|By PR Newswire||
|February 13, 2013 09:01 AM EST||
NEW YORK, Feb. 13, 2013 /PRNewswire/ -- The aggregate value of technology mergers and acquisitions (M&A) declined 35% worldwide in 2012, to US$114.1b from US$175.7b in 2011, according to Ernst & Young's Global technology M&A update: October-December 2012 and year in review report [hyperlink to the report]. Deal value in 4Q2012 was US$29.4b, down 4% year over year (YOY) from US$30.5b in 4Q 2011.
Nearly the entire full-year decline came from deals above US$1b in value. For example, the largest deal of 2012 would have placed fifth in 2011 and only two 2012 deals would have made it onto the 2011 top 10 list. Companies were hesitant to engage in large, transformative, technology deals because the uncertain macroeconomic environment increased many risks, particularly the risk of an incorrect valuation as equities markets fluctuate and buyers believe many company values remain high.
Deal volume held steady, however, as companies continued to engage in smaller, more strategic deals driven by technology megatrends that are generating transformative innovation in technology and leading to technology-enabled innovation in other industries. These megatrends include smart mobility, cloud computing, social networking, big data analytics and accelerated adaptation, as technology companies rapidly adapt to the needs of specific industries and other industries rapidly adapt to the evolving possibilities that technology enables.
Both corporate and private equity (PE) deal-making declined. The aggregate disclosed value of PE deals declined by nearly half (down 47%), to US$18.5b in 2012 from US$34.8b in 2011. Aggregate value of corporate deals declined 32% to US$95.6b in 2012 from US$140.9b in 2011. The average value of deals that had disclosed values was US$188m, down 14% from US$218m in 2011.
Joe Steger, Global Technology Industry, Transaction Advisory Services Leader, at Ernst & Young, says:
"The macroeconomic pressures that returned in late 2011 held down global technology M&A activity in 2012. But, that pressure also helped clarify what's important. We saw growth in the strength of transformative megatrends — social-mobile-cloud, big data analytics and accelerated adaptation — while the really big-ticket deals pulled back. Heading into early 2013, the short-term outlook suggests a soft couple of quarters but the long-term outlook for technology M&A remains strong, as both technology and non-technology industries have an ongoing need to adapt to disruptive technology innovation."
- Cloud computing/Software-as-a-Service (SaaS) deals dominate M&A landscape: Largely on the strength of SaaS growth, the cloud/SaaS megatrend "ran away" from the rest of the pack of deal-driving trends in 2012, growing to more than 15% of global technology M&A deal volume. Cloud/SaaS deals ranged from supply chain management, marketing and retail SaaS to cloud-oriented networking gear. Big data analytics deal volume saw similar growth, but from a smaller base.
- Non-technology companies buying technology outpaces other deal types: To help accelerate their adaptation to the innovation that technology is enabling in many industries, non-technology buyers increased technology-buying activity all year, ending with 10% of full-year aggregate value and 12% of volume.
- Megatrends drive increasing share of deals: In addition to cloud/SaaS and big data analytics, smart mobility, social networking, advertising and marketing, security, mobile/e-payments and health care information technologies (HIT) all drove a larger number of deals in 2012 than in 2011, even as overall deal-making held steady. Thus, their footprint in the global technology M&A landscape increased.
Cross-border deals decline for first time in three years
Cross-border deal volume declined for the first time in three years, to 970 deals in 2012 from 999 deals in 2011 (-3%). The full-year 2012 value of cross-border deals fell 32% to US$47b from US$68.9b in 2011. Because that decline was less than the overall 35% drop, cross-border aggregate value rose to 41% of overall aggregate value from 39% in 2011. But cross-border deal-making followed the same pattern we saw in 2011 – it climbed in the first half of the year and fell in the second half. In 4Q4 2012, cross-border value fell to US$8b, or 27% of quarterly aggregate value.
The Americas continued as the major trendsetter in social-mobile-cloud and big data analytics deals in 2012, acquiring 92% of full year global volume and disclosed value. In Asia-Pacific and Japan, online and mobile video and video games were the significant value drivers for technology M&A during 2012. In Europe, the Middle East and Africa (EMEA), cloud/SaaS, smart mobility and social networking megatrends propelled much of the M&A buying in 2012.
Looking ahead: mixed signals for technology M&A with possible recovery in late 2013
In 4Q12, technology M&A data gave mixed signals, suggesting that the market might be approaching a near-term bottom. However, the report noted 22% YOY growth in mid-priced deals (between US$100m and US$1b) in 4Q12, which suggests that the broad-based need for transactions that help companies accelerate their adaptation to transformative technology innovation has not changed. What has changed is that macroeconomic uncertainty increased throughout 2012 at the same time that many valuations increased. This was demonstrated by the 16% increase in the NASDAQ, driving up the valuation risk inherent in large transformative deals.
"We expect the first quarter of 2013 will be seasonally down. Overall, we expect a relatively stable volume of strategic deals in 2013 as compared with 2012, but with growth weighted more toward the second half of the year," concludes Steger.
Notes to editors
About our M&A update report
Global technology M&A update: October-December 2012 and year in review is based on Ernst & Young's analysis of The 451 Group M&A Knowledgebase data for 2011 and 2012. Deal activity and valuations may fluctuate slightly based on the date that the database is accessed. The full report is available at www.ey.com.
Ernst & Young's Global Technology Center
The technology industry is in a constant state of change — driven by continuous innovation, shifting markets, converging industries, consumer demand and the need for first-mover advantage. Ernst & Young's Global Technology Center connects a worldwide team of more than 15,000 technology professionals to help you navigate the challenges of this continuous change. We provide assurance and tax guidance through a network of experienced advisors to help you manage risk, transform business performance and sustain improvement. We can help you deliver cost-effective innovation, balance product portfolios, maintain effective supply chains, and identify, execute and integrate strategic growth transactions. Our global technology network leverages our leading market share position in serving technology companies to provide you with timely, reliable information. Our teams use a cross-discipline, collaborative approach to help you achieve your business objectives. We encourage our people to use their ingenuity and initiative to help you develop approaches, create options and seize opportunities. It's how Ernst & Young makes a difference.
About Ernst & Young
Ernst & Young is a global leader in assurance, tax, transaction and advisory services. Worldwide, our 167,000 people are united by our shared values and an unwavering commitment to quality. We make a difference by helping our people, our clients and our wider communities achieve their potential.
Ernst & Young refers to the global organization of member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit www.ey.com.
This news release has been issued by EYGM Limited, a member of the global Ernst & Young organization that also does not provide any services to clients.
SOURCE Ernst & Young
SYS-CON Events announced today that Technologic Systems Inc., an embedded systems solutions company, will exhibit at SYS-CON's @ThingsExpo, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Technologic Systems is an embedded systems company with headquarters in Fountain Hills, Arizona. They have been in business for 32 years, helping more than 8,000 OEM customers and building over a hundred COTS products that have never been discontinued. Technologic Systems’ pr...
Mar. 29, 2017 02:30 PM EDT Reads: 3,798
SYS-CON Events announced today that Auditwerx will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Auditwerx specializes in SOC 1, SOC 2, and SOC 3 attestation services throughout the U.S. and Canada. As a division of Carr, Riggs & Ingram (CRI), one of the top 20 largest CPA firms nationally, you can expect the resources, skills, and experience of a much larger firm combined with the accessibility and attent...
Mar. 29, 2017 02:30 PM EDT Reads: 652
SYS-CON Events announced today that CA Technologies has been named “Platinum Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. CA Technologies helps customers succeed in a future where every business – from apparel to energy – is being rewritten by software. From ...
Mar. 29, 2017 02:30 PM EDT Reads: 2,265
SYS-CON Events announced today that HTBase will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. HTBase (Gartner 2016 Cool Vendor) delivers a Composable IT infrastructure solution architected for agility and increased efficiency. It turns compute, storage, and fabric into fluid pools of resources that are easily composed and re-composed to meet each application’s needs. With HTBase, companies can quickly prov...
Mar. 29, 2017 02:15 PM EDT Reads: 3,241
SYS-CON Events announced today that Loom Systems will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Founded in 2015, Loom Systems delivers an advanced AI solution to predict and prevent problems in the digital business. Loom stands alone in the industry as an AI analysis platform requiring no prior math knowledge from operators, leveraging the existing staff to succeed in the digital era. With offices in S...
Mar. 29, 2017 01:30 PM EDT Reads: 1,734
Buzzword alert: Microservices and IoT at a DevOps conference? What could possibly go wrong? In this Power Panel at DevOps Summit, moderated by Jason Bloomberg, the leading expert on architecting agility for the enterprise and president of Intellyx, panelists peeled away the buzz and discuss the important architectural principles behind implementing IoT solutions for the enterprise. As remote IoT devices and sensors become increasingly intelligent, they become part of our distributed cloud enviro...
Mar. 29, 2017 12:15 PM EDT Reads: 7,892
SYS-CON Events announced today that T-Mobile will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. As America's Un-carrier, T-Mobile US, Inc., is redefining the way consumers and businesses buy wireless services through leading product and service innovation. The Company's advanced nationwide 4G LTE network delivers outstanding wireless experiences to 67.4 million customers who are unwilling to compromise on ...
Mar. 29, 2017 11:45 AM EDT Reads: 2,571
SYS-CON Events announced today that Infranics will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Since 2000, Infranics has developed SysMaster Suite, which is required for the stable and efficient management of ICT infrastructure. The ICT management solution developed and provided by Infranics continues to add intelligence to the ICT infrastructure through the IMC (Infra Management Cycle) based on mathemat...
Mar. 29, 2017 11:00 AM EDT Reads: 3,430
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
Mar. 29, 2017 10:15 AM EDT Reads: 1,716
SYS-CON Events announced today that Cloudistics, an on-premises cloud computing company, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Cloudistics delivers a complete public cloud experience with composable on-premises infrastructures to medium and large enterprises. Its software-defined technology natively converges network, storage, compute, virtualization, and management into a ...
Mar. 29, 2017 10:00 AM EDT Reads: 2,339
In his session at @ThingsExpo, Eric Lachapelle, CEO of the Professional Evaluation and Certification Board (PECB), will provide an overview of various initiatives to certifiy the security of connected devices and future trends in ensuring public trust of IoT. Eric Lachapelle is the Chief Executive Officer of the Professional Evaluation and Certification Board (PECB), an international certification body. His role is to help companies and individuals to achieve professional, accredited and worldw...
Mar. 29, 2017 08:45 AM EDT Reads: 940
In his General Session at 16th Cloud Expo, David Shacochis, host of The Hybrid IT Files podcast and Vice President at CenturyLink, investigated three key trends of the “gigabit economy" though the story of a Fortune 500 communications company in transformation. Narrating how multi-modal hybrid IT, service automation, and agile delivery all intersect, he will cover the role of storytelling and empathy in achieving strategic alignment between the enterprise and its information technology.
Mar. 29, 2017 08:00 AM EDT Reads: 7,542
Microservices are a very exciting architectural approach that many organizations are looking to as a way to accelerate innovation. Microservices promise to allow teams to move away from monolithic "ball of mud" systems, but the reality is that, in the vast majority of organizations, different projects and technologies will continue to be developed at different speeds. How to handle the dependencies between these disparate systems with different iteration cycles? Consider the "canoncial problem" ...
Mar. 29, 2017 06:00 AM EDT Reads: 9,074
The Internet of Things is clearly many things: data collection and analytics, wearables, Smart Grids and Smart Cities, the Industrial Internet, and more. Cool platforms like Arduino, Raspberry Pi, Intel's Galileo and Edison, and a diverse world of sensors are making the IoT a great toy box for developers in all these areas. In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists discussed what things are the most important, which will have the most profound e...
Mar. 29, 2017 04:00 AM EDT Reads: 15,124
Keeping pace with advancements in software delivery processes and tooling is taxing even for the most proficient organizations. Point tools, platforms, open source and the increasing adoption of private and public cloud services requires strong engineering rigor - all in the face of developer demands to use the tools of choice. As Agile has settled in as a mainstream practice, now DevOps has emerged as the next wave to improve software delivery speed and output. To make DevOps work, organization...
Mar. 29, 2017 03:45 AM EDT Reads: 2,175
My team embarked on building a data lake for our sales and marketing data to better understand customer journeys. This required building a hybrid data pipeline to connect our cloud CRM with the new Hadoop Data Lake. One challenge is that IT was not in a position to provide support until we proved value and marketing did not have the experience, so we embarked on the journey ourselves within the product marketing team for our line of business within Progress. In his session at @BigDataExpo, Sum...
Mar. 29, 2017 03:30 AM EDT Reads: 3,261
Web Real-Time Communication APIs have quickly revolutionized what browsers are capable of. In addition to video and audio streams, we can now bi-directionally send arbitrary data over WebRTC's PeerConnection Data Channels. With the advent of Progressive Web Apps and new hardware APIs such as WebBluetooh and WebUSB, we can finally enable users to stitch together the Internet of Things directly from their browsers while communicating privately and securely in a decentralized way.
Mar. 29, 2017 03:00 AM EDT Reads: 6,104
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm.
Mar. 29, 2017 01:15 AM EDT Reads: 2,535
What sort of WebRTC based applications can we expect to see over the next year and beyond? One way to predict development trends is to see what sorts of applications startups are building. In his session at @ThingsExpo, Arin Sime, founder of WebRTC.ventures, will discuss the current and likely future trends in WebRTC application development based on real requests for custom applications from real customers, as well as other public sources of information,
Mar. 29, 2017 01:00 AM EDT Reads: 1,141
In his General Session at 17th Cloud Expo, Bruce Swann, Senior Product Marketing Manager for Adobe Campaign, explored the key ingredients of cross-channel marketing in a digital world. Learn how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects).
Mar. 28, 2017 11:15 PM EDT Reads: 3,537