Contact: Brenon Daly, Tim Miller
After a decade of charting the ups and downs of the tech M&A market, The 451 M&A KnowledgeBase hit a significant milestone earlier this week: we entered our 30,000 transaction in what has become the go-to database for the tech dealmaking community. When we started building our comprehensive database on January 1, 2002, the tech industry was still struggling to recover from a meltdown that it had largely brought on itself.
With the drastic ‘revaluation’ that swept through the tech landscape after the Internet bubble burst, it hardly seemed possible in the early 2000s that we were about to chronicle a decade that would see a staggering $2.5 trillion in collective M&A spending. (To put that mind-boggling figure into perspective, consider that the aggregate value of tech deals equals the annual GDP for all of France.)
What’s more, the pace of dealmaking is accelerating. It took us basically four and a half years to record the first 10,000 transactions in The 451 M&A KnowledgeBase. But we’ve blazed through each of the two subsequent 10,000-deal blocks in just less than three years. For another indication of just how sharp the acceleration has been, consider this: while the tech M&A spending levels of 2004 and 2011 matched each other almost exactly at $225bn, last year saw nearly twice as many transactions (3,730) compared with 2004 (2,080).
Milestones in tech M&A
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Source: The 451 M&A KnowledgeBase
There are a number of reasons for the dramatic – and dizzying – pickup in the pace of tech M&A. Obviously, the industry is more mature, which brings increased pressure to find new growth markets that companies can buy their way into. (Cash levels at most of these buyers, meanwhile, have never been higher, with tens of billions of dollars sloshing around in many corporate treasuries.) That has meant acquisitions that have not only taken companies into markets that have historically been off-limits (think of Dell going on a two-year shopping spree in storage rather than continue to partner with outside vendors), but also led them into markets that are only emerging (think of Google, essentially a media company, getting into the mobile hardware game by buying Motorola Mobility).
Undoubtedly, those trends will continue to drive M&A at a rapid rate. (Already this year, we’re moving along at the same record-level clip that we registered in the same timeframe last year in terms of deal volume.) To help you make sense of the deal flow – and ultimately make better deals, whatever side of the transaction you find yourself – we invite you to test drive The 451 M&A KnowledgeBase. We’re confident that you’ll find the insight, in-depth categorization and propriety estimates for deal terms in the database an indispensible M&A tool. Just click here for a free, no-obligation trial of The 451 M&A KnowledgeBase.