Issue 6 2019

108 Acquisition International - Issue 6 2019 2019 started well in terms of M&A targeting the technology sector, according to Zephyr, the M&A database published by Bureau van Dijk. The first quarter of the year was the largest Q1 on record in terms of value, while in terms of volume, it was the second-highest, behind Q1 2016 (4,679 deals). o far in Q2 2019, there have been 2,238 deals worth a combined USD 65,750 million targeting the technology sector announced worldwide. This represents a fairly slow start to the quarter and means that by the time July rolls around, Q2 is likely to represent a decline on both Q2 2018 and Q1 2019. The fact that Q2 to date has been fairly quiet in comparison with Q1 is borne out when looking at the top deals of 2019 to date in the technology sector. The top four transactions by value were all announced during Q1. The year’s most valuable deal to date is worth USD 11,000 million and took the form of an acquisition as a consortium led by Hellman & Friedman agreed to acquire Ultimate Software Group. This was followed by Zhongnan Commercial picking up Beijing EasyHome New Retail Chain Group for USD 5,249 million, while Thoma Bravo bought Ellie May for USD 3,700 million in the third-placed transaction. The most valuable deal targeting the technology sector to have been signed off during Q2 2019 to date is worth USD 2,927 million and involved Deutsche Boerse selling its DAX index business, as well as Axioma and STOXX, to Deutsche Borse Index and Portfolio Risk Analytics. The fact that this deal is not on the same scale as the aforementioned USD 11,000 million Ultimate Software Group takeover partly explains the decline in value between Q1 and Q2 2019 to date. Other sizeable deals to have been announced during Q2 2019 include Expedia Group’s USD 2,589 million purchase of Liberty Expedia Holdings, which was announced in April. In terms of the regions being targeted within the technology sector in the second quarter of 2019, the Far East and Central Asia is leading the way with 837 deals. This places it ahead of second-placed North America, with 656, while Western Europe came third with 493. It was a different story by value as North America topped the rankings, with USD 31,413 million. This was worth more than double the second- placed region as Western Europe was targeted in deals worth a combined USD 15,065 million. The Far East and Central Asia was close behind, with USD 14,284 million. The US’s position at the head of the value rankings is unsurprising when we consider that companies based in the region were targeted in nine of the 20 largest deals announced during Q2 2019, including the two biggest. Western European countries were targeted in six of these deals, while Far East and Central Asia companies featured four times. It will be interesting to see how the situation develops throughout the rest of 2019. 2018 was a particularly impressive year for M&A in the technology sector. The USD 605,339 million-worth of deals announced over the 12 months makes it the best year on record in the sector in terms of value. Although the USD 203,391 million recorded in 2019 to date looks relatively small by comparison, it is not so disappointing when compared to the USD 370,198 million-worth of deals recorded in the whole of 2017, while 2013 and 2014 notched up dealmaking of just USD 224,641 million and USD 286,590 million, respectively. As such, there is plenty of cause for optimism and many will also be hoping for an upturn in dealmaking during the second half of this year. Company: Bureau van Dijk E-Mail: [email protected] Web: www.bvdinfo.com Technology S The US’s position at the head of the value rankings is unsurprising when we consider that companies based in the region were targeted in nine of the 20 largest deals announced during Q2 2019, including the two biggest. Western European countries were targeted in six of these deals, while Far East and Central Asia companies featured four times.