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M&As Pick Up Steam in Cloud, Mobile, Analytics Spaces

Mergers and acquisitions Valuation of Tech M&As Rises At $52.4 billion for the second quarter, the aggregate value of all disclosed-value tech deals soared 57% year-over-year, despite falling 21% from a record-setting first quarter. Lots of Activity Across the IT Sector The volume of deals set a second consecutive record for any quarter in the […]

Written By

Michael Vizard

Sep 2, 2014

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Mergers and acquisitions

Valuation of Tech M&As Rises

At $52.4 billion for the second quarter, the aggregate value of all disclosed-value tech deals soared 57% year-over-year, despite falling 21% from a record-setting first quarter.

Lots of Activity Across the IT Sector

The volume of deals set a second consecutive record for any quarter in the last 6.5 years, rising 39% year-over-year to 872 deals. Deal values year-to-date totaled $119 billion, up 70% from the same period a year ago.

Cloud/SaaS a Large Portion of Tech M&As

Cloud/SaaS and smart mobility deals accounted for more than 42% of volume for the quarter, according to the report.

Cloud Landscape Continues to Shift

Cloud/SaaS deals were about 70% higher in the second quarter of this year than the 2013 average quarterly volume, according to Ernst & Young.

Corporate Deals Dominate

Big vendors swallowed up smaller ones in 806 deals during the second quarter. The aggregate value of corporate deals was up 139% year-over-year to $46 billion.

Private Equity Deals

Private equity deals, driven by venture capitalists, are relatively small. Private equity deal value was $5.9 billion in the second quarter.

The Billion-Dollar Club

Only a dozen deals were valued at $1 billion or more—including Oracle’s acquisition of Micros Systems, Zebra Technologies’ deal to acquire the enterprise business of Motorola Solutions, Apple’s Beats Electronics buy, Analog Devices’ purchase of Hittite Microwave, SanDisk’s purchase of Fusion-io.

Average Deal Size

The vast majority of deals were for below quarter of a billion. For the quarter, the average deal size was $231 million, down 7% year-over-year and 24% from the prior quarter.

Adding MDM Capabilities

Google’s deal for mobile-device management startup Divide indicates a growing focus on increasing Android use in the enterprise, the study said. The value of the deal was undisclosed.

Security Boost

Deals aimed at “aggregating threat data or analyzing real-time network traffic to identify and respond to malware” included Cisco’s purchase of ThreatGrid for an undisclosed amount.

Big Data Expansions

Among the deals that added security to Hadoop software were Cloudera’s acquisition of cloud-based encryption software and Hortonworks’ purchase of security administration and authentication software for its Hadoop distribution.

No Flash in the Pan

Among the many purchases aimed at flash memory technology to boost data center server performance was Sandisk’s acquisition of Fusion-io for $1.3 billion.

Michael Vizard

Michael Vizard is a seasoned IT journalist, with nearly 30 years of experience writing and editing about enterprise IT issues. He is a writer for publications including Programmableweb, IT Business Edge, CIOinsight, Channel Insider and UBM Tech. He formerly was editorial director for Ziff-Davis Enterprise, where he launched the company’s custom content division, and has also served as editor in chief for CRN and InfoWorld. He also has held editorial positions at PC Week, Computerworld and Digital Review.

M&As Pick Up Steam in Cloud, Mobile, Analytics Spaces

Michael Vizard

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