Dealmaking in Tech Slows
It appears that dealmaking across technology, media and telecommunication (TMT) is on a downward slide.
After hitting all-time highs in 2015 and 2016, Mergermarket reports (link opens to PDF) that dealmaking across TMT in Q1 2017 dropped 17.6 percent in deal value compared to the same period last year (695 deals, U.S. $88.8 billion), as 634 deals took place worth U.S. $73.2 billion.
Mergermarket reports that the slowdown would suggest merger and acquisition (M&A) activity targeting TMT has passed its peak as buyers back away from record valuations and consolidation in multiple industries. The sector accounted for 11 percent of global M&A activity, down from 21 percent during the whole of 2016.
Further, Mergemarket states that following a mammoth quarter at the end of 2016 that included the AT&T/Time Warner (U.S. $105 billion) and Century Link/Level 3 (U.S. $34.5 billion) deals, the first three months of 2017 represented the lowest quarterly value since Q2 2012 (241 deals, U.S. $26 billion). This year’s largest U.S. TMT deal saw Cisco acquire application intelligence software firm AppDynamics for U.S. $3.7 billion, just days before it was due to list on Nasdaq.
Here's a regional breakdown of TMT M&A over the years: