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

By Michael Vizard

Mergers and acquisitions in the tech sector mirror the transitions companies undergo as they address industry advances. A new report from Ernst & Young illustrates the frenzied pace M&As in the IT space grew in the second quarter—and reflects the industry's increasing focus on the cloud, mobility and big data. "Cloud/SaaS [software-as-a-service] technology was a key enabler for a broad spectrum of deals, and many had security or big data analytics aspects or both," the report said. "The volume of deals targeting those three technologies all increased" rapidly as companies added to their arsenals of new technologies. Yet, even in the enterprise IT arena, the acquisitions of Micros Systems by Oracle and Fusion-io by Sandisk show continued M&A moves by traditional IT vendors. Although the valuation of tech deals in the second quarter dropped 21 percent from the prior quarter, Ernst & Young noted that, overall, for the first half of 2014, the valuations of M&As were still 70 percent higher than a year ago. Year-over-year valuations of IT M&As rose 57 percent for the quarter. Only a dozen deals were valued at $1 billion or more for the quarter. Channel Insider examines key trends and examples of deals outlined in the report.

This article was originally published on 2014-09-02