A mixed picture for tech M&A in August

Contact: Brenon Daly

The value of tech M&A around the globe in August ticked higher by about one-quarter over the same month last summer, the fourth consecutive increase in year-over-year monthly spending. However, the slump in the number of deals continued in August. We have yet to see a single month in 2013 with more transactions announced than in the comparable month of 2012, leaving total deal flow down about 17% so far this year.

We tallied 260 acquisitions with an aggregate value of $13.2bn this month. (That compares with 285 deals worth $10.6bn in the same month last year.) August’s significant transactions included the largest purchases by Chinese search engine Baidu ($1.85bn for 91 Wireless Websoft) and the reconstituted AOL ($465m for Adap.tv). IBM also paid one of its highest-ever M&A multiples in its reach for Trusteer. (Subscribers to The 451 M&A KnowledgeBase can see our estimated terms for this transaction.)

The split picture in the M&A market mirrors the recent crosscurrents in the equity markets, which influence one another. All of the major US stock indexes declined in August, but are still higher by a mid-teens percentage since the beginning of the year. We would note that a number of previously active tech buyers that haven’t necessarily participated in the stock market’s double-digit percentage rally have been much less active shoppers so far this year. Oracle, VMware and BlackBerry are all examples of that.

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