Global technology M&A 4Q14 and year in review

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While big-ticket deals declined dramatically in 4Q14, full-year 2014 nonetheless set M&A volume and value records surpassed only in 2000, at the height of the dotcom bubble.

Mid-size deals (from $100 million up to $1 billion) remained strong in 4Q14. And deal volume set another new post-dotcom-bubble record. If equity market volatility calms, we could see a rapid return of big transformative deals.

A directional view of select 4Q14 deal-driving trends

EY - A directional view of select 4Q14 deal-driving trends

Highlights

  • 4Q14 aggregate value of disclosed-value deals was $44.9 billion, down 39% from a record-setting third quarter. But the 2014 annual total was $237.6 billion, higher than any year on record except 2000.
  • At 959 deals, 4Q14 volume set a fourth consecutive post-dotcom-bubble quarterly record. Full-year 2014 posted 3,512 deals, besting 3,345 in 2007 to achieve the highest volume of any year except 2000.
  • Advertising and marketing, security and internet of things (IoT) aggregate deal values jumped, with the first two roughly doubling their year-to-date (YTD) totals through 3Q14.
  • Private equity (PE) and non-technology buyers both also increased aggregate value. PE buyers appeared to target companies struggling with mobile-social-cloud transitions (companies we call “in the crosshairs”).
  • Cross-border (CB) aggregate deal value declined 38% from a record-setting 3Q14 but remained strong, with a 45% share of total quarterly value.

Total and average deal value for deals with disclosed values 2012-14

EY - Total and average deal value 2012 to 2014

Global technology transaction scorecard (corporate and PE), 4Q14

EY - Global technology transaction scorecard (corporate and PE), 4Q14

“Globally, technology corporate development teams took a breather in 4Q14. But I don’t doubt for a minute they’ll be back with transformative deals soon, because megatrend-related innovation is creating more need for true solutions-oriented selling, revealing valuable ‘hidden gems’ inside large organizations, placing more companies in the crosshairs of innovative upstarts and aggressive activists, and increasing all users’ need for state-of-the-art security solutions.”
Jeff Liu
Global Technology Industry
Transaction Advisory Services Leader
Ernst & Young LLP

CB deal value flow for technology deals (disclosed value), 4Q14

EY - CB deal value flow for technology deals (disclosed value), 4Q14

Our comprehensive quarterly and year in review report gives you insights into deal-driving trends, sector and regional snapshots and cross-border deal activity.

 


Note: all values in our report are of disclosed-value deals only and all dollar references are in US$ unless otherwise indicated.