M&A transactions in the technology space reflect ongoing acceptance.

M&A transactions in the technology space reflect ongoing acceptance.

By / LUIS DOPORTO

Within the M&A environment, the technology, media, and telecommunications (TMT) segment will be one of the strongest and most up-to-date by 2023.

 

According to S&P Global Market Intelligence, during the second quarter of 2022, the M&A environment averaged 88 million dollars per transaction, with the I.T. sector being the most active and important, as reflected in the acquisition of VMWare by Broadcom for 69.1 billion dollars.

 

The TMT sector has shown its scopes since 2021, a year in which the overall volume of transactions increased by 48% with 8,345 operations, compared to 5,630 in 2020.

 

Furthermore, the overall value of those transactions reached $941.1 billion, an 83% increase from the $514 billion in 2020, according to data presented by KPMG.

 

During this year, mergers and acquisitions in the technology sector have consolidated their leadership by closing at least 25% of the deals finalized globally, and standing out for having some mega-deals such as that of Activision Blizzard for 69 billion dollars.

 

In the coming years, technology will focus on the deployment and integration of the 5G network, internet connectivity through the Internet of Things (IoT) or the Metaverse, which will continue to drive M&A transactions for a long time.

 

Videogame industry bank on an M&A strategy

The video game industry is part of the great dynamics that are moving the global M&A environment, not only because of the growth of its consumption, but because of the possibilities offered by future acquisitions in such a profitable segment.

 

According to some experts, the industry’s growth is slowing down after experiencing an exponential increase during the pandemic; however, there is every reason to believe that transactions between companies within the sector will continue in the coming months and even years.

 

During June 2022, just two $2 billion deals alone raised the year’s total gross transaction value for announced video game mergers and acquisitions, not counting Take-Two’s $12.7 billion acquisition of Zynga, Microsoft’s $69 billion acquisition of Activision Blizzard and Sony’s $3.6 billion acquisition of Bungie earlier in the year.

 

Three deals generated around 85 billion dollars in the M&A environment, with the video games industry surpassing the 2021 annual M&A total in just a couple of months in 2022.

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