Facebook acquisition of WhatsApp pushes technology M&A levels to dotcom boom level

On the back of the 5th largest technology acquisition of all time, worldwide announced mergers and acquisitions in the sector have hit $42.4 billion during 2014.

Acquirers in the technology space during 2014 have pushed figures up by 39 per cent over the same period in 2013, figures from Thomson Reuters shows.

Not since 2000, when the total reached $79.6 billion, have M&A figures in the technology sector been as high.

The pending $19.5 billion purchase of messaging service WhatsApp by social media platform Facebook is the 7th deal worth more than $10 million to be made public during 2014.

Other large technology investments to have been made during January and February include the $10.8 billion purchase of Dutch business Ziggo by Liberty Global and £14.9 acquisition of Sirius XM Radio by Liberty Media.

Looking back into 2013, statistics from professional services firm EY reveals that global technology M&A aggregate value was driven up by 65 per cent to a ‘post-dotcom-bubble record’ of $188.2 billion.

Deals centred round what EY has identified as ‘five transformative megatrends’ (mobile, social, cloud, big data analytics and accelerated technology adaptation) pushed up transactions as corporates found themselves at crossroads.

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Simon Pearson, EY technology M&A partner, comments, ‘Big, transformative deals returned in 2013, whether driven by the strategic growth opportunities emerging from customer demand related to the five transformative megatrends, or the opportunity to re-invigorate companies distrupted by those megatrends.

‘A surge in confidence in the global economy by technology executives and the disruption being caused by the megatrends, despite recent stock market volatility, continued political instability and lingering valuation gaps, indicate 2014 will be a strong year for technology M&A.’

EY also suggests that 2014 will be another ‘strong year’ for technology M&A on the back of increased momentum at the end of 2013, when quarterly volume averaged 711 deals.

Hunter Ruthven

Hunter Ruthven

Hunter was the Editor for GrowthBusiness.co.uk from 2012 to 2014, before moving on to Caspian Media Ltd to be Editor of Real Business.

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