ConnectWise’s acquisition of Service Leadership and Pax8’s new partnership with RocketCyber are among the highlights.
2020 was a year of twists and turns and ups and downs that not even the most adept of fortune tellers could have predicted. Finding one’s business bearings was, at times, like trying to find a cotton ball in a blizzard.
Yet somehow, through the chaos, spending on tech mergers and acquisitions (M&A) soared to its highest level in years. Almost impossibly, the total value of tech and telecom transactions announced around the plague-ravaged world in 2020 topped $600 billion, according to 451 Research’s M&A KnowledgeBase. MSPs were at the center of many deals.
|Looking for more M&A? Keep our monthly roundup of mergers and acquisitions impacting the channel.|
According to S&P Global’s Market Intelligence’s annual Tech M&A Outlook, there are a few key highlights worth noting:
- Last year’s record spending came in more than 25% higher than the firm recorded for the “before times” year 2019. Furthermore, it was more than four times the amount spent in the similarly recession-scarred year of 2009.
- The data showed a staggering $485 billion worth of spending on tech and telecom acquisitions in aggregate for the final two quarters of 2020. That pushed the value of deals announced in just the final half of last year higher than the full-year totals for every year except two since 2002 (according to the M&A KnowledgeBase). To top that off, the tech M&A market exited 2020 at a trillion-dollar run rate.
- The second half of 2020 marked a record level of spending as emboldened acquirers started making larger tech purchases. Tech vendors were announcing multibillion-dollar deals that would have been unimaginable just a few months earlier.
- In the case of COVID-19, the slowdown was measured in mere months, rather than years. Already by summer, acquirers’ pent-up demand – combined with Wall Street’s confidence in the tech sector to thrive, not just survive, during the lockdown – flooded into the tech mergers and acquisitions market.
Already in the second month of 2021, the appetite for M&A shows no signs of slowing. See our slideshow above to see which recent deals have made headlines, most notably in the MSP community.