|
|
|
06 Nov 2006
The value of global mergers and acquisitions (M&A) in the IT sector soared in the first half of 2006, owing to a buoyant telecoms market, according to the latest research from analyst Datamonitor.
In the first half of the year there were 539 M&A transactions in the global IT sector worth $199.6bn, compared with 507 deals worth $113.65bn in the first half of 2005.
Tom Jowitt, senior analyst for technology finance at Datamonitor, said: “The breakdown of deals for the different technology sectors reveals the telecoms sector scored big again this year, with 26 deals done to the value of almost $116bn. In the first half of last year 25 deals were recorded in that sector with a total value of $43bn.”
Jowitt added that the size of the telecoms market deals has distorted the average deal size, with large-scale international agreements such as the $89.4bn take-over by AT&T of BellSouth, and the $15.5bn Softbank acquisition of Vodafone Japan.
“We saw more acquisitions in the services space over the last year because it is still quite a fragmented market. There are a lot of medium-sized services companies buying their rivals,” Jowitt said.
He added that previously investors often used an Initial Public Offering as an exit strategy to get their return on investment, but many investors now rely on M&A to grow businesses or exit the market.
Tom Perry, head of marketing at VAR Freedom, said: “We have made one acquisition, but we are exploring options around acquiring a data reseller. There has been tons of M&A activity this year, and there is lots more to come. The converged space is the driving force, with data resellers buying voice players, and vice-versa.”
Perry added that the quickest way to expand in the market is to make acquisitions to increase scale and gain a wider customer base.
“We look at the financial elements of potential targets and access their cultural fit,” he said. “I think such levels of M&A activity will continue for another year or two.”
>> Further reading:
Related articles
In this video find out about the fast-growing Chinese vendor's plans for market domination and how the channel is its route of choice
Find out what gifts Acer has in store for partners for 2012 in this exclusive roundup of its recent conference
CRN's premier networking event is back on 17 May at the Ricoh Arena
Date: Thu 17 May 2012
Channel fighters preparing to square up once more on 24 May
Date: Thu 24 May 2012
The proliferation of endpoint devices within the enterprise has highlighted the shortcomings of one of the traditional approaches to data security
This Forrester report compares the costs and benefits of legacy email and productivity software with Google Apps
Dave discovers that rozzers are seemingly living in the technology dark ages
Mark Needham, founder of distributor Widget, argues that John Browett leaves for Apple with Dixons in better shape than when he arrived
|
|
|
Do you agree?
Have your say