Black and White Program

PricewaterhouseCoopers report indicates value of acquisition deals up

September 10th, 2012 by Black and White Program Staff

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A report from worldwide tax and advisory consulting firm PricewaterhouseCoopers (PWC) indicates that technology companies focused more on spending large acquisition amounts in 2011 than on smaller deals, while trying to grow their own firms. The report attributes large cash positions and landscape shifts as reasons for the trend.

Analysis indicates that tech firms spent $125 billion on deals in 2011, an increase of 17 percent over 2010 when $107 billion was invested. In terms of transactions for new deals, a 21 percent decline was apparent from the prior year, with 308 deals, revealing more funds were spent on a lower number of deals.

A number of transactions contributed significantly to growth in the average deal size, such as Hewlett-Packard’s (HP) $10.3 billion purchase of Autonomy, Intel’s $6.6 billion acquisition of McAfee, and Texas Instrument’s $6.4 billion pickup of National Semiconductor. Google’s $12.5 billion purchase of Motorola Mobility, expected to close in 2012, may continue to push the trend forward.

Data regarding Software acquisitions indicated growth for the second year in a row.
Reports indicate acquisitions totaled $438 million in 2011, up 49 percent from $294 million in 2010. Emerging areas included security, big data, social networking and online gaming.

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