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Disruption, Competition to Fuel Tech M&As in 2017

M&A Disruption, Competition to Fuel Tech M&As in 2017 In the face of competition and tech disruption, industry execs will continue to turn to mergers and acquisitions. Economic fundamentals will also be a factor. Strengthening Earnings Forecast 75% of tech industry execs express confidence in their organizations’ upcoming corporate earnings, up from 60% who felt […]

Written By: Dennis McCafferty

Nov 2, 2016

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M&A

Disruption, Competition to Fuel Tech M&As in 2017

In the face of competition and tech disruption, industry execs will continue to turn to mergers and acquisitions. Economic fundamentals will also be a factor.

Strengthening Earnings Forecast

75% of tech industry execs express confidence in their organizations’ upcoming corporate earnings, up from 60% who felt this way a year ago.

The Hunt for M&As

50% said their companies intend to pursue M&A deals in the next 12 months, with 38% indicating they have more than five deals in the pipeline.

Expectations for Global Tech M&A Market

29% said the global tech industry M&A market will improve over the next 12 months, but that’s down from 80% who said this a year ago.

M&As: Expansion Plan

28% said they’d primarily pursue M&As in their current sector to grow market share, and 20% said the top M&A driver is the need to move into new geographies.

Inflated Worth

68% said that, during M&As, sellers’ expectations of transaction valuations are higher than that of buyers; just 2% said no such expectation gap exists.

M&A Metrics

54% said they use analytics and big data solutions during M&As to better identify synergies and determine appropriate valuations of the targeted asset, and 53% said they take advantage of these tools to identify growth options and potential targets.

M&As as Expansion Engines

59% said their companies’ growth will be organically driven, while 22% said M&As will drive growth.

What Causes Shake-Ups?

49% view digitization as a top force in the disruption of their core business, while 48% cite sector convergence/increased competition from companies in other sectors.

Staffing Strategies

73% said that, in terms of their employment/talent planning, that they are focusing on shifting internal skills/talent to gain efficiencies from greater automation, as opposed to 53% who said they are looking to create jobs/hire talent.

Lowered Expectations

Just 17% said the global economy will improve in the near future, down significantly from 80% who predicted this a year ago.

Disruption, Competition to Fuel Tech M&As in 2017

Dennis McCafferty

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