complex marketplace ecosystems, where seamless and accurate integration of product information is critical to maintaining operational efficiency and enhancing customer satisfaction.

Strategic Rationale

The acquisition of inriver by Thomas H. Lee Partners reflects key trends within the travel retail and marketing technology space, driven by the increasing complexity of managing and delivering consistent product data across fragmented distribution networks.

Deal Spotlight:

BRANDWATCH

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Brandwatch, headquartered in Brighton, United Kingdom, is a leader in digital consumer intelligence and social media listening solutions. The company enables businesses to analyze online conversations and consumer sentiment across multiple channels, providing insights critical for strategic marketing and customer engagement. Brandwatch’s tools allow companies to understand customer behavior, identify trends, and refine audience targeting strategies.

In the context of travel retail and marketing technology, Brandwatch’s capabilities are relevant for understanding traveler sentiment and market shifts, particularly in response to global events or regional disruptions. Its analytics tools help travel retailers and marketers optimize campaigns, enhance audience engagement, and adapt to changing consumer preferences.

Strategic Rationale

The acquisition of Brandwatch by Cision US reflects a growing focus on leveraging data-driven insights to improve marketing outcomes. The deal is a strategic move to combine Brandwatch’s consumer intelligence capabilities with Cision’s expertise in PR and media management, creating a comprehensive platform for communication and marketing optimization. By integrating Brandwatch’s capabilities, Cision US aims to provide a more robust offering to businesses navigating the challenges of audience engagement in dynamic markets, including travel retail. This acquisition highlights the increasing importance of data analytics and real-time sentiment tracking in shaping marketing strategies.

The demand for travel retail and marketing technology solutions continues to grow, driven by advancements in audience targeting, omni-channel engagement, and marketplace ecosystems. Key trends include the integration of predictive analytics and real-time personalization tools, enabling businesses to curate merchandise and optimize customer experiences. These innovations address challenges in a highly dynamic sector, where operational efficiency and adaptability are critical. Founders and shareholders in this space should monitor exit opportunities, as financial acquirers remain highly active, contributing significant capital to drive consolidation and innovation. This focus underscores the sector’s importance in shaping the future of travel retail.

Source: RFI.Asia, Global Drinks Intel, iClick Interactive, Pitchbook Data.

Cloud Infrastructure Modernization M&A Transactions and Valuations

The cloud infrastructure modernization sector experienced significant growth from Q1 2020 to Q3 2024, driven by the widespread adoption of digital transformation initiatives. Organizations across industries focused on cloud migration, automation, and advanced analytics to improve scalability and operational efficiency, which increased the demand for innovative solutions. Hybrid work environments and the need for resilient, scalable infrastructure prompted higher investments in cloud technologies, making modernization essential for enterprise strategies.

This report analyzes transaction trends, valuation metrics, and regional dynamics, providing a detailed assessment of the strategic drivers influencing M&A activity in the cloud infrastructure modernization sector. Metrics such as EV/revenue and EV/EBITDA highlight investor priorities and reveal market conditions that shape valuations. Key transactions, including Blackstone’s acquisition of R Systems International, BPEA EQT’s investment in Virtusa, and the Blackstone-led buyout of Mphasis, illustrate the sector’s focus on technological advancements, achieving scale, and consolidating market leadership. These examples demonstrate the impact of strategic M&A on the competitive landscape and offer insights to investors, advisors, and stakeholders navigating the market.

• Valuation multiples are based on a sample set of private and public M&A transactions in the cloud infrastructure modernization sector, using data collected on December 9, 2024.
• The data shows a wide range of implied multiples for both EV/revenue and EV/EBITDA, reflecting the high level of fragmentation in the sector and the varying maturity levels of companies. Early-stage firms with niche technologies often report lower multiples due to limited revenue or scalability. In contrast, companies with differentiated offerings, strong customer bases, and robust growth trajectories achieve higher valuation multiples.
• Larger companies achieve higher EV/EBITDA multiples by leveraging economies of scale, diversified revenue streams, and stronger profitability metrics. Investors often favor these companies for their scalability and stability. However, higher EV/EBITDA multiples without corresponding revenue growth may signal expectations of future operational efficiency or market expansion.
• Mid-sized firms, with enterprise values ranging from $10 million to $100 million, dominate the EV/revenue spectrum. These firms typically maintain established revenue bases but may not yet generate the profitability required to achieve high EV/EBITDA multiples. Outliers within this group include fast-growing firms with innovative products or services, which attract attention as acquisition targets in the cloud modernization sector.

Capital Markets Activities

The data highlights transaction trends, valuation metrics, and regional dynamics in the cloud infrastructure modernization sector. The widespread adoption of cloud technologies and the growing demand for scalable, efficient infrastructure solutions have driven deal activity and shaped valuations. Investors have utilized varied deal structures and geographic approaches to capitalize on opportunities, influencing M&A dynamics and redefining the competitive landscape.

• Between Q1 2020 and Q3 2024, investors allocated approximately $79 billion across 2,196 deals in the cloud infrastructure modernization sector. This level of capital investment and deal volume demonstrates strong and sustained activity, emphasizing the sector’s importance in supporting digital transformation across industries.
• Capital investment peaked in Q1 2021 and Q4 2023, with each quarter exceeding $10 billion. These peaks suggest strategic responses to technological advancements and significant mergers and acquisitions during these periods. In contrast, the lower investment levels in early 2022 indicate possible event-driven variations in the sector.
• The sector maintained consistent deal activity through 2024, even with fluctuating capital investments. This suggests that investors remain engaged, adapting their strategies toward selective, high-value projects and adjusting their approaches in response to evolving market conditions.

The graphs below present the geographic distribution of transactions, providing additional detail on regional trends and investment dynamics.

• The United States accounts for 50% of the capital invested and 38% of the deal count in the cloud infrastructure modernization sector. This high level of activity reflects the country’s advanced cloud market and strong investor confidence in its scalability and innovation. US-based transactions often involve significant capital outlays in well-established companies, as well as a steady stream of deals targeting emerging cloud technologies, driving global trends in modernization.
• The United Kingdom contributed 9% of the deal count and 6% of the capital invested. The UK’s activity is characterized by smaller- to medium-sized transactions, often supporting early-stage firms and niche technology providers. This focus creates opportunities for diverse investors to back innovation while fostering a competitive and vibrant market for cloud technologies. Key areas of investment include cloud migration services, hybrid cloud solutions, and cybersecurity enhancements, which align with the region’s growing demand for advanced IT infrastructure.
• Smaller and emerging markets represent 39% of the deal count and 23% of the capital invested. These markets collectively drive significant global activity through numerous smaller-scale transactions, with investments frequently targeting localized cloud solutions, infrastructure automation, and data management technologies. This broad participation highlights a global trend toward adopting cloud technologies and demonstrates the potential for smaller markets to influence overall sector growth. By attracting investments across various regions, these markets contribute to a diversified and resilient ecosystem of cloud modernization.

The deal-type dynamics below set the stage for understanding how capital flows and how strategic priorities shape the cloud infrastructure modernization sector’s growth and landscape.

• M&A activity accounted for $44 billion across 1,291 deals, showing a strategic focus on growth through consolidation. Companies in the cloud infrastructure modernization sector use M&A to acquire complementary technologies, expand their geographic reach, and strengthen service offerings. This approach plays a critical role in enabling firms to remain competitive in a market shaped by technology integration and digital transformation.
• Buyouts accounted for $35 billion across 905 deals, reflecting a higher average capital deployment per transaction. Investors prioritized established, high-value targets with proven business models and revenue streams. Private equity firms often focus on mature companies that provide steady returns or act as platforms for additional acquisitions, aligning these investments with long-term value-creation strategies.
• The high deal count in M&A—1,291—compared to buyouts—905—demonstrates that the cloud infrastructure modernization sector remains fragmented, with many smaller or mid-sized players being acquired. Larger firms continue to integrate smaller innovators or capture new capabilities to meet the rising demand for cloud solutions. This activity demonstrates ongoing consolidation efforts and highlights the dynamic nature of the sector, where new entrants and emerging technologies consistently reshape the competitive landscape.

M&A Transactions Case Studies

Three notable M&A transactions in the cloud infrastructure modernization sector highlight strategic growth through enhanced market leadership, advanced technological capabilities, and increased scalability. These deals prioritized global expansion, operational efficiency, and innovation, reshaping the competitive landscape. Investors applied targeted strategies to promote sustainable growth and deliver long-term value in this fast-evolving industry.

Case Study 01

VIRTUSA

Virtusa Corporation, based in the US, helps businesses accelerate innovation and improve efficiency by providing digital transformation services, IT consulting, and engineering solutions, with expertise in cloud migration, artificial intelligence, data analytics, and application modernization.

Transaction Structure

Virtusa Corporation’s acquisition was funded through a blend of equity and debt. The equity component was contributed by a consortium of buyers, including BPEA EQT, CPP Investments, and GIC, while over $1 billion in debt financing underpinned the transaction.

Market and Customer Segments Combination

Virtusa serves a wide range of industries, including financial services, healthcare, telecommunications, media, and technology, offering expertise in digital transformation and IT consulting. The acquisition enabled access to complementary markets and customer segments across the Asia-Pacific region and beyond, utilizing Virtusa’s capabilities to deliver value to enterprises undergoing modernization.

Acquisition Strategic Rationale

The acquisition aimed to capitalize on Virtusa’s strong position in digital transformation, cloud services, and application modernization to enhance its growth potential in a rapidly evolving IT landscape. Virtusa gained strategic resources and financial support to expand its global reach, deepen its offerings in high-demand sectors, and strengthen its ability to compete in a challenging market. The transaction also aligned with the consortium’s investment focus on innovative, high-growth technology businesses.

Case Study 02

MPHASIS

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Mphasis Limited, based in India, is a multinational IT services and consulting company. It specializes in infrastructure technology, application outsourcing, architecture guidance, application development and integration, and application management services, serving industries such as financial services, telecom, logistics, and technology.

Transaction Structure

Blackstone, in partnership with co-investors ADIA, UC Investments, and GIC, acquired a controlling stake in Mphasis Limited through a public-to-private leveraged buyout valued at approximately $3 billion. The transaction involved transitioning the company into continuation funds—an investment vehicle designed to maintain ownership and drive further growth—resulting in a valuation of approximately $4 billion.

Market and Customer Segments Combination

Mphasis brings its IT services and consulting expertise to a broad spectrum of industries, including financial services, telecommunications, logistics, and technology. Blackstone and its co-investors leveraged the acquisition to capitalize on Mphasis’s established market presence and extensive customer base, which created synergies with Blackstone’s other portfolio companies and broadened Mphasis’s footprint in emerging and global markets.

Acquisition Strategic Rationale

The acquisition supported Blackstone’s strategy of investing in high-growth IT services and digital transformation businesses. Mphasis’s expertise in cloud services, application modernization, and infrastructure technology established its role as a pivotal player in the digital economy. Leveraging continuation funds, the deal facilitated long-term investments to expand Mphasis’s capabilities, foster innovation, and seize emerging opportunities in global IT markets.

Case Study 03

R SYSTEMS

R Systems International, based in India, delivers cutting-edge digital IT services, focusing on product engineering, advanced analytics, artificial intelligence, cloud enablement, and robotic process automation, helping businesses accelerate innovation and enhance operational efficiency.

Transaction Structure

Blackstone acquired a controlling 52% stake in R Systems International for approximately $360 million, equating to an average price of $3 per share. Following this initial acquisition, the firm launched a delisting offer at the same price of $3 per share to purchase the remaining publicly held shares. This delisting process was aimed at transitioning R Systems from a publicly traded company to a privately held entity under Blackstone’s management.

Market and Customer Segments Combination

R Systems serves global enterprises across diverse industries, including technology, financial services, healthcare, and telecommunications, with its specialized digital IT services. Blackstone’s acquisition created synergies with its portfolio companies, expanded R Systems’s reach into new markets and customer segments, and strengthened its position in high-demand sectors such as AI, cloud, and automation.

Acquisition Strategic Rationale

The acquisition aligned with Blackstone’s strategy to invest in high-growth digital transformation companies. R Systems’s expertise in advanced technologies, including AI and cloud enablement, complemented Blackstone’s focus on scaling innovative businesses. The transaction positioned R Systems to leverage Blackstone’s resources for accelerated growth, improved operational efficiency, and deeper penetration into global markets.

The cloud infrastructure modernization sector continues to evolve as a critical enabler of digital transformation, with M&A activity at its core. Strategic acquisitions reflect a focus on enhancing technological capabilities, consolidating market presence, and addressing the growing demand for scalable and innovative solutions. Key transactions highlight the importance of operational efficiency, product differentiation, and geographic expansion in maintaining competitive advantage.

As businesses increasingly prioritize digital transformation, the sector is poised for sustained growth, offering significant opportunities for value creation. The continued focus on strategic investments and innovation positions companies to capitalize on emerging technologies and evolving market needs. These trends not only shape the trajectory of the sector but also underscore its vital role in driving global economic and technological progress.

Source: EQT, VCCircle, Blackstone (1), (2), Pitchbook Data.

EdTech M&A Transactions and Valuations

The COVID-19 pandemic accelerated the shift to digital learning and increased the demand for innovative educational technologies, driving a surge in M&A activity in educational technology (EdTech) from Q1 2020 to Q3 2024. Schools, universities, and corporations transitioned to remote and hybrid models, relying on EdTech tools to improve accessibility, engagement, and scalability in education. Beyond the pandemic, organizations have adopted digital platforms as a key component of modern education systems to address needs such as personalized learning, workforce training, and lifelong skill development. This report reviews transaction trends, valuation metrics, and regional dynamics while analyzing the strategic factors influencing M&A activity. Valuation multiples, such as EV/revenue and EV/EBITDA, provide insights into market conditions and the criteria investors use to determine value in a competitive landscape.

Notable transactions, such as Dragoneer Investment Group’s acquisition of Instructure, the Goldman Sachs-led consortium’s investment in Kahoot!, and General Atlantic and Dragoneer’s buyout of Arco Platform, demonstrate the focus on scaling innovative solutions, enhancing product offerings, and consolidating market leadership. These examples highlight the role of strategic M&A in transforming the EdTech ecosystem and offer practical insights for investors, financial advisors, and industry stakeholders operating in this evolving market.

• Valuation multiples are based on a sample set of private and public M&A transactions in EdTech, using data collected on December 4, 2024.
• EV/EBITDA often carries higher implied multiples compared to EV/revenue, particularly for enterprise values ranging from $10 million to $1 billion. Profitability, rather than sheer revenue generation, acts as the primary benchmark for valuing mid-sized to large EdTech companies. These firms typically feature more mature business models, predictable cash flows, and established customer bases, which reduce perceived risk and justify higher valuation multiples.
• Lower implied multiples characterize both EV/revenue and EV/EBITDA for companies with enterprise values below $10 million. This reflects the challenges early stage EdTech ventures face, such as limited profitability, higher operational risks, and reliance on external funding for growth. Revenue alone often falls short of guaranteeing long-term sustainability, as profitability remains a distant goal, leading to restrained valuations.
• As enterprise values exceed $100 million, the gap between EV/revenue and EV/EBITDA multiples widens. This reflects the scalability and market leadership of these firms, emphasizing their ability to dominate segments, innovate at scale, and leverage operational efficiencies. These companies often achieve premium valuations because of their capacity to maintain competitive advantages and drive growth in a consolidating industry.

Capital Markets Activities

The data reflects transaction trends, valuation metrics, and regional dynamics in EdTech. The global shift to digital learning and the increased adoption of innovative educational technologies have driven deal activity and shaped valuations. Investors have employed diverse deal structures and geographic strategies, influencing M&A dynamics and transforming the competitive landscape.

• Between Q1 2020 and Q3 2024, investments in EdTech totaled $82 billion across 2,148 deals, with an average deal size of $38 million. Capital investment peaked in Q2 2021 at $15 billion across 147 deals, reflecting heightened demand for EdTech solutions during the COVID-19 pandemic. The global transition to remote and hybrid education models during this period drove significant investor interest and the highest levels of deal activity.
• From 2020 to 2022, deal counts remained strong, consistently exceeding 100 deals per quarter. However, capital investment fluctuated, reflecting a shift toward fewer, high-value transactions as investors prioritized scaling established EdTech companies over funding smaller, early stage ventures. 
• In 2023 and early 2024, capital investment and deal count declined, driven by a reduced urgency for digital learning solutions in the post-pandemic environment and macroeconomic pressures, including inflation and rising interest rates. During this period, investors shifted their focus to high-potential, established companies with proven profitability and scalability, avoiding widespread funding of smaller, riskier ventures.
• By Q3 2024, deal activity began to stabilize, with investors completing over 80 deals in the quarter. This recovery indicates renewed confidence in EdTech’s long-term growth potential and sustained demand for innovative education technologies, particularly in scalable and profitable ventures.

The graphs below present the geographic distribution of transactions, providing additional detail on regional trends and investment dynamics.

• Investors in the United States contributed 63% of total capital invested in EdTech and accounted for 41% of global deals. This dominance reflects the US’s role as the largest market for educational technology innovation and a primary source of investment capital. Large-scale transactions within the US and significant capital flow into global markets are driven by its strong tech-forward culture, institutional support, and access to venture capital.
• Emerging markets, including Brazil (4% of deals, 3% of capital) and India (6% of deals, 3% of capital), attract smaller but impactful investments focused on addressing local education challenges. Both domestic and international investors prioritize smaller, localized deals in these regions, emphasizing their growth potential and the need for EdTech solutions.
• The United Kingdom accounts for 11% of deals and 6% of capital invested, reflecting concentrated investments with a higher capital-to-deal ratio. Investors focus on fewer, larger transactions to scale established EdTech companies and foster public-private partnerships, aligning with Europe’s expanding digital education initiatives.
• The other countries account for 14% of capital invested and 38% of total deals, reflecting global interest in smaller, high-frequency transactions across diverse regions. These investments highlight the growing importance of localized EdTech solutions and the untapped potential of emerging markets worldwide.

The deal-type dynamics below set the stage for understanding how capital flows and strategic priorities shape the EdTech industry’s growth and landscape.

• Investors completed 1,307 M&A deals in EdTech, significantly outpacing the 841 buyouts. Companies focused on mergers and acquisitions to expand capabilities, gain market share, and drive innovation through partnerships rather than pursuing outright ownership.
• Investors allocated $53 billion to buyouts, compared to $29 billion for M&A deals, reflecting a preference for larger-scale transactions in buyouts. These deals often involved acquiring controlling stakes in well-established EdTech companies with proven business models.
• The figures illustrate two distinct investment strategies in EdTech. M&A deals focused on fostering collaboration and integrating complementary technologies, typically through smaller transactions. In contrast, buyouts emphasized consolidating market leaders and scaling proven technologies with substantial financial backing. These approaches allowed investors to address both growth and consolidation opportunities effectively.

M&A Transactions Case Studies

Three notable M&A transactions in the EdTech industry reflect strategic growth achieved by enhancing market leadership, advancing technological capabilities, and addressing the increasing demand for innovative educational solutions. These transactions focused on scalability, product innovation, and global expansion, transforming the competitive landscape of education technology. Investors leveraged tailored financial and operational strategies to foster sustainable growth and create long-term value in this rapidly evolving market.

Case Study 01

INSTRUCTURE

Instructure is a leading US-based educational technology company, best known for its cloud-based Canvas learning management system (LMS), which supports online teaching, course management, and collaboration for schools, universities, and organizations worldwide.

Transaction Structure

KKR and Dragoneer Investment Group acquired Instructure in a deal valued at approximately $5 billion, backed by over $2 billion in debt financing. The all-cash transaction, executed at $24 per share, resulted in Instructure’s delisting from the New York Stock Exchange.

Market and Customer Segments Combination

Instructure serves a broad customer base, including K-12 schools, higher education institutions, and corporate training organizations, providing scalable solutions for online learning and collaboration. The combination with KKR and Dragoneer Investment Group’s resources aimed to enhance Instructure’s ability to meet the growing demand for digital learning tools globally, particularly as educational institutions and enterprises increasingly adopted online and hybrid learning models.

Acquisition Strategic Rationale

The acquisition aimed to accelerate Instructure’s growth, foster product innovation, and expand its global footprint in EdTech. With KKR and Dragoneer’s backing, Instructure leveraged additional capital and expertise to strengthen its market leadership, enhance customer experiences, and capitalize on the rising demand for technology-driven education solutions worldwide.

Case Study 02

KAHOOT!

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Kahoot! is a Norwegian EdTech company that offers a gamified learning platform for interactive quizzes, lessons, and activities. Accessible across devices, it supports K-12 schools, higher education institutions, corporate training, and individual learners, fostering engagement and knowledge retention. Known for its innovation, Kahoot! has established itself as a global leader in transforming education and training into interactive experiences.

Transaction Structure

A consortium led by Goldman Sachs Asset Management’s Private Equity division acquired Kahoot! for approximately $2 billion. The offer, equivalent to $4 per share, reflected a 53% premium over its May 22, 2023, share price. Following the acquisition, Kahoot! was delisted from the Oslo Børs on January 23, 2024, transitioning to private ownership.

Market and Customer Segments Combination

Kahoot! serves a diverse customer base, including K-12 schools, higher education institutions, corporate training organizations, and individual users. The acquisition enabled the consortium to expand Kahoot!’s reach across these segments by utilizing its global networks and expertise in scaling technology companies to meet the growing demand for gamified learning tools in education and business environments.

Acquisition Strategic Rationale

The acquisition aimed to accelerate Kahoot!’s global growth by expanding its market presence in high-growth regions, enhancing product innovation through interactive and gamified learning solutions, and leveraging the expertise of investors like General Atlantic and KIRKBI to strengthen its international footprint in corporate and educational segments. These goals align with Kahoot!’s mission to make learning engaging and accessible worldwide.

Case Study 03

ARCO PLATFORM

Arco Platform is a Brazilian EdTech company that provides learning systems, curriculum content, and digital tools for K-12 private schools. Its integrated platforms enhance learning, streamline administration, and support personalized education, empowering educators with data-driven insights and innovative resources to address evolving educational needs.

Transaction Structure

Dragoneer Investment Group and General Atlantic completed the acquisition of a 59% stake in Arco Platform as part of a $2 billion leveraged buyout finalized in December 2023. The transaction, priced at $14 per share in cash, used debt financing to ensure strategic leadership continuity and optimize capital allocation.

Market and Customer Segments Combination

Arco Platform serves the K-12 private school segment in Brazil, offering integrated learning systems, educational content, and digital tools. The acquisition by General Atlantic and Dragoneer aligned with their focus on education technology in emerging markets, combining Arco’s expertise in the Brazilian education system with the investors’ global resources to further expand into the growing K-12 private education market.

Acquisition Strategic Rationale

The acquisition aimed to strengthen Arco’s market leadership in Brazil, enhance product innovation, and expand digital offerings for K-12 education. By leveraging the strategic and financial support of General Atlantic and Dragoneer, along with continued leadership by Arco’s founder and management, the deal positioned the company to scale operations, accelerate growth, and meet the increasing demand for high-quality EdTech solutions in Latin America.

EdTech continues to evolve, with strategic M&A activity centered on scaling innovative learning solutions, expanding digital capabilities, and consolidating market positions to remain competitive in a dynamic education landscape. Transactions highlight priorities such as enhancing technological innovation, improving scalability, and addressing the growing global demand for accessible and engaging educational tools. Companies are actively leveraging M&A to drive growth, foster collaboration, and adapt to the shifting needs of learners and institutions, creating substantial opportunities for value creation in both mature and emerging education markets. Companies are strategically positioning themselves to capitalize on emerging opportunities and adapt to evolving market demands, creating significant potential for value generation in both established and developing education markets.

Source: PR Newswire, Private Equity Wire, MarketScreener, Reuters, Pitchbook Data.

Marine Engineering Sector M&A Transactions and Valuations

The marine engineering sector supports global trade, defense, and energy by designing, constructing, repairing, and maintaining ships, offshore structures, and maritime systems, ensuring safe, efficient, and sustainable operations. The sector experienced significant M&A activity in recent years to meet the increasing demand for advanced engineering solutions in shipbuilding, repair, and maintenance services. This report analyzes transaction trends, valuation multiples, and regional dynamics from Q1 2020 to Q3 2024, highlighting the strategic rationales behind these deals.

Valuation metrics such as EV/revenue and EV/EBITDA emphasize industry priorities, including profitability, operational efficiency, and scalability. Transactions such as Lone Star Funds’ investment in Vigor Industrial, Sembcorp Marine’s acquisition of Keppel Offshore & Marine, and Temasek Holdings’ investment into Sembcorp Marine highlight efforts to consolidate markets, advance technology, and enhance operational capabilities. These examples illustrate how M&A activity reshapes the competitive landscape and offers insights for investors, advisors, and industry leaders.

• Valuation multiples are based on a sample set of private and public M&A transactions within the marine engineering sector, using data collected on November 28, 2024.
• EV/EBITDA multiples consistently exceed EV/revenue multiples. This shows that valuations prioritize operational profitability EBITDA over revenue, without reflecting cost efficiencies. Investors assign higher valuations to companies with stronger profitability metrics, particularly in an industry where efficiency and cost management significantly influence financial performance.
• Marine engineering companies with enterprise values below $100 million show dispersion in both EV/revenue and EV/EBITDA multiples, with some outlier multiples. Higher growth expectations or elevated risk profiles often cause this dispersion. The difficulty of valuing smaller firms also contributes to the variability, as project-based revenue streams or specific market dependencies frequently cause financial metrics to fluctuate.
• Companies with enterprise values above $1 billion display tighter clustering and stabilization in EV/revenue and EV/EBITDA multiples. Established operations, diversified revenue streams, and predictable cash flows drive this stability, making larger firms less vulnerable to market fluctuations. These characteristics enable more reliable valuation methods, which are less influenced by speculative assumptions.

Capital Markets Activities

The data reflects transaction trends, valuation metrics, and regional dynamics within the sector. Demand for vessel upgrades and advancements in repair technologies have driven deal activity and valuations. The geographic distribution of deals and transaction structures has reshaped M&A dynamics and the competitive landscape.

• Investors contributed over $126 billion across 2,486 deals in the marine engineering sector between Q1 2020 and Q3 2024, with an average deal size of approximately $51 million.
• Investors deployed over $17 billion into Q4 2021, a significant increase from earlier quarters. Large-scale transactions drove this surge as companies consolidated market share, improved operational efficiencies, and entered new markets. Market optimism and post-pandemic recovery spurred the rise in investment, encouraging more ambitious deals. Larger firms pursued strategic acquisitions to gain a competitive edge in the recovering global economy.
• Capital investment peaked, but deal counts fluctuated significantly over the quarters. In Q4 2021, deal volume hit 172 transactions, highlighting a surge in M&A activity. Deal numbers declined in subsequent quarters as large-scale transactions gained prominence and smaller deals became less frequent. Market consolidation, regulatory hurdles, and a shift toward fewer, larger deals likely drove this decline. These fluctuations demonstrate the market’s volatility and evolving transaction strategies.
• Investors significantly reduced both capital investment and deal activity in the first half of 2024. In Q2 2024, they invested just over $3 billion across 106 deals, marking the lowest level in several quarters. This decline likely reflects a market slowdown driven by rising interest rates, economic uncertainty, and shifting market conditions. Investors exhibited greater caution, focusing on smaller, less capital-intensive transactions and moving away from large-scale deals. This shift indicates a preference for strategic, niche acquisitions as companies prioritized preserving capital and maintaining operational flexibility amidst uncertainty.

The graphs below present the geographic distribution of transactions, providing additional detail on regional trends and investment dynamics.

• The United States leads with 34% of capital invested and 33% of deal volume, highlighting its central role in the marine engineering sector. Advanced infrastructure and significant offshore and shipbuilding projects drive its robust market for both large-scale investments and high transaction volumes.
• Other regions collectively contribute 31% of the capital invested and 37% of the deal volume, showing a larger number of smaller-scale transactions outside major markets like the US and the UK. Emerging or niche markets account for many of these deals, where investments are typically less capital-intensive.
• The United Kingdom captures 12% of capital invested and 13% of deal volume, indicating its focus on a relatively higher number of smaller-sized deals. This suggests the UK emphasizes diversified investments in mid-sized or emerging marine engineering companies.

The deal-type dynamics below set the stage for understanding how capital flows and strategic priorities shape the revenue cycle management technology and services sector growth and landscape.

• M&A activity drives both the highest capital invested and deal count, with $73 billion invested across 1,592 transactions. Companies use M&A as a key growth strategy to expand market share, gain competitive advantages, and achieve vertical integration. Companies actively pursue synergies and consolidations through these high deal volumes to meet evolving market demands.
• Buyouts account for a smaller share of both capital and deal count, with $53 billion invested across 894 transactions. Private equity firms often lead buyouts to acquire control and improve operational efficiencies. This smaller deal count reflects a more selective approach, with firms targeting high-value opportunities over volume.
• M&A deals achieve higher activity per dollar invested compared to buyouts, averaging $46 million per deal versus $59 million for buyouts. Companies frequently use M&A for smaller-scale or diversified acquisitions, while buyouts focus on fewer but larger investments. This highlights the strategic nature of buyouts compared to the broader and more dynamic scope of M&A activity.

M&A Transactions Case Studies

Three key M&A transactions reflect strategic growth in the marine engineering sector by enhancing market positions, expanding services, and improving efficiency. These transactions align with industry demands for advanced solutions, emphasizing scalability, technology, and competitive consolidation.

Case Study 01

VIGOR INDUSTRIAL

Vigor Industrial is a leading US-based company specializing in shipbuilding, ship repair, and heavy industrial services, serving defense, commercial, and infrastructure markets with expertise in constructing and maintaining vessels and providing advanced fabrication solutions.

Transaction Structure

Lone Star Funds, a global private equity firm, acquired Titan Acquisition Holdings, the parent company of Vigor Industrial, through a leveraged buyout completed on June 15, 2023. The transaction was valued at $2 billion and supported by more than $7 million in debt financing.

Market and Customer Segments Combination

The acquisition brought together complementary capabilities and customer bases, combining Vigor Industrial’s expertise in shipbuilding and repair for defense and commercial markets with Lone Star Funds’ strategic focus on critical infrastructure and industrial businesses. This synergy allowed for expanded offerings to government, maritime, and industrial clients and positioned the combined entity to capitalize on long-term demand in both defense and commercial maritime sectors. The integration enhanced access to high-value government contracts and strengthened the ability to serve large-scale infrastructure projects and specialized maritime needs.

Acquisition Strategic Rationale

The investment by Lone Star Funds aligned with its strategy of investing in critical infrastructure and industrial businesses with significant growth potential. Vigor Industrial provided Lone Star Funds with a strong foothold in the US maritime and defense industries, which are poised for steady demand due to infrastructure upgrades, increased defense spending, and maritime trade. Additionally, integrating Vigor’s advanced fabrication capabilities and robust government contracts supported Lone Star’s objectives to enhance operational efficiencies and unlock long-term value through scale and strategic investments.

Case Study 02

KEPPEL O&M

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Keppel Offshore & Marine, formerly a Singapore-based global leader in offshore rig design, construction, repair, and shipbuilding, specialized in solutions for the oil and gas, renewable energy, and maritime industries before its merger with Sembcorp Marine in February 2023, which resulted in the formation of Seatrium Limited.

Transaction Structure

Sembcorp Marine acquired Keppel Offshore & Marine in a transaction valued at more than $3 billion. The deal was structured as an all-stock transaction. It granted Keppel Corporation shareholders 54% ownership of the merged entity.

Market and Customer Segments Combination

The merger combined Keppel Offshore & Marine’s expertise in offshore rig design, shipbuilding, and repair with Sembcorp Marine’s focus on marine and energy engineering, forming a diversified entity that serves oil and gas, renewable energy, infrastructure, and maritime sectors. The combined customer base includes global energy companies, shipowners, and governments, enabling the new entity to capitalize on opportunities in traditional energy markets and meet the growing demand for renewable and decarbonization solutions.

Acquisition Strategic Rationale

The acquisition sought to enhance operational synergies and scale, enabling the merged entity to compete more effectively in the evolving energy and maritime sectors. By combining Keppel’s offshore engineering expertise with Sembcorp Marine’s sustainability initiatives, the company positioned itself to expand into new energy solutions, including wind farms, hydrogen projects, and decarbonization technologies. The transaction consolidated resources and reduced competition, creating a unified platform to foster innovation and drive growth in both traditional and renewable energy markets.

Case Study 03

SEATRIUM

Sembcorp Marine, now known as Seatrium, is a leading global provider of innovative engineering solutions for the offshore, marine, and energy industries, with a focus on renewable energy and decarbonization technologies.

Transaction Structure

In September 2021, Temasek Holdings acquired Sembcorp Marine, a Singapore-based global marine and offshore engineering group, through a leveraged buyout valued at more than $1 billion, bringing the company’s total valuation to approximately $2 billion.

Market and Customer Segments Combination

The acquisition combined Sembcorp Marine’s expertise in offshore rig design, shipbuilding, and marine engineering with Temasek’s financial backing, enabling Sembcorp to further capitalize on opportunities in offshore wind energy and sustainable solutions. This enhanced Sembcorp Marine’s presence in both traditional energy and emerging clean energy markets, expanding its customer base across global energy firms, shipowners, and governments.

Acquisition Strategic Rationale

Temasek’s acquisition of Sembcorp was driven by its alignment with sustainability goals, leveraging Sembcorp’s renewable energy pivot to enhance its green energy presence in Asia, while streamlining portfolio synergies and governance. The move also aimed to unlock long-term value through operational restructuring, capitalize on Sembcorp’s strengthened financial position, and strengthen leadership in Asia-Pacific’s energy and infrastructure sectors, all in support of Singapore’s broader national sustainability objectives.

The marine engineering sector continues to evolve, with strategic M&A activity centered on strengthening market positions and responding to growing demand for advanced engineering solutions in ship repair, shipbuilding, and maritime services. Transactions highlight the industry’s focus on enhancing operational efficiencies, expanding technological capabilities, and consolidating market presence to stay competitive. Companies are actively pursuing growth through innovation and strategic investments, positioning themselves to capitalize on both established and emerging maritime market opportunities. These developments create significant avenues for value creation and long-term growth in the global marine engineering landscape.

Source: Defense Daily, Vigor, Maritime Executive, The Strait Times, Pitchbook Data.

Security and Communications Infrastructure Solutions Transactions and Valuations

Between Q1 2020 and Q3 2024, approximately $483 billion was invested in the security and communications infrastructure solutions sector through M&A transactions conducted by global firms. This period reflects heightened activity driven by the increasing need for scalable solutions that address growing demands for connectivity, automation, and increased operational efficiency.

The security and communications infrastructure sector plays a critical role in enabling businesses to adapt to complex, multi-vendor environments and rapidly evolving technological requirements. The market spans advanced network management, monitoring systems, and tools designed to improve the performance of communications infrastructure. These solutions are essential for industries reliant on real-time data exchange, secure communications, and reliable network uptime. Key service areas such as telecom cabling, distributed antenna systems (DAS), and end-to-end network monitoring are driving growth, providing essential tools for secure, integrated, and automated infrastructure across industries.

As the demand for automation and interoperability grows, companies are investing in technologies that streamline operations and optimize resource utilization. Increasingly, buyers are prioritizing solutions that support seamless integration, reduce downtime, and increase scalability to meet future demands. The sector’s importance is further underscored by global trends in digital transformation and the modernization of critical communications systems.

This report provides an in-depth analysis of M&A transactions within the sector, highlighting transaction trends, valuation patterns, and strategic drivers. It examines the evolving dynamics shaping the market, offering insights for businesses, advisors, and investors seeking to understand the opportunities and challenges that define the future of security and communications infrastructure solutions.

• The valuation multiples for enterprise value (EV) to revenue in the security and communications infrastructure solutions sector ranged from 1x to 20x, with a mean of 4x and a median of 2x. These multiples reflect the diverse nature of revenue streams within this sector, ranging from high-growth subscription-based models to more traditional hardware-centric businesses. The higher end of the range indicates acquirers’ willingness to pay premiums for companies with strong market positions and scalable solutions.
• EV to EBITDA multiples ranged from 2x to 26x, with a mean of 11x and a median of 10x. These higher multiples highlight the sector’s focus on operational efficiency and its reliance on advanced technologies that can deliver long-term cost savings and productivity gains. Companies with proven capabilities to integrate multi-vendor environments and automate complex systems are commanding the highest valuations.
• Acquirers in the sector are targeting businesses that provide comprehensive solutions for managing critical infrastructure, leading to valuation premiums for companies with innovative offerings. The relatively high EBITDA multiples signal a market environment where buyers prioritize operational potential and long-term strategic fit over immediate profitability.

• Between Q1 2020 and Q3 2024, a total of $483 billion was invested across 1,934 M&A transactions in the security and communications infrastructure solutions sector. The average deal size during this period was approximately $250 million, highlighting the high-value nature of investments in this critical infrastructure sector.
• The sector witnessed the highest capital investment of $56.61 billion in Q2 2021, accompanied by 118 deals. Similarly, Q4 2020 experienced the highest deal count of 144, with $33 billion invested. These peaks reflect heightened demand for communications infrastructure enhancements during the post-COVID recovery period, and government stimuli aimed at modernizing critical networks.
• Beginning mid-2023, deal activity slowed significantly due to tightening credit markets, inflationary pressures, and global geopolitical tensions. By Q3 2024, deal count dropped to its lowest at 64, while investment values were at $30.12 billion. This shift reflects acquirers’ cautious approach and a preference for strengthening internal capabilities over aggressive expansion.
• The stability in capital investment, despite declining transaction volumes, indicates ongoing industry consolidation. Acquirers are targeting assets that offer operational synergies or position them favorably in emerging markets. This trend is further supported by government incentives for digital infrastructure and technological innovation.

• US-based acquirers accounted for 25% of the total capital invested and 27% of the total deal count. This dominance reflects its position as a global hub for security and communications infrastructure, supported by a strong domestic market and significant demand for critical infrastructure modernization. High-value acquisitions were prioritized, driven by technological advancements in 5G networks and cybersecurity solutions.
• The United Kingdom contributed 15% of total capital and 12% of deal count, highlighting its significant role in the European market. Despite having a smaller share of deal activity than the United States, the UK attracted investments focused on strategic infrastructure assets and regional consolidation, showcasing the appeal of its well-established communications ecosystem.
• Italy and Spain captured 10% and 9% of total capital, respectively, while each accounted for 3% and 4% of the deal count, respectively. These markets reflect growing interest in Southern Europe, driven by the need to upgrade aging infrastructure and expand broadband access. Investment patterns suggest a mix of large-scale acquisitions and smaller strategic transactions, underscoring the region’s evolving importance in the sector.
• Germany, representing 5% of capital invested and 4% of deals, emphasized fewer, higher-value transactions. This aligns with its focus on industrial-grade communications infrastructure and a preference for acquisitions that strengthen its manufacturing and logistics networks. Germany’s unique market dynamics support its position as a leader in engineering-driven innovation.
• Countries classified under “Other” collectively made up 21% of total capital and 30% of deal count, reflecting the breadth of international activity in the sector. Smaller markets like India and Czechia saw steady activity, often driven by niche opportunities in emerging markets or regional infrastructure modernization. This trend indicates increasing globalization of the security and communications solutions sector.
• Both Australia and Canada accounted for 3% to 5% of capital and deal activity. Investments in these regions were typically tied to national security upgrades and connectivity in remote areas, underlining their strategic importance in the global landscape.

• Mergers and acquisitions (M&A) accounted for $239 billion in capital across 1,108 transactions, making it the most significant deal type. These transactions reflect the industry’s strategic focus on consolidation, with buyers seeking to expand capabilities and integrate advanced solutions to address the increasing complexity of network management and infrastructure demands. M&A has become a preferred approach for accessing innovative technologies and building stronger competitive positions in key markets.
• Leveraged buyouts (LBOs) captured $157.03 billion over 707 transactions, indicating a focus on acquiring businesses with scalable offerings and the potential for operational growth. These deals highlight investor interest in companies with innovative solutions and a clear path toward delivering value through improved service delivery or market reach.
• Corporate divestitures accounted for $87.38 billion across 120 transactions. These deals often enable companies to reallocate resources to their most critical operations or focus on growth opportunities. For acquirers, divestitures provide access to specialized technologies and tools, creating opportunities to bolster their own market presence or increase operational capabilities.
• There is a focus on strategic integration and innovation on these deals. Buyers are seeking opportunities to adopt innovative platforms that support end-to-end monitoring and automated network orchestration. These investments often focus on increasing multi-vendor management and enabling seamless integration. Technologies that deliver actionable insights for operational efficiency are becoming a key priority, helping companies address the challenges of complex and dynamic environments.

M&A Transactions Case Studies

Case Study 01

PELCO

Transaction Structure

Motorola Solutions acquired Pelco on July 31, 2020, for $110 million in a strategic move to strengthen its video security and analytics portfolio. This acquisition was structured as a complete buyout, integrating Pelco’s assets and operations into Motorola’s existing ecosystem of security solutions.

Market and Customer Segments Combination

The acquisition leveraged Pelco’s leadership in video surveillance technologies, including its expertise in designing and manufacturing high-performance CCTV systems. Motorola’s focus on delivering end-to-end security solutions complemented Pelco’s capabilities, enabling the combined entity to provide comprehensive offerings to critical industries such as public safety, healthcare, and enterprise security. By integrating Pelco’s customer base, Motorola expanded its reach to include industries requiring sophisticated surveillance and analytics, addressing growing demand for real-time monitoring and security intelligence.

Acquisition Strategic Rationale

The acquisition of Pelco was a key element of Motorola’s strategy to strengthen its position in the rapidly growing video security market. Pelco brought advanced camera technologies, scalable surveillance solutions, and an established global footprint, aligning with Motorola’s goal to deliver seamless, integrated security platforms. This acquisition allowed Motorola to capitalize on opportunities in high-growth verticals while reinforcing its competitive edge in video analytics and smart surveillance technologies. By combining Pelco’s innovation with its existing solutions, Motorola further diversified its portfolio and drove value creation through operational synergies and market expansion.

Case Study 02

OPENPATH

Transaction Structure

Motorola Solutions completed the acquisition of Openpath Security on July 15, 2021, for $298 million. This transaction was structured as a full acquisition, integrating Openpath’s operations and solutions into Motorola’s expanding portfolio of security technologies.

Market and Customer Segments Combination

The acquisition combined Openpath’s expertise in cloud-based mobile access control systems with Motorola’s comprehensive suite of security and communication solutions. Openpath’s technology, which enables touchless and secure entry systems for commercial buildings, complemented Motorola’s presence in video security and analytics. By acquiring Openpath, Motorola gained access to a broader customer base, including enterprise clients seeking integrated, user-friendly security solutions for workplace safety and convenience. The combination strengthened Motorola’s position in the commercial security market, catering to the growing demand for innovative, contactless access technologies.

Acquisition Strategic Rationale

Motorola’s acquisition of Openpath supported its strategic objective of delivering seamless, end-to-end security solutions by adding cloud-based access control to its product offerings. Openpath’s innovative platform aligned with the shift toward hybrid work environments, where secure and flexible access solutions are critical. This acquisition enabled Motorola to capitalize on trends in workplace security and scalability, creating synergies with its existing video surveillance and communications infrastructure. By integrating Openpath’s solutions, Motorola increased its ability to provide a unified, cloud-based security ecosystem, driving growth in high-value markets and reinforcing its leadership in the security technology sector.

Case Study 03

INFINERA

Transaction Structure

Nokia announced the acquisition of Infinera on June 27, 2024, for $2.3 billion. This transaction was structured as a strategic acquisition to fully integrate Infinera’s optical networking technology and expertise into Nokia’s communications infrastructure solutions portfolio.

Market and Customer Segments Combination

The acquisition combined Nokia’s strength in telecommunications equipment with Infinera’s leadership in high-capacity optical transport systems. This integration allowed Nokia to broaden its offerings in security and communications infrastructure solutions, particularly for telecom operators and data center providers. Infinera’s customer base in advanced optical networking complemented Nokia’s global presence, positioning the combined entity to address increasing demands for high-performance network infrastructure in key markets such as 5G deployment, broadband expansion, and secure communications networks.

Acquisition Strategic Rationale

Nokia’s acquisition of Infinera aligned with its strategic focus on enhancing its portfolio of security and communications infrastructure solutions. Infinera’s proprietary optical transport technology and innovation in data transmission positioned Nokia to better meet the demands of evolving network environments. This transaction allowed Nokia to deliver scalable, high-capacity solutions for mission-critical applications, including 5G backhaul, secure broadband networks, and data center interconnectivity. The acquisition also created operational synergies, leveraging Nokia’s global market presence to amplify the reach and impact of Infinera’s advanced solutions. This strengthened Nokia’s position as a leader in integrated communications infrastructure solutions.

The security and communications infrastructure solutions sector is undergoing significant transformation, driven by a sharp focus on integrating advanced technologies. Recent M&A transactions highlight the industry’s strategic push to increase automation, interoperability, and real-time monitoring capabilities. As companies consolidate strengths and expand service portfolios to meet growing demands for scalable and secure infrastructure, the sector is poised for further innovation and growth, particularly in high-value markets like critical infrastructure, public safety, and enterprise connectivity. This momentum signals sustained opportunities for strategic investments and operational synergies in the years ahead.

Source: SIS Internacional, Fortune Business Insights, Pitchbook Data.