This year's merger and acquisition market is on pace for a strong finish, according to one reading. Indeed, M&A across the media, information, marketing, software, and tech sectors, reached 1,500 transitions valued at $160 billion total during the first three quarters of 2017, according Jegi's research.
The software and technology services sectors represented 46 percent of the deal flow through September -- with the pendulum swinging rapidly towards services deals. Indeed, tech-enabled services deals rose 74 percent in value and 27 percent in number of deals from the previous year, while software was down 60 percent in value and 30 percent in number of deals. ChannelE2E has seen similar M&A momentum across the VAR, MSP and CSP ecosystems.
Digging further into the Jegi data, the IT Services and Distribution sector represented 34 percent of the technology services sector deals. Some of the bigger IT deals we saw this year included HIG Capital’s acquisition of NCI Information Systems for $283 million; ManTech International’s purchase of public-sector IT services company InfoZen for $180 million; and AE Industrial Partners' acquisition of CDI Corporation for $154 million.
M&A activity in the SMB sector also has been hot. Roughly 2,589 small businesses were bought or sold in Q3 of 2017, according to a BizBuySell Insights Report. A solid economy, optimism over tax reform, and the possibility of relaxed regulations under the current administration helped to fuel that activity, the report sad.
While all the data isn’t in for the final quarter of 2017, Jegi points out that the outlook is favorable. Natural disasters like the hurricanes in Florida and Texas caused a dip in consumer confidence in those states, but overall consumers believe economic conditions are favorable and they expect the economy to continue expanding in the short-term.
We’re also seeing more companies preparing for future acquisitions. In November, Reliam LLC, an MSP with Amazon Web Services and Microsoft Azure cloud experience, hired a new CEO and announced it was filling its war chest for M&A moves. Kaseya meanwhile has been laying out plans for its own acquisitions since September.
For now, the M&A activity doesn’t seem ready to slow down. We’ll be keeping on eye on all the deals as they happen to bring you the latest.
