Tag: VZ

A December rebound in tech M&A

Brenon Daly

Contact: Brenon Daly

After three months of basically standing on the sidelines, tech dealmakers have stepped back into the market in a big way in December. During just the first week of the final month of 2011, the value of announced transactions across the globe hit $8.6bn, led by SAP’s announcement of the largest-ever SaaS deal with its $3.6bn purchase of SuccessFactors and Verizon’s mammoth $3.6bn reach for some excess wireless spectrum with its pickup of SpectrumCo.

To put that $8.6bn of deal value in December into context, consider this: it already equals the full-month total for September and is fully twice the amount of spending in November. But then, last month was particularly grim for M&A. In fact, spending in November sank to its lowest monthly level in more than two and a half years, which was the depths of the Great Recession. Further, the number of transactions in November (only 240) stands as the lowest of any month so far in 2011 and is roughly 20% below the typical monthly volume.

Terremark triples under Verizon

Brenon Daly

Just seven months after Terremark Worldwide was officially absorbed by Verizon Communications, the business has more than tripled its size as Terremark has become the telecom giant’s main services brand. At the time of the acquisition, which was announced in late January and closed in early April, Terremark was generating about $400m in sales. (Colocation services account for the vast majority of that revenue, with cloud offerings a small – but much more important and valuable – slice of the business.) The business is now running at $1.4bn, according to Bill Lowry, Terremark’s VP for Cloud Services.

Speaking at a Monday evening keynote at the Cloud Expo, Lowry added that the growth is coming both from the expansion of Terremark’s traditional business as well as Verizon’s decision to roll its services businesses into Terremark. (The ‘reverse integration’ makes sense to us because Terremark has much more enterprise credentials than Verizon, which we recently noted.) That means, for instance, that the managed security services provider business, which Verizon obtained via its May 2007 purchase of Cybertrust, is now part of Terremark. Verizon also transferred over to Terremark some 450 professional services employees, part of a broader buildup that has tripled Terremark’s headcount from 1,000 at the time of the acquisition to some 3,000 now.