Buoyant IT Mid-Market M&A Activity in Australia Despite Broader Slowdown
Australian mid-market IT M&A activity[1] has remained buoyant despite a slowdown in other industries – deal volumes in the IT sector rose by 6% across Q1–Q3 FY25, compared to a 15% decline across all other industries combined.
Robust Software Valuations Indicate Buyer Confidence
Demand for Australian mid-market software businesses is sustained and valuations are robust. In FY24 & FY25 YTD, the median reported EBITDA multiple for Australian mid-market software businesses was 12.7x, well above the 8.1x across all other industries. This premium reflects high prospective returns for buyers, driven by the recurring revenue profiles and scalability of software businesses.
Strong Activity in the Lower Mid-Market
The smaller end of the mid-market is highly active – 69% of Australian IT deals in FY24 & FY25 YTD were below A$25 million total enterprise value (TEV), with the remaining 31% between A$25–300 million. This consolidation of smaller IT businesses remains a popular strategy among both strategic and financial acquirers. Notable active buyers in the last 5 years include:
International Buyers Drive Activity
Cross-border interest in Australian mid-market IT businesses is particularly strong. In FY24 and FY25 YTD, 52% of deals involved international buyers — substantially higher than the APAC regional average of 19% and the 39% seen in other Australian industries.
The United States led international activity, accounting for 50% of overseas buyers, followed by the United Kingdom (15%), Canada (7%), and Sweden (5%). A recent notable example of international interest was Indian technology group Infosys’ A$98 million acquisition of Australian cybersecurity firm The Missing Link in April 2025.
Financial Buyer Interest Remains High
Financial buyers continue to play an active role in the sector. In FY24 and FY25 YTD, 25% of IT acquirers were private equity or venture capital firms, compared to just 9% across other industries. This demonstrates their strong commitment to investing in technology focused, highly scalable and capital efficient businesses. For example, Software Combined, a private equity backed investment house focused on software acquisitions, recently acquired online content removal business Removify in May 2025.
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1 Deal data was sourced from Acuris Mergermarket on 12 May 2025. The analysis includes the corresponding Australian or APAC deals respectively with TEV ≤ A$300m (where disclosed), involving ≥20% equity stakes across mergers, acquisitions, divestments, and reverse takeovers. Financial years run from 1 July to 30 June, with FY24 and FY25 YTD representing the period from 1 July 2023 to 31 March 2025. Not all transaction metrics were available due to limited public disclosure.