IT Services/Outsourcing Monthly June 2015

1

IT Services Update

Salient Transactions Major Indices & Exchange Rates

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Quality Technologies Acquires Carpathia Hosting for $326M

• Carpathia provides cloud services and managed hosting for

enterprises and federal agencies worldwide

• Carpathia’s hosting capabilities complement Quality

Technologies’ lead in compliance, cloud and managed services

Jensen Hughes Acquires Erin Engineering for $28M

• The combination of Jensen Hughes and Erin Engineering and

Research creates the nation’s largest provider of specialty

engineering and consulting services, with combined revenues

exceeding $150 million and more than 700 employees

CA Technologies Acquires Rally Software for $467M

• CA Technologies acquired Rally Software, a Colorado-based

provider of agile software development solutions

• Rally’s Agile development software and services complement

CA’s strengths in the areas of DevOps and Management Cloud

• CA Technologies has agreed to pay $19.5 per share, indicating

a premium of 42.9% over the last closing price

Close as of

5/29/2015 1 Month 12 Month

Dow Jones Industrial Average 18,010.68 1.0% 7.7%

NYSE Composite Index 11,056.30 0.1% 2.8%

NASDAQ Composite Index 5,070.03 2.6% 19.5%

AMEX Composite Index 2,429.47 (2.2%) (10.9%)

S&P 500 Index 2,107.39 1.0% 9.6%

Russell 2000 Index 1,246.53 2.2% 9.9%

Euro / USD 0.9112 2.0% 24.3%

Japanese Yen / USD 124.0400 3.6% 21.9%

British Pound / USD 0.6548 0.6% 9.8%

% Change

As of

5/29/2015 1 Month 12 Month

U.S. Prime Rate 3.250% 0.00 0.00

U.S. Treasury - 10 years 2.090% 4.40 (36.70)

ICE LIBOR - USD - 3 Month 0.284% 0.50 5.64

Federal Funds Overnight Rate 0.050% 0.00 0.00

Bps Change

IT Services News Interest Rates

Global CRM Analytics Market to Grow to $7.6B by 2019

The global CRM analytics market is expected to grow from $4.2

billion in 2014 to $7.6 billion by 2019, at an estimated CAGR of

12.8% from 2014 to 2019. Businesses across a broad spectrum of

verticals are starting to widely adopt CRM analytics

Cloud IaaS Market to Reach $16.5B in 2015 at CAGR of 29.1%

Global spending on cloud Infrastructure-as-a-Service (IaaS) is

expected to reach almost $16.5 billion in 2015, an increase of

32.8% from 2014, and further grow at an expected CAGR of 29.1%

from 2014 to 2019, according to Gartner. The market for cloud

IaaS is in a state of upheaval, as many service providers are

shifting their strategies after failing to gain enough market traction.

In 2014, the absolute growth of public cloud IaaS workloads

surpassed the growth of on-premises workloads (of any type) for

the first time

IT Services/Outsourcing Monthly June 2015

2

IT Services Headlines

05/27 The global healthcare BPO market that comprises of F&A BPO, HR BPO and CRM BPO is expected to grow at a

CAGR of 5.3% over the period 2014 to 2019 as per Research and Markets. Increased adoption of cloud technology is

one of the key trends upcoming in this market. Cloud-based BPO in the healthcare sector is revolutionizing the mode

of outsourcing business processes. Cloud-based BPO enables healthcare business processes such as payroll,

finance & accounting, contact centers, and specialized HR solutions. The global healthcare BPO market is primarily

driven by the increased need for cost-effective operations (Research and Markets, 05/27/15).

05/21 Governments in the Middle East and North Africa are expected to spend $12 billion on IT products and services in

2015, an increase of 0.4% over 2014 spending of $11.9 billion, according to Gartner. Telecom services, which include

fixed and mobile telecom services, might be the largest overall spending category throughout the forecast period

within the government sector. It is expected to be $5.2 billion in 2015 – led by growth in mobile network services.

Software spending is expected to grow 6.7% over 2014 spending levels, to reach $1.2 billion (Gartner, 05/21/15).

05/20 The global customer relationship management (CRM) software market totaled $23.2 billion in 2014, up 13.3% from

$20.4 billion in 2013, according to Gartner. Overall, the top 10 CRM vendors accounted for more than a 60% share in

2014, or $14 billion, growing 14% over 2013. The top 10 vendors in 2014 had very little change in ranking compared

with 2013. However, with the notable exceptions of Salesforce and Microsoft, most vendors in the top 10 only held

their positions or they lost share in 2014 (Gartner, 05/20/15).

05/20 The global legal process outsourcing market is expected to grow at a CAGR of 27.4% over the period 2014-2019 as

per ReportsnReports. The legal process outsourcing market involves procuring legal services from an external

service provider. It is considered as a strategic decision taken by the law and corporate firms to outsource these

services as the cost of legal proceeding is rising day by day. Outsourcing of the legal process grants companies easy

access to experienced and fresh talent on legal management while at the same time helps in building the companies'

core competencies (ReportsnReports, 05/20/15).

05/19 The global document outsourcing market is expected to grow at a CAGR of 5.2% over the period 2014-2019 as per

Research and Markets. The global document outsourcing market can be categorized in three segments: on-site

contracted services, statement printing, and document process outsourcing. Cost reduction and employee efficiency

are major focus areas for organizations, but very few institutions conduct the correct assessments to improve the

implementation of workgroup printers and document handling processes (Research and Markets, 05/19/15).

05/19 Enterprises and cloud service providers have made huge strides in virtualizing core sections of their data centers.

Manually configuring the network will soon be a thing of the past as software-defined networking (SDN) gives data

center administrators the tools they need to orchestrate their networking operations and dovetail them with the already

abstracted compute and storage elements. This exciting move is set to be a game-changer, paving the way for

software-defined application services (SDAS), which will bring a new level of network automation, responsiveness and

resource flexibility (IT-Online, 05/19/15).

IT Services/Outsourcing Monthly June 2015

3

IT Services Headlines

05/19 The worldwide Internet of Things (IoT) market is expected to grow 19% in 2015, led by digital signage, according to

IDC. The IoT market in manufacturing operations will grow from $42.2 billion in 2013 to $98.8 billion in 2018, a five-

year CAGR of 18.6%. Growth will be driven by ongoing efforts to increase efficiency and link islands of automation.

Digital signage use in retail outlets will grow from $6.0 billion in 2013 to $27.5 billion in 2018, a 35.7% five-year CAGR,

as retailers continue to digitize the consumer experience. The hottest US market is in connected vehicles, with 34.8%

year-over-year growth anticipated in 2015 (IDC, 05/19/15).

05/19 Outsourcing demand continues to remain sluggish in Q1 of 2015, according to Everest Group, as outsourcing buyers

favored global in-house centers (GICs) and near-shoring, and providers focused on disruptive technologies and public

sector business. Transaction activity continued to decline for the third consecutive quarter, with a 4% decline from Q4

of 2014. Mid-tier service providers, which account for a large share of the outsourcing market, have felt the pinch in

particular, and mega-deals were absent in Q1, resulting in a 50% drop in average contract value. Europe accounts for

one-third of all GIC activity, and new setup activity in Europe surpassed that of Asia for the first time in Q1 2015

(Everest Group, 05/19/15).

05/18 The global testing Platform-as-a-Service (PaaS) market is expected to grow at a CAGR of 30.9% from 2014 to 2019,

as per TechNavio. The testing PaaS model offers a simplified solution for managing issues related to variability,

through a cloud-based platform that helps organizations transfer testing facilities to a third party. Depending on the

end user, the amount of infrastructure used can be increased or decreased for managing the existing system. Testing

PaaS is growing mostly on public cloud as it is a highly scalable, cost-effective model (TechNavio, 05/18/15).

05/18 Australian government ICT spending is expected to growth at 1.7% CAGR from 2012 to 2017. IT investments aiming

to drive consolidation, cost savings and efficiency gains will continue to be the primary focus, but improving service

delivery through third platform investments – particularly analytics and mobility – is of increasing importance. In 2014,

the Australian government’s ICT spending reached $4.6 billion, representing 8.5% of the total ICT spend and is

expected to grow to $4.9 billion by 2018. IT services represents the largest spending category valued at $1.7 billion

but the strongest 5-year CAGR growth is for software at 7.0% (IDC, 05/18/15).

05/15 The global pharmacy information systems market is estimated to grow at a CAGR of 7.7% from 2014 to 2019. In

2014, North America held the largest share of the global pharmacy information systems market, followed by Europe.

The global pharmacy information systems market holds a high potential for growth in future due to a number of factors

favoring this market. These include government and venture capitalist investments, technological advancements, and

increase in the adoption of automation technologies (Research and Markets, 05/15/15).

05/15 Supply chain management (SCM) BPO has become a need for every business to compete in a dynamic market

environment. With advancements in technology and digitization of SCM activities, organizations have started focusing

more on providing enhanced customer value along with improved operational efficiency, quality outcomes and

enhanced outsourcing of operational activities. In addition, the emergence of flexible supply-chain concepts to meet

unexpected consumer demand with multiple transport modes at multiple locations has resulted in increased adoption

of SCM services and solutions (Future Market Insights, 05/15/15).

IT Services/Outsourcing Monthly June 2015

(20%)

(10%)

0%

10%

20%

30%

40%

50%

60%

31-May-14 31-Jul-14 30-Sep-14 30-Nov-14 31-Jan-15 31-Mar-15 31-May-15

S&P 500 Index IT Services - North America IT Services - India IT Services - Europe

BPO Value-Added Resellers ICT Services

Inde

xed

Pric

e (%

)

10.7%9.6%

11.7%

37.6%

3.7%

21.2%25.6%

(10%)

(5%)

0%

5%

10%

15%

20%

25%

31-May-14 31-Jul-14 30-Sep-14 30-Nov-14 31-Jan-15 31-Mar-15 31-May-15

S&P 500 Index Dow Jones Industrial NASDAQ Composite Russell 2000

Inde

xed

Pric

e (%

)

9.6%

7.7%

9.9%

19.5%

4

Industry Fundamentals

IT Services Sector Indices vs. S&P 500 (12 Month Relative Share Price Returns as of May 29, 2015)

Market-Indexed Prices (12 Month Indexed Prices as of May 29, 2015)

Source: Capital IQ IT Services - North America: ACN, GIB.A, CSC, EPAM, VRTU, PRFT, LIOX

IT Services - India: 532540, CTSH, 500209, 507685, 532281, TECHM, IGTE, SYNT, 532819, 532129, 533179, 532400, 504067, 532541

IT Services - Europe: ENXTPA:CAP, ENXTPA:ATO, CATS:IDR, ENXTPA:SOP, HLSE:TIE1V, LXFT, GLOB, OM:ACAN B

Value-Added Resellers: CDW, NSIT, ENXTBR:ECONB, PLUS, PCCC, BIT:SES, SYX, CBR, PCMI

Information and Communication Technology (ICT) Services: LSE:CCC, JSE:DTC, ELNK, BBOX, DTLK

Note: GLOB is excluded from indexed returns data for IT Services - Europe because the stock did not trade publicly until July 2014

Index 1 Month 12 Month

S&P 500 Index 1.0% 9.6%

Dow Jones Industrial 1.0% 7.7%

NASDAQ Composite 2.6% 19.5%

Russell 2000 2.2% 9.9%

Index 1 Month 12 Month

S&P 500 Index 1.0% 9.6%

IT Services - North America 4.4% 25.6%

IT Services - India 5.9% 37.6%

IT Services - Europe (3.9%) 11.7%

BPO 0.3% 10.7%

Value-Added Resellers (4.0%) 3.7%

ICT Services 7.9% 21.2%

IT Services/Outsourcing Monthly June 2015

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

3.5x

4.0x

4.5x

5.0x

31-May-14 31-Jul-14 30-Sep-14 30-Nov-14 31-Jan-15 31-Mar-15 31-May-15

IT Services - North America IT Services - India IT Services - Europe

BPO Value-Added Resellers ICT Services

Ent

erpr

ise

Val

ue /

Rev

enue

1.9x

1.2x

2.8x

1.2x

0.3x0.4x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

31-May-14 31-Jul-14 30-Sep-14 30-Nov-14 31-Jan-15 31-Mar-15 31-May-15

IT Services - North America IT Services - India IT Services - Europe

BPO Value-Added Resellers ICT Services

Ent

erpr

ise

Val

ue/E

BIT

DA

14.6x

10.4x

13.4x

10.2x

6.8x

9.0x

5

Relative Valuation (12 Month EV / Revenue Valuations as of May 29, 2015)

Industry Fundamentals

Relative Valuation (12 Month EV / EBITDA Valuations as of May 29, 2015)

Source: Capital IQ; Note: EV/Revenue and EV/EBITDA multiples higher than 20.0x and 50.0x, respectively, were excluded from chart calculations IT Services - North America: ACN, GIB.A, CSC, EPAM, VRTU, PRFT, LIOX

IT Services - India: 532540, CTSH, 500209, 507685, 532281, TECHM, IGTE, SYNT, 532819, 532129, 533179, 532400, 504067, 532541

IT Services - Europe: ENXTPA:CAP, ENXTPA:ATO, CATS:IDR, ENXTPA:SOP, HLSE:TIE1V, LXFT, GLOB, OM:ACAN B

Value-Added Resellers: CDW, NSIT, ENXTBR:ECONB, PLUS, PCCC, BIT:SES, SYX, CBR, PCMI

ICT Services: LSE:CCC, JSE:DTC, ELNK, BBOX, DTLK

Note: GLOB is excluded from EV/Revenue and EV/EBITDA valuations for IT Services - Europe because the stock did not trade publicly until July 2014

Index Averages 1 Month 12 Month

IT Services - North America 1.9x 1.7x

IT Services - India 2.7x 2.7x

IT Services - Europe 1.2x 1.1x

BPO 1.2x 1.1x

Value-Added Resellers 0.4x 0.3x

ICT Services 0.4x 0.4x

Index Averages 1 Month 12 Month

IT Services - North America 14.3x 12.4x

IT Services - India 12.9x 12.2x

IT Services - Europe 10.6x 10.0x

BPO 10.1x 8.9x

Value-Added Resellers 9.3x 8.1x

ICT Services 6.9x 6.8x

IT Services/Outsourcing Monthly June 2015

6

IT Services Public Trading Statistics (As of May 29, 2015)

Source: Capital IQ; Note: EV/Revenue and EV/EBITDA multiples higher than 20.0x and 50.0x, respectively, were excluded from aggregate calculations and are marked as ‘NM’ IT Services - North America: ACN, GIB.A, CSC, EPAM, VRTU, PRFT, LIOX

IT Services - India: 532540, CTSH, 500209, 507685, 532281, TECHM, IGTE, SYNT, 532819, 532129, 533179, 532400, 504067, 532541

IT Services - Europe: ENXTPA:CAP, ENXTPA:ATO, CATS:IDR, ENXTPA:SOP, HLSE:TIE1V, LXFT, GLOB, OM:ACAN B

Value-Added Resellers: CDW, NSIT, ENXTBR:ECONB, PLUS, PCCC, BIT:SES, SYX, CBR, PCMI

($ in millions except stock price) EV as a multiple of LTM

Current 52 Week % of 52 Market Enterprise LTM LTM NTM Total Rev

Company Price High Week High Cap Value Revenue EBITDA % Margin Revenue EBITDA Revenue EBITDA Growth

IT Services - North America

Accenture plc $96.04 $97.95 98.1% $60,146 $56,668 $30,902 $4,893 15.8% 1.8x 11.6x 1.8x 11.1x 7.4%

CGI Group, Inc. 42.14 46.15 91.3% 13,203 14,731 8,129 1,370 16.9% 1.8x 10.8x 1.8x 9.6x (0.8%)

Computer Sciences Corporation 68.60 73.29 93.6% 9,520 10,091 12,173 1,299 10.7% 0.8x 7.8x 0.9x 4.8x (6.3%)

EPAM Systems, Inc. 71.91 73.11 98.4% 3,517 3,294 770 116 15.1% 4.3x 28.3x 3.5x 19.2x 30.2%

Virtusa Corp. 45.50 46.30 98.3% 1,349 1,134 479 65 13.6% 2.4x 17.4x 2.0x 14.3x 20.7%

Perficient Inc. 18.92 21.57 87.7% 670 732 453 60 13.3% 1.6x 12.1x 1.5x 8.5x 22.8%

Lionbridge Technologies Inc. 5.52 6.19 89.2% 357 424 507 30 5.9% 0.8x 14.3x 0.7x 7.2x 2.3%

Mean $49.80 $52.08 93.8% $12,680 $12,439 $7,630 $1,119 13.0% 1.9x 14.6x 1.7x 10.7x 10.9%

Median $45.50 $46.30 93.6% $3,517 $3,294 $770 $116 13.6% 1.8x 12.1x 1.8x 9.6x 7.4%

IT Services - India

Tata Consultancy Services Limited $40.90 $44.50 91.9% $80,114 $77,205 $15,140 $3,916 25.9% 5.1x 19.7x 4.6x 16.0x 15.7%

Cognizant Technology Solutions 64.72 65.58 98.7% 39,513 37,238 10,752 2,162 20.1% 3.5x 17.2x 2.9x 14.7x 16.3%

Infosys Ltd. 31.70 36.60 86.6% 36,228 31,331 8,711 2,476 28.4% 3.6x 12.7x 3.4x 12.3x 5.6%

HCL Technologies Ltd. 15.84 16.58 95.5% 22,265 20,996 5,822 1,438 24.7% 3.6x 14.6x 3.3x 14.3x 12.4%

Wipro Ltd. 8.80 10.61 83.0% 21,597 18,914 7,511 1,673 22.3% 2.5x 11.3x 2.4x 10.5x 8.1%

Tech Mahindra Limited 8.69 11.73 74.0% 8,351 7,979 3,619 664 18.4% 2.2x 12.0x 1.9x 10.6x 20.1%

iGATE Corporation 47.51 47.95 99.1% 3,845 4,368 1,288 249 19.3% 3.4x 17.6x 3.1x 14.0x 9.3%

Syntel, Inc. 47.51 52.99 89.7% 3,979 3,249 913 254 27.9% 3.6x 12.8x 3.2x 10.5x 6.7%

MindTree Limited 22.74 24.90 91.3% 1,905 1,760 567 111 19.5% 3.1x 15.9x 2.7x 13.7x 17.4%

Hexaware Technologies Limited 4.41 5.26 83.8% 1,328 1,254 433 78 18.0% 2.9x 16.1x 2.6x 13.8x 14.4%

Persistent Systems Limited 12.33 15.06 81.9% 986 892 303 57 19.0% 2.9x 15.5x 2.6x 11.9x 13.3%

Zensar Technologies Limited 12.04 12.35 97.5% 534 504 420 60 14.2% 1.2x 8.4x 1.1x 7.1x 13.4%

NIIT Technologies Limited 6.00 7.62 78.8% 366 319 380 44 11.7% 0.8x 7.2x 0.8x 5.0x 2.9%

KPIT Technologies Limited 1.63 3.65 44.7% 307 310 478 44 9.2% 0.6x 7.1x 0.6x 5.4x 11.0%

Mean $23.20 $25.38 85.5% $15,808 $14,737 $4,024 $945 19.9% 2.8x 13.4x 2.5x 11.4x 11.9%

Median $14.08 $15.82 88.1% $3,912 $3,808 $1,100 $252 19.4% 3.0x 13.7x 2.7x 12.1x 12.8%

IT Services - Europe

Cap Gemini S.A. $86.73 $94.13 92.1% $14,201 $12,995 $12,798 $1,312 10.3% 1.0x 9.9x 1.0x 9.3x 4.8%

Atos SE 76.86 80.80 95.1% 8,863 8,007 10,956 1,242 11.3% 0.7x 6.4x 0.7x 5.9x 5.1%

Indra Sistemas, S.A. 9.68 15.20 63.7% 1,587 2,415 3,247 (6) NM 0.7x NM 0.7x 9.0x 1.1%

Sopra Steria Group 87.71 96.03 91.3% 1,787 2,307 2,760 248 9.0% 0.8x 9.3x 0.6x 8.3x 69.0%

Luxoft Holding, Inc. 53.53 57.30 93.4% 1,759 1,714 521 94 18.0% 3.3x 18.3x 2.6x 14.2x 30.7%

Tieto Oyj 22.87 26.32 86.9% 1,680 1,598 1,613 171 10.6% 1.0x 9.3x 1.0x 7.1x (4.4%)

Globant S.A. 26.04 26.66 97.7% 880 811 211 29 14.0% 3.8x 27.5x 3.1x 18.6x 26.3%

Acando AB (publ.) 1.56 1.84 84.7% 160 159 233 17 7.4% 0.7x 9.2x NM NM 36.5%

Mean $45.62 $49.79 88.1% $3,865 $3,751 $4,042 $388 11.5% 1.5x 12.9x 1.4x 10.3x 21.1%

Median $39.79 $41.98 91.7% $1,719 $2,011 $2,186 $133 10.6% 0.9x 9.3x 1.0x 9.0x 15.7%

Value-Added Resellers

CDW Corporation $37.10 $39.32 94.4% $6,330 $9,378 $12,177 $897 7.4% 0.8x 10.5x 0.7x 9.3x 10.6%

Insight Enterprises Inc. 29.33 31.94 91.8% 1,137 1,193 5,321 180 3.4% 0.2x 6.6x 0.2x 6.1x 2.8%

Econocom Group SA/NV 8.60 9.20 93.6% 956 1,149 2,533 127 5.0% 0.5x 9.0x 0.5x 8.7x 18.4%

ePlus inc. 77.65 91.38 85.0% 574 654 1,143 87 7.6% 0.6x 7.5x 0.5x 7.0x 8.1%

PC Connection, Inc. 24.92 29.50 84.5% 657 577 2,485 82 3.3% 0.2x 7.0x 0.2x 6.9x 9.2%

SeSa S.p.A. 17.01 19.06 89.2% 273 328 1,150 51 4.5% 0.3x 6.4x NM 5.2x 13.2%

Ciber, Inc. 3.36 5.09 66.0% 265 268 848 21 2.5% 0.3x 12.6x 0.3x 7.0x (3.2%)

PCM, Inc. 9.69 11.82 82.0% 117 198 1,327 16 1.2% 0.1x 12.2x 0.1x 4.6x (2.6%)

Systemax Inc. 8.35 16.43 50.8% 307 178 3,355 (1) NM 0.1x NM 0.1x NM 0.3%

Mean $24.00 $28.19 81.9% $1,179 $1,547 $3,371 $162 4.4% 0.3x 9.0x 0.3x 6.9x 6.3%

Median $17.01 $19.06 85.0% $574 $577 $2,485 $82 3.9% 0.3x 8.3x 0.3x 6.9x 8.1%

IT Services/Outsourcing Monthly June 2015

7

IT Services Public Trading Statistics (As of May 29, 2015)

($ in millions except stock price) EV as a multiple of LTM

Current 52 Week % of 52 Market Enterprise LTM LTM NTM Total Rev

Company Price High Week High Cap Value Revenue EBITDA % Margin Revenue EBITDA Revenue EBITDA Growth

Source: Capital IQ; Note: EV/Revenue and EV/EBITDA multiples higher than 20.0x and 50.0x, respectively, were excluded from aggregate calculations and are marked as ‘NM’ BPO: XRX, G, ENXTPA:RCF, CVG, TTEC, WNS, EXLS, CSGS, 526299, SYKE, TSE:9715, 532809, SRT, ASX:SLM

ICT Services: LSE:CCC, JSE:DTC, ELNK, BBOX, DTLK

BPO

Xerox Corporation $11.42 $14.36 79.5% $12,607 $19,720 $19,238 $2,370 12.3% 1.0x 8.3x 1.1x 8.1x (1.8%)

Genpact Limited 22.49 23.82 94.4% 4,921 5,275 2,338 374 16.0% 2.3x 14.1x NM 12.3x 8.4%

Teleperformance S.A. 73.60 77.92 94.5% 4,205 4,661 3,338 428 12.8% 1.4x 10.9x 1.3x 8.8x 13.4%

Convergys Corporation 24.83 25.00 99.3% 2,454 2,606 2,990 374 12.5% 0.9x 7.0x 0.9x 6.7x 38.5%

TeleTech Holdings Inc. 25.42 29.97 84.8% 1,231 1,304 1,265 161 12.7% 1.0x 8.1x 1.0x 7.5x 4.8%

WNS (Holdings) Ltd. 26.39 27.99 94.3% 1,371 1,231 534 102 19.1% 2.3x 12.0x 2.3x 10.7x 6.2%

CSG Systems International Inc. 31.19 31.38 99.4% 1,066 1,182 749 122 16.3% 1.6x 9.7x 1.5x 7.0x (0.8%)

Exlservice Holdings, Inc. 35.90 39.36 91.2% 1,195 1,111 521 61 11.7% 2.1x 18.2x 1.8x 10.3x 7.6%

Sykes Enterprises, Incorporated 24.23 26.04 93.0% 1,049 909 1,327 146 11.0% 0.7x 6.2x 0.7x 6.5x 3.1%

MphasiS Limited 5.81 7.47 77.9% 1,222 896 927 139 15.0% 1.0x 6.4x 1.0x 6.1x (6.9%)

Trans Cosmos, Inc. 23.60 24.39 96.8% 971 734 1,660 93 5.6% 0.4x 7.9x NM NM 6.8%

Firstsource Solutions Limited 0.48 0.69 69.8% 323 414 480 60 12.5% 0.9x 6.9x 0.8x 5.9x (3.3%)

StarTek, Inc. 6.35 10.12 62.7% 99 112 251 8 3.4% 0.4x 13.3x 0.4x 11.0x 4.1%

Salmat Limited 0.60 1.53 39.0% 95 86 388 6 1.6% 0.2x 13.6x 0.2x 6.4x 3.9%

Mean $22.31 $24.29 84.0% $2,343 $2,874 $2,572 $318 11.6% 1.2x 10.2x 1.1x 8.2x 6.0%

Median $23.91 $24.69 92.1% $1,209 $1,146 $1,096 $131 12.5% 1.0x 9.0x 1.0x 7.5x 4.5%

ICT Services

Datatec Limited $5.48 $5.59 98.0% $1,115 $1,239 $6,444 $199 3.1% 0.2x 6.2x 0.2x 5.4x 13.3%

EarthLink Holdings Corp. 6.94 7.06 98.4% 715 1,194 1,162 213 18.3% 1.0x 5.6x 1.1x 5.5x (4.8%)

ComputaCenter plc 11.11 12.26 90.7% 1,339 1,157 4,843 166 3.4% 0.2x 7.0x 0.2x 6.4x 1.2%

Black Box Corporation 20.06 25.30 79.3% 308 423 992 53 5.3% 0.4x 8.0x 0.4x 7.1x 2.1%

Datalink Corporation 9.24 13.74 67.2% 215 197 666 28 4.2% 0.3x 7.0x 0.3x NM 11.0%

Mean $10.57 $12.79 86.7% $739 $842 $2,821 $132 6.9% 0.4x 6.8x 0.4x 6.1x 4.5%

Median $9.24 $12.26 90.7% $715 $1,157 $1,162 $166 4.2% 0.3x 7.0x 0.3x 6.0x 2.1%

IT Services/Outsourcing Monthly June 2015

8

Source: Company Filings, Press Releases, Thomson Reuters, Capital IQ, Analyst Reports

Note: April 2015 reports a spike in transaction value due to a pending $16.6B deal of Nokia-Alcatel and $57.5B deal of SK C&C –SK Holdings

Commentary

Global Technology Monthly Transactions Count and Volumes (Last One Year as of April 30, 2015)

Global M&A transaction value in Software and Services rose to $111.5 billion in April 2015, from a low of $8.9 billion in January

2015. The total number of M&A transactions rose 10.0% year-on-year to 539 from 490 transactions in April 2014. The total

number of private placement deals (813) was higher than the number of M&A deals (539) this month. Global M&A transaction

value rose in 2014 to $363.0 billion, marking a 43.8% increase year-on-year, while the total number of M&A deals rose by 17.5%

to 5,899 in the same period. The total number of private placement deals rose to 9,118 in 2014, marking an increase of 14.2%

year-on-year. 2014 recorded the highest number of both M&A and private placement transactions in the past 8 years. Improving

economic conditions in the U.S., low interest rates, and strong cash balances in technology firms indicate a bright outlook for Q2

2015

490 508 512 527

429

537577

459

511 494 477

559 539

776 792 773 767797 809

852

686

809

723768

901

813

$11.8 $23.4$28.6

$21.1 $35.6 $36.5$18.5

$22.5 $22.0

$8.9

$28.3 $25.5

$111.5

$0

$20

$40

$60

$80

$100

$120

0

100

200

300

400

500

600

700

800

900

1000

Apr

-14

May

-14

Jun-

14

Jul-1

4

Aug

-14

Sep

-14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb

-15

Mar

-15

Apr

-15

M&

A T

ransaction Volum

e ($ in billions)C

ount

of T

rans

actio

ns

Merger/Acquisition Private Placement M&A Transaction Volume

Global Technology Annual Transactions Count and Volumes (Last Eight Years as of December 31, 2014)

Global Technology Sector M&A and Private Placement Update (As of April 30, 2015)

5,663

4,929

3,754

4,992 5,345 5,229 5,019

5,899

3,788

3,660 4,118

5,494

6,818 7,354

7,984

9,118

$390.8

$245.9$206.2 $220.2

$270.6$232.6 $252.5

$363.0

$0

$100

$200

$300

$400

$500

$600

$700

$800

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2007 2008 2009 2010 2011 2012 2013 2014

M&

A T

ransaction Volum

e ($ in billions)C

ount

of T

rans

actio

ns

Merger/Acquisition Private Placement Merger/Acquisition

IT Services/Outsourcing Monthly June 2015

9

Source: Company Filings, Press Releases, Capital IQ, Research Reports

Select Recently Announced M&A Transactions (As of May 29, 2015)

($ in millions)

Announced Date Acquirer Target Target Business Description

Enterprise

Value

EV /

Revenue

EV /

EBITDA

5/27/2015 CA, Inc. Rally Softw are Development Corp.Provides cloud-based solutions for the management of Agile softw are

development w orldw ide$467.0 5.3x NM

5/25/2015 Talan SAS Solog SAProvides IT services in Geneva and partners w ith Microsoft for solutions

integration and implementationNA NA NA

5/22/2015 Sotreq S.A.Radix Engenharia e Desenvolvimento de

Softw are Ltda.Provides IT services in Brazil NA NA NA

5/20/2015 ConvergeOne, LLC MSN Communications, Inc.Doing business as Mountain States Netw orking, is a Cisco Gold Certif ied

Partner, and provides netw ork solutions in the w estern U.S.NA NA NA

5/20/2015 ConvergeOne, LLC Sunturn, Inc.An Avaya Platinum Partner, designs and delivers unif ied communications,

collaboration and contact center solutions to mid-market businesses NA NA NA

5/19/2015 SGS SA SVA Ltd.Provides a range of advisory, testing, and IT solutions to the food and consumer

products industryNA NA NA

5/19/2015 Timico Technology Group Limited Wirebird Limited Provides IT and communications services NA NA NA

5/15/2015 Works Applications Co., Ltd. IVTL Infoview Technologies Pvt Ltd Provides IT consulting services and develops softw are NA NA NA

5/12/2015 All Covered, Inc. Techcess Group, LP Provides IT services for small to medium sized businesses in the U.S. NA NA NA

5/12/2015 iCitizen Corporation Govgraph, LLC Provides data analytics services on government data NA NA NA

5/12/2015 TekLinks, Inc. Claris Netw orks, LLCProvides cloud computing, offsite backup, hosting, and managed services to

businesses in East TennesseeNA NA NA

5/8/2015 Mastech, Inc. Hudson Global Resources Management, Inc.Represents the Pittsburgh, PA based U.S. IT staff ing business for Hudson

Global17.0 NA NA

5/11/2015 SWK Technologies, Inc. ProductiveTech, Inc.Provides computer services, IT support, remote backup, and outsourced IT

services to business in Pennsylvania, New Jersey, and Delaw areNA NA NA

5/8/2015 Enghouse Systems Limited Reitek S.p.A.Provides omni-channel contact center solutions for enterprises of all sizes

including multinational corporations5.1 NA NA

5/7/2015 Allgeier Experts SE netw orker, projektberatung GmbH Provides IT consulting services NA NA NA

5/6/2015 Oxygen Business Solutions Pty Limited Contiigo Pty Ltd. Provides system integration services NA NA NA

5/6/2015 Quality Technology Services Holding, LLC Carpathia Hosting, Inc.Provides cloud services and managed hosting for enterprises and federal

agencies w orldw ide326.0 NA NA

5/5/2015 JENSEN HUGHES, Inc. Erin Engineering And Research, Inc Provides engineering consulting and application softw are services 27.5 0.9x NA

5/5/2015 Information Innovators Inc. Creative Computing Solutions, Inc.Provides integrated program/project management and IT solutions primarily to

the federal government in the U.S.NA NA NA

5/5/2015 NIIT Technologies Limited Incessant Technologies Pvt Ltd. Offers business process management and IT consulting services NA NA NA

5/5/2015 The Carlyle Group LP Telvent Global Services, S.A. Provides IT consulting services NA NA NA

5/4/2015 Coresec Systems AB I Secure Sw eden AB Offers IT security services NA NA NA

5/4/2015 Integrated Research Limited Interactive Quality Services, Inc.Provides monitoring and testing services for contact centers and communication

technologies5.0 NA NA

5/4/2015 WHEB Partners oxaion ag Operates as an IT partner and enterprise resource planning (ERP) provider NA NA NA

5/1/2015 MC Data Plus Mitsubishi Corporation, Kensetsu ASP Division Comprises cloud based application services business NA NA NA

5/1/2015 Sirius Computer Solutions, Inc. Varrow , Inc. Offers IT consulting and designing services NA NA NA

5/1/2015 Pixius Communications, LLC Low en ITProvides IT services, netw ork management, computer repair, and technology

consultation for businesses in KansasNA NA NA

4/30/2015 SQS Softw are Quality Systems AG Trissential, LLCOffers strategic planning, project management, and application development

services to Fortune 100 companies, universities, and mid-sized businesses30.9 1.0x NA

4/28/2015 SolarWinds, Inc. Papertrail Inc. Provides hosted log management solutions 41.1 NA NA

4/28/2015 ManTech International Corporation Welkin Associates Ltd.Delivers mission-centric services in high-end systems engineering and

advanced national security technology and business services34.0 NA NA

4/25/2015 Capgemini North America, Inc. iGATE CorporationProvides IT and IT-enabled operations offshore outsourcing solutions and

services to large and medium-size organizations4,431.1 3.5x 17.4x

4/24/2015 TMC Technologies, Inc. createTank LLC, Federal Division Provides IT consulting services to federal agencies NA NA NA

4/24/2015 Infosys Ltd. Skava, Inc. (Kallidus)Develops and provides mobile and social media technology and services to

retailers and brands in San Francisco, California; and India120.0 NA NA

4/24/2015 Patriot Risk Services, Inc. Corporate Claims Management, Inc.Provides custom-tailored claims administration services and risk management

information systems to the risk management community9.0 1.4x NA

IT Services/Outsourcing Monthly June 2015

10

Source: Company Filings, Press Releases, Capital IQ, Research Reports

($ in millions)

Announced Company Name Country Amount

Type of Financing

/ Round (if VC) Business Description Participated Investors in Current Round

5/25/2015Unisplendour Corporation

LimitedChina $3,629.0 Undisclosed Engages in IT and communications businesses in China Undisclosed

5/21/2015 RightPoint Consulting LLC U.S. 55.0 Undisclosed Operates as a business and technology consulting company Stella Point Capital, LLC

5/20/2015 Samanage Ltd. U.S. 16.0 Series BProvides a cloud-based IT service desk and asset management solution

for private companies operating in the cloud market

Gemini Israel Funds; Carmel Ventures; Vintage Investment

Partners; SVB Silicon Valley Bank, Investment Arm; Marker

5/19/2015Hakim Information

Technology Co.,Ltd.China 386.7 Undisclosed Provides IT services Undisclosed

5/19/2015 Guomai Technologies, Inc. China 246.1 Undisclosed Provides telecommunications outsourcing services in China Undisclosed

5/8/2015Digital China Information

Service Company Ltd.China 580.8 Undisclosed

Provides application softw are, systems integration, integration of

f inancial self-service equipment, and other IT services in ChinaDigital China Softw are Limited

5/7/2015 Intradiem, Inc. U.S. Undisclosed UndisclosedProvides intraday automation solutions for multi-channel contact

centersJMI Equity; MK Capital

5/6/2015Hunan ChangXin

ChangZhong TechnologyChina 34.6 Undisclosed

Engages in the development and sales of computer softw are, system

integration and related technical services

Hubei Kaile Science and Technology Co., Ltd.

(SHSE:600260)

5/6/2015Beijing Changhang

Information TechnologyChina 100.0 Series C

Offers Didapinche, a mobile peer-to-peer (P2P) carpooling service

application that automatically matches and sends push notif ications

IDG Capital Partners; China Renaissance Capital Investment;

Bitauto Holdings Limited; TrustBridge Partners

5/5/2015Shenzhen Sunline Tech Co.,

Ltd.China 18.8 Undisclosed Provides f inancial IT services for banks in China Undisclosed

5/5/2015SAB Ingenierie Informatique

SAFrance 11.2 Undisclosed

Designs, develops, installs, integrates, and maintains banking and

f inancial IT solutionsInternational Finance Corporation

5/4/2015 SkyKick, Inc. U.S. 10.0 UndisclosedDesigns and develops cloud-based migration project solution to help IT

consultants, system integrators, and other IT partners Undisclosed

5/4/2015 Sayers Group, LLC U.S. Undisclosed Undisclosed Provides IT services to organizations Virgo Capital

5/4/2015 Ameritas Technologies Corp U.S. Undisclosed Undisclosed Provides outsourcing services for mission-critical IT projects Moneta Ventures LP

4/22/2015Jiangsu Hoperun Softw are

Co.,Ltd.China 88.7 Undisclosed Provides softw are outsourcing services in China and internationally Undisclosed

4/20/2015 Simeio Solutions LLC U.S. Undisclosed Undisclosed Offers enterprise identity and access management solutions Welsh, Carson, Anderson & Stow e

4/20/2015 Freshdesk, Inc. U.S. 50.0 Series EProvides on-demand customer support softw are that combines back-

end help desk w ith a community management platform

Accel Partners; Tiger Global Management LLC; Google

Capital; Google Capital

4/17/2015 Flashpoint Global Partners U.S. 5.0 Series AProvides softw are and data services to enhance cyber and physical

security of companies, governments, and consumers

Greycroft Partners LLC; Cisco Investments; TechOperators

LLC; K2 Intelligence, LLC; Bloomberg Beta L.P.

4/16/2015 Appirio, Inc. U.S. 35.0 Series EOffers consulting services through its cloud enablement suite and

crow dsourcing community to implement, manage, & measure initiativesFidelity Management & Research Company

4/13/2015 Beers Enterprises, Inc. U.S. 14.5 UndisclosedProvides video sw itching and local f iber circuit services in the U.S., the

United Kingdom, and CanadaUndisclosed

4/9/2015UCloud Information

Technology Co., Ltd.China 100.0 Series C

Provides cloud storage and data analytics services to online gaming

and e-commerce operatorsDCM; Legend Capital; Bertelsmann Asia Investments

4/7/2015Hangzhou Liaison Interactive

Information Technology China 954.4 Undisclosed Develops and sells mobile Internet products and services in China Undisclosed

4/7/2015 Credif i Corp U.S. 8.0 UndisclosedProvides data and risk analytics services for commercial real estate

marketUndisclosed

4/6/2015 ADEXUS S.A. Chile 15.0 Undisclosed Provides system integration and e-commerce solutions GMD S.A.

4/6/2015 Emtec, Inc. U.S. Undisclosed UndisclosedProvides IT services, including consulting, packaged application, cloud

technologies, application outsourcing, and infrastructure services

New Spring Capital; Star Mountain Capital, LLC; MB Financial

Bank, Investment Arm

4/1/2015 Denovo Ventures, LLC U.S. Undisclosed Undisclosed Provides cloud computing and consulting services M/C Partners

3/31/2015Shanghai Cheshui Malong

Information TechnologyChina 6.5 Undisclosed

Operates and manages online e-commerce application and platform for

post-sales automobile servicesDaoming Optics and Chemical Co., Ltd. (SZSE:002632)

3/31/2015 Wonders Information Co., Ltd China 564.6 UndisclosedProvides urban information softw are and services, such as application

softw are development, and softw are and hardw are system integration

Taiping Asset Management Company; Dacheng Fund

Management Company; Pacif ic Asset Management

3/31/2015 ECS Federal, Inc. U.S. Undisclosed Undisclosed Provides system engineering and IT services and solutions to U.S. Lindsay Goldberg

3/30/2015Beijing Changhang

Information TechnologyChina 20.0 Series B

Offers Didapinche, a mobile peer-to-peer (P2P) carpooling service

application that automatically matches and sends push notif icationsBitauto Holdings Limited (NYSE:BITA)

3/30/2015 Skeed Co., Ltd. Japan Undisclosed Undisclosed Provides content delivery service using peer-to-peer (P2P) technology Cresco, Ltd. (TSE:4674)

3/27/2015 Siphon Netw orks Ltd. U.K. Undisclosed UndisclosedEngages in the design, supply, delivery, and integration of voice and

unif ied communications technology productsFinance Wales plc

3/27/2015 Mic.9 Co., Ltd. Japan Undisclosed Undisclosed Provides solutions for various business opportunities in e-commerce Adventure Inc. (TSE:6030)

3/26/2015 QuickPlay Media Inc. Canada 45.7 UndisclosedProvides cloud-based managed service solutions for the distribution of

premium media to IP-connected devices

Madison Dearborn Partners, LLC; Difference Capital Financial

Inc. (TSX:DCF); ORIX Ventures

Select Recently Announced Financings (As of May 29, 2015)

IT Services/Outsourcing Monthly June 2015

11

Source: Company Filings, Press Releases, Capital IQ, Research Reports

Note: The offer price for Armarda Group Limited’s follow-on offering, which closed on 2/17/2015, was $0.00369 per share

Select Recently Announced Equity Offerings (As of May 29, 2015)

Filing Date Closed Date Issuer Ticker Type Securities Offered

Offer Size

('000) Offer Price

Deal Value

($ in millions)

Market Value

($ in millions)

EV /

Revenue

EV /

EBITDA

5/18/2015 5/19/2015 CDW Corporation CDW Follow -on Common Stock 10.00 $36.80 $368.0 $6,304.2 0.8x 10.4x

5/7/2015 5/7/2015 1Spatial Plc SPA Follow -on Common Stock 74.40 0.09 6.8 67.0 1.7x NM

5/3/2015 5/12/2015 Chinasoft International Ltd. 354 Follow -on Common Stock 50.00 0.47 23.7 1,333.1 1.5x 16.4x

4/10/2015 4/13/2015 Osangjaiel Co., Ltd. A053980 Follow -on Common Stock 0.81 13.54 10.9 381.8 4.8x NM

3/19/2015 4/23/2015 DGB Asia Berhad DGB Follow -on Common Stock 326.00 0.03 9.9 3.9 2.0x NM

3/12/2015 3/26/2015 Globant S.A. GLOB Follow -on Common Stock 3.91 18.50 64.3 730.0 2.8x 19.8x

3/10/2015 3/17/2015 ICO Group Limited 8140 IPO Common Stock 250.00 0.05 12.2 559.6 2.0x 49.3x

3/3/2015 3/23/2015 ISB Corporation 9702 Follow -on Common Stock 1.13 8.11 8.0 39.3 0.2x 7.0x

2/23/2015 3/6/2015 NNIT A/S NNIT IPO Common Stock 10.00 18.23 182.3 561.0 1.2x 8.0x

1/27/2015 2/17/2015 Armarda Group Limited 5EK Follow -on Common Stock 2,121.29 0.00 7.8 22.3 19.4x NM

1/16/2015 1/30/2015 Global Strategic Group Limited 8007 Follow -on Common Stock 360.00 0.05 16.4 403.5 376.8x NM

1/2/2015 1/13/2015Shougang Concord Technology

Holdings Limited521 Follow -on Common Stock 240.00 0.03 7.8 132.1 8.9x 35.1x

12/3/2014 1/26/2015 Systems Limited SYS IPO Common Stock 9.75 0.40 5.1 46.1 2.1x 10.2x

12/2/2014 12/2/2014 CDW Corporation CDW Follow -on Common Stock 17.25 33.28 499.2 6,156.6 0.8x 10.3x

11/28/2014 1/11/2015Digital China Information Service

Company Ltd.000555 Follow -on Common Stock 7.17 5.31 38.1 6,905.2 2.1x NM

11/28/2014 12/8/2014 SinoCom Softw are Group Limited 299 Follow -on Common Stock 200.00 0.09 18.1 235.7 0.6x 5.7x

11/28/2014 11/28/2014 Rhype Limited (nka:Rhipe Limited) RHP Follow -on Common Stock 20.00 0.85 21.3 102.0 1.6x NM

10/28/2014 11/13/2014 DigitalHongKong.com 8007 Follow -on Common Stock 30.00 0.19 5.8 77.5 71.9x NM

10/22/2014 10/23/2014 WidePoint Corp. WYY Follow -on Common Stock 6.90 1.45 10.0 124.6 2.6x NM

10/21/2014 12/17/2014 Enterprise Development Holdings Limited 1808 Follow -on Common Stock 350.00 0.03 11.3 56.0 1.3x 7.4x

10/8/2014 11/12/2014 SHIFT, Inc. 3697 IPO Common Stock 0.52 11.28 5.9 163.6 1.3x 22.6x

9/30/2014 12/22/2014 Gijima Group Limited GIJ Follow -on Common Stock 232.99 0.01 8.7 1.5 0.1x NM

9/30/2014 11/11/2014 Samsung SDS Co., Ltd. A018260 Follow -on Common Stock 6.10 173.24 1,056.7 29,828.4 1.7x 13.8x

9/30/2014 11/6/2014 United Electronics Co., Ltd. 002642 Follow -on Common Stock 7.00 4.67 32.7 2,340.9 8.1x NM

9/15/2014 9/16/2014 United Internet AG UTDI Follow -on Common Stock 11.00 41.41 455.5 8,154.8 2.3x 14.4x

9/12/2014 9/12/2014 Empired Limited EPD Follow -on Common Stock 14.00 0.68 9.5 71.0 1.3x 20.1x

9/2/2014 9/3/2014 CDW Corporation CDW Follow -on Common Stock 15.00 31.95 479.3 5,248.0 0.8x 11.5x

7/28/2014 9/26/2014 Shanghai Hyron Softw are Co., Ltd. 002195 Follow -on Common Stock 59.02 13.42 791.9 2,456.7 66.6x NM

7/25/2014 9/8/2014 Jiangsu Hoperun Softw are Co.,Ltd. 300339 Follow -on Common Stock 17.38 2.25 39.1 1,046.1 7.0x NM

7/21/2014 9/16/2014Raya Holding Company for Technology

and Communication (S.A.E)RAYA Follow -on Common Stock 9.42 0.70 6.6 69.7 0.4x 7.1x

7/11/2014 8/12/2014 JK Tech Holdings Limited 5TS Follow -on Common Stock 150.00 0.32 48.0 48.6 1.6x NM

7/10/2014 9/1/2014 Beijing Lanxum Technology Co., Ltd. 300010 Follow -on Common Stock 9.59 2.26 21.7 969.8 5.4x 33.3x

6/19/2014 7/25/2014 Armarda Group Limited 5EK Follow -on Common Stock 1,440.00 0.01 9.3 12.3 11.0x NM

6/17/2014 6/17/2014 FDM Group (Holdings) PLC FDM IPO Common Stock 84.56 4.87 411.7 618.5 3.0x 13.8x

IT Services/Outsourcing Monthly June 2015

12

Source: Company Filings, Press Releases, Capital IQ, Research Reports

Select Recently Closed High Yield (As of May 29, 2015)

Closed Date Issuer Ticker

Amount

($ in millions) Type Security Coupon (%) Maturity Structure

Issuance

Price Yield Spread

Rating

Moody's S&P

2/26/2015 CDW Corporation CDW $525.0 144A Sr. Notes 5.000% 1-Sep-23 NC3 100.000% 5.000% 309 bp B1 B+

1/30/2015 Presidio Holdings 250.0 144A Sr. Notes 10.250% 15-Feb-23 NC3 91.250% 11.973% 1,043 bp Caa1 CCC+

1/30/2015 Presidio Holdings 250.0 144A Sr. Notes 10.250% 15-Feb-23 NC3 91.250% 11.973% 1,043 bp Caa1 CCC+

1/30/2015 Presidio Holdings 150.0 144A Sr. Sub. Notes 10.250% 15-Feb-23 NC3 80.000% 14.638% 1,310 bp NR NR

1/12/2015 Open Text Corporation OTEX 800.0 144A Sr. Notes 5.625% 15-Jan-23 NC3 100.000% 5.625% 381 bp Ba2 BB

7/31/2014 CDW Corporation CDW 600.0 144A Sr. Notes 6.000% 15-Aug-22 NC3 100.000% 6.000% 363 bp B3 B

5/9/2014 Kratos Defense & Security Solutions KTOS 625.0 144A Sr. Sec. Notes 7.000% 15-May-19 NC2 98.966% 7.250% 563 bp B3 B

3/26/2014 SunGard Availability Services LP 425.0 144A Sr. Notes 8.750% 1-Apr-22 NC5 100.000% 8.750% 622 bp Caa1 B-

3/19/2014 iGATE Corporation IGTE 325.0 144A Sr. Notes 4.750% 15-Apr-19 NC2 100.000% 4.750% 319 bp B1 BB-

5/9/2013 Rolta LLC 500366 200.0 144A Sr. Notes 10.750% 16-May-18 5nc3 99.527% 10.874% NA NA BB-

IT Services/Outsourcing Monthly June 2015

13

Source: Company Filings, Press Releases, Capital IQ, Research Reports

($ in millions)

Closed Date Borrower Ticker Total Facility Revolver

Term

Loan Security

Tenor

(Months) Spread

Rating

Moody's

Rating

S&P Purpose Sponsor

5/26/2015 Merrill Communications LLC $560.0 $50.0 $510.0 475 NA B2 BB- General Purpose

5/6/2015 Warehouse LLC 1,016.0 550.0 466.0 425 NA NR NR Project Finance

5/4/2015Science Applications

International CorpSAIC 870.0 200.0 670.0 300 329 bp Ba2 BB Takeover

4/30/2015 Hew lett-Packard Co HPQ 5,000.0 - 5,000.0 100 NA NR NR General Purpose

4/23/2015Science Applications

International CorpSAIC 570.0 - 570.0 84 300 bp Ba2 BB Takeover

4/21/2015 Unicom Systems Inc 200.0 - 200.0 250 NA NR NR General Purpose

4/16/2015 Redcentric plc 76.4 61.1 15.3 60 NA NR NR Corp. purposes

4/8/2015 Claranet 163.5 - 163.5 NA NA NR NR Corp. purposes

4/1/2015 GTT Communications, Inc. GTT 255.0 25.0 230.0 Secured 60 NA NR NR Takeover

3/31/2015 Lincrea Corp 10.1 10.1 - 13 NA NR NR Work. cap.

3/27/2015 Modulat Inc 7.6 - 7.6 97 NA NR NR Capital expend.

3/27/2015Tokyo Keiki Information System

Inc10.9 - 10.9 36 NA NR NR Work. cap.

3/24/2015 ITFOR Inc 12.6 12.6 - 12 NA NR NR Work. cap.

3/24/2015 World Wide Technology Inc 1,000.0 1,000.0 - Secured 56 175 bp NR NR Corp. purposes

3/17/2015 SAIC Gemini Inc SAIC 700.0 200.0 500.0 Unsecured 60 225 bp Ba2 NR Corp. purposes

3/17/2015Science Applications

International CorpSAIC 670.0 - 670.0 NA NA NR NR Takeover

3/13/2015 EVRY ASA EVRY 704.7 130.2 574.4 Secured 84 500 bp NR NR LBO Apax Partners

3/3/2015 Alorica Inc 500.0 200.0 300.0 60 300 bp NR NR Takeover

2/6/2015 Advanced Computer Softw are ACS 731.6 50.0 681.6 Secured 84 550 bp B2 B LBO VISTA Fund Services Limited

2/2/2015 Presidio Corp 650.0 50.0 600.0 Secured 59 425 bp B1 B SBO Apollo Global Management

1/27/2015 Insight Global Inc 568.0 60.0 508.0 Secured 81 425 bp B1 B Corp. purposes Ares Management LLC

1/22/2015 Presidio Corp 650.0 50.0 600.0 Unsecured 84 525 bp B1 B SBO Apollo Global Management

1/1/2015 Salient Solutions 80.0 30.0 50.0 Unsecured 60 325 bp NR NR Corp. purposes Frontenac Co

12/31/2014 Inventus Solutions LLC 82.0 - 82.0 Unsecured NA NA NR NR Corp. purposes Clearlake Capital Group LLC

12/31/2014Map Communications Holdings

Inc52.0 25.0 27.0 56 375 bp NR NR Corp. purposes

12/30/2014 CRGT Inc 115.0 15.0 100.0 Secured 72 650 bp B2 B LBO Bridge Grow th Partners LLC

12/27/2014 UBIC Inc 8.3 8.3 - Unsecured 13 NA NR NR Work. cap.

12/19/2014 Salient Solutions 80.0 30.0 50.0 60 325 bp NR NR Corp. purposes Frontenac Co

12/16/2014 Gartner Inc IT 1,500.0 400.0 1,100.0 60 125 bp NR NR Corp. purposes

12/11/2014 Compuw are Corp CPWR 1,995.0 100.0 1,895.0 Secured 60 NA B2 B LBO Thoma Bravo

12/5/2014 World Wide Technology Inc 1,000.0 1,000.0 - Secured 59 175 bp NR NR Corp. purposes

12/4/2014 Allgeier Holding AG 99.0 - 99.0 Unsecured 84 170 bp NR NR Corp. purposes

12/2/2014 TierPoint LLC 465.0 45.0 420.0 Secured 84 425 bp B2 B+ TakeoverJZ Equity Partners, Ontario Teachers Pension Plan,

RedBird Capital Partners LLC, Stephens Group Inc

11/20/2014Cognizant Technology Solutions

CorpCTSH 1,750.0 750.0 1,000.0 60 100 bp NR NR Takeover

Select Recently Closed Leveraged Loans (As of May 29, 2015)

IT Services/Outsourcing Monthly June 2015

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Jun 07 - Jun 11 Cisco Live, US 2015 San Diego Convention Center - San Diego, CA Link to Conference Website

Jun 23 - Jun 26 2015 Red Hat Summit Hynes Convention Center - Boston, MA Link to Conference Website

Jul 12 - Jul 16 Microsoft Worldwide Partner Conference Orange County Convention Center - Orlando, FL Link to Conference Website

Aug 09 - Aug 11 Xchange 2015 Gaylord National - Washington, DC Link to Conference Website

Aug 24 - Aug 27 The SharePoint Conference Sheraton Boston Hotel - Boston, MA Link to Conference Website

Aug 30 - Sep 03 VMWorld 2015 Moscone Center - San Francisco, CA Link to Conference Website

Sep 15 - Sep 18 Dreamforce 2015 Moscone Center - San Francisco, CA Link to Conference Website

Sep 20 - Sep 22 Midsize Enterprise Summit West 2015 Hyatt Century Plaza - Los Angeles, CA Link to Conference Website

Sep 28 - Oct 01 Workday Rising 2015 TBA - Las Vegas, NV Link to Conference Website

Sep 29 - Oct 01 Strata + Hadoop World TBA - New York, NY Link to Conference Website

Oct 04 - Oct 05 Gartner Symposium 2015 Walt Disney World Resorts, Orlando, FL Link to Conference Website

Oct 25 - Oct 29 Oracle Open World Moscone Center - San Francisco, CA Link to Conference Website

Nov 11 - Nov 13 IT Nation 2015 Hyatt Regency Orlando - Orlando, FL Link to Conference Website

Dec 09 - Dec 10 NexGen Cloud Confernce & Expo San Diego Convention Center - San Diego, CA Link to Conference Website

Feb 14 - Feb 17 IT Service Management Conference and Exhibiton TBA - Las Vegas, NV Link to Conference Website

Feb 21 - Feb 25 IBM InterConnect 2016 MGM Grand & Mandalay Bay - Las Vegas, NV Link to Conference Website

Mar 07 - Mar 10 Annual North American Shared Services & Outsourcing Week Omni ChampionsGate - Orlando, FL Link to Conference Website

May 02 - May 06 Interop Las Vegas Mandalay Bay Convention Center - Las Vegas, NV Link to Conference Website

May 17 - May 19 Sapphire Now Orange County Convention Center - Orlando, FL Link to Conference Website

Upcoming Company Events

Date Time Company Event Location / Dial-in and Pass code Additional Resources

Jun 25 5:30 AM Accenture plc Earnings Call Dial-in: (800) 230-1074 Investor Relations

Jul 09 9:00 AM Tata Consultancy Services Limited Earnings Call TBA Investor Relations

Jul 10 9:00 AM Infosys Ltd. Earnings Call TBA Investor Relations

Jul 15 9:00 AM WNS (Holdings) Ltd. Earnings Call TBA Investor Relations

Jul 20 9:00 AM International Business Machines Corporation Earnings Call TBA Investor Relations

Jul 21 9:00 AM Hexaware Technologies Limited Earnings Call TBA Investor Relations

Jul 21 9:00 AM Acando AB (publ.) Earnings Call TBA Investor Relations

Jul 22 9:00 AM Tieto Oyj Earnings Call TBA Investor Relations

14

Source: CapIQ, Company Websites

Note: Bold denotes planned attendance by Pacific Crest Securities IT services team member

Upcoming Events

Denotes Bank Holiday Denotes Event

June

S M T W R F S

1 2 3 4 5 6

7 8 9 10 11 12 13

14 15 16 17 18 19 20

21 22 23 24 25 26 27

28 29 30

July

S M T W R F S

1 2 3 4

5 6 7 8 9 10 11

12 13 14 15 16 17 18

19 20 21 22 23 24 25

26 27 28 29 30 31

IT Services/Outsourcing Monthly June 2015

15

Disclosure: KeyBanc Capital Markets is a trade name under which corporate and investment banking products and services of KeyCorp and its subsidiaries, KeyBanc Capital Markets Inc., member

NYSE/FINRA/SIPC (“KBCMI”), and KeyBank National Association (“KeyBank N.A.”), are marketed. Pacific Crest Securities is a division of KBCMI. Securities products and services are offered by

KeyBanc Capital Markets Inc.and its licensed securities representatives, who may also be employees of KeyBank N.A.. Banking products and services are offered by KeyBank N.A..

This report was not issued by our research department. The information contained in this report has been obtained from sources deemed to be reliable but is not represented to be complete, and it

should not be relied upon as such. This report does not purport to be a complete analysis of any security, issuer, or industry and is not an offer or a solicitation of an offer to buy or sell any securities.

This report is prepared for general information purposes only and does not consider the specific investment objectives, financial situation and particular needs of any individual person or entity.

KeyCorp Overview KeyBanc Capital Markets

Recent IT Services Transactions

Corporate and Investment Bank focused on the middle market

Full-services capabilities:

- Equity Capital Markets - Sales & Trading

- Leveraged Finance - Mergers & Acquisitions

- Debt Capital Markets - Financial Sponsor Coverage

Over 750 bankers in 20 offices: Albany, Atlanta, Boston, Charlotte,

Chicago, Cincinnati, Cleveland, Columbus, Dallas, Houston,

Indianapolis, Los Angeles, Nashville, New York, Philadelphia,

Portland, Salt Lake City, San Francisco, Seattle and Syracuse

Bankers organized by industry focus and transaction expertise

Over 90 senior and associate equity research analysts, tracking

more than 775 companies across four major industry sectors Sole Community Banking Offices (8 States)

Sole Corporate Banking Offices (14 States)

Headquarters: Cleveland, OH

Combined Corporate and Community Banking Offices (6 States)

Investment Banking Office

- Team Contacts

For additional information on Pacific Crest Securities’ IT Services Practice, please contact any of the individuals listed below:

March 2014

Buy-Side Advisor

has acquired

April 2015

Lead Arranger

$255,000,000

Senior Secured Credit Facilities

April 2015

Buy-Side Advisor

Seattle, WA 1301 5th Ave., 23rd Floor

Seattle, WA 98101

San Francisco, CA One Embarcadero Center, Ste. 1100

San Francisco, CA 94111

Boston, MA 225 Franklin St., 18th Floor

Boston, MA 02110

Charlotte, NC 5935 Carnegie Blvd.,

Charlotte, NC 28209

Brett Deware

Analyst

Technology Group

brett.deware@key.com

(617) 385-6247

John Brock

Managing Director

Segment Head

jbrock@key.com

(206) 684-6226

Dev Navare

Director

Technology Group

dnavare@key.com

(617) 385-6225

Niket Gandhi

Vice President

Technology Group

niket.gandhi@key.com

(617) 385-6231

Chris Headrick

Managing Director

Technology M&A

cheadrick@key.com

(415) 486-3410

Tim Monnin

Managing Director

Technology Group

timothy.monnin@key.com

(704) 651-9371

Jason Black

Vice President

Technology Group

jblack@key.com

(206) 684-6581

October 2014

Senior Lender

$1,750,000,000

Credit Facilities

has acquired