Contact: Brenon Daly
After two straight quarters that each featured a single blockbuster transaction, tech M&A spending in the just-completed Q2 settled back into a more representative level for the post-recession era. Spending on acquisitions of tech, telecom and Internet companies around the globe from April to June totaled $46bn – essentially matching the value of deals in Q2 of last year as well as the quarterly average from 2010-2012. (Look for our full report on the Q2 M&A totals and trends later today on our website and in our next Daily 451.)
However, Q2 spending comes in about one-third lower than both the first quarter of this year and the final quarter of last year. The decline from mid-$60bn in both of those quarters to mid-$40bn in the just-completed quarter stems primarily from the fact that Q2 didn’t see a mega-transaction like the one that boosted totals in the other two quarters.
Both Q4 2012 and Q1 2013 featured single deals valued at more than $20bn, roughly the equivalent to the aggregate total of the four largest deals announced in Q2 2013. The $24bn proposed Dell buyout, announced in February, and Softbank’s $20bn reach for Sprint Nextel last October are the two largest transactions of the past half-decade.
Turning to deal volume, we would note that even as tech M&A spending returned to more representative post-recession levels in Q2, the number of transactions didn’t keep pace. In fact, overall quarterly deal flow plunged to its lowest level since the recession. From April to June, dealmakers announced just 751 transactions, a sharp 18% year-over-year decline. (Again, we’ll have a full report on Q2 M&A activity available later today on our website and in our next Daily 451.)
Recent quarterly deal flow
|
Source: The 451 M&A KnowledgeBase
For more real-time information on tech M&A, follow us on Twitter @451TechMnA.