Technology companies are of particular importance in the age of digitalization and shape the development of all industries. The M&A partnership Globalscope enables IFBC to support its clients in the worldwide search for suitable target companies and interested buyers.
Between direct and bolt-on acquisitions, private equity buyers are forecast to purchase around 900 technology companies in 2017. Private equity remains a favoured asset class for institutional investors.
As the enterprise market continues to slowly transition to the cloud, the requirement to support hybrid IT environments will drive M&A activity as larger players seek to broaden and deepen their product/service portfolios.
As part of the country’s One Belt, One Road initiative, China continues to support and modernize its traditional manufacturing industries through the acquisition of Western technology companies. This strategy has seen several deals fall foul of national regulators, such as the decision to block the $780m sale of German chip equipment maker Aixtron to a consortium of Chinese investors.
The automotive sector has rapidly emerged as a key technology battleground, that has seen established players acquiring competence at all stages of the value chain.
Investments in IP-based technology companies have significantly increased in volume, across traditional sectors such as semiconductors, as well as more visionary areas such as microsatellites. This environment seems likely to produce significant M&A targets in the near future, that would be expected to command high strategic prices.
Venture capital arms are becoming increasingly popular among trade buyers. On the one hand, to better recognize potential M&A targets and on the other hand, to better understand innovations.
Amazon has sought to strengthen its e-commerce footprint with expansion into the relatively untapped Middle Eastern market through the acquisition of Souq.com for $580m in cash.
HPE has agreed to acquire flash-optimised storage vendor Nimble Storage for circa $1bn in cash. Nimble had never turned a profit since its inception in 2008.
Eventbrite has acquired leading ticketing platform Ticketfly from Pandora for $200m. This deal comes only 2 years after Pandora acquired Ticketfly for $450m, in a deal that intended to link music streaming data with ticket sales.
The following data have been compiled by Globalscope for the sector technology, media & telecoms. Valuation trends for the past five years were analysed. The following graphs show average half-yearly transaction data, comparisons of individual sub-segments and data from listed companies as of mid-August 2017. The Total Market comprises companies and transactions in excess of USD 5 million. The Lower-Mid Market segment comprises companies and transactions in the range of USD 5 million to USD 150 million.