Back in January, PWC shared some numbers on M&A deals across Canada, reporting a huge spike compared to the year prior, and today Ernst & Young has also reported a spike of 41% year over year within the technology sector. According to their data, in Canada, there were 15 deals in the fourth quarter of 2010 to 27 in 2011, smart mobility, cloud computing, social networking, “big data” analytics were all types of businesses that helped contribute to the growth.
“Disruptive megatrends continued to fuel M&A in the technology sector last quarter — especially in Canada,” says Tony Ianni, Leader of Corporate Finance in Ernst & Young’s Transaction Advisory Services practice. “Deal-making in the Americas represented just over half of all 2011 global technology M&A volume alone.”
Trends that have been developing for several quarters — or even years, in some cases — yielded a long string of multibillion-dollar deals last year. Thirty-four deals topped US$1 billion in 2011, including eight in the fourth quarter. Established companies made major consolidation plays and placed big bets on smart mobility (including internet and mobile video), cloud computing and business intelligence/analytics.
“Looking ahead, 2012 could be a slow-growth year for global technology M&A, given the return of macroeconomic volatility,” says Ianni. “We’ve already seen signs that even global tech M&A isn’t immune to the effects of broader uncertainty. While the total global value of tech M&A surged 41% in 2011, fourth-quarter deal volume was the lowest quarterly total since the second quarter of 2010.”