|By Kevin Dee, Co-Founder of Eagle|
This is my 30,000 foot look at events in the Tech industry for December 2020. What you see here is a précis of the monthly report I produce, which will be available in more detail at the News section of the Eagle website, where you will also find back issues.
A Little History of previous year’s Decembers …
Five years ago, in December 2015 M&A was quiet but there was some interesting activity. The big deal saw Canadian telco Shaw make a big play into the cellular space with its proposed acquisition (subsequently approved) of Wind for $1.6 billion. Meanwhile Rogers was also out shopping and growing its Maritimes presence through the acquisition of Internetworking Atlantic Inc. Other deals in December were not large but did feature some of the big players. Oracle bought Stackhouse a cloud company with a specialization in “containers”; IBM boosted its video in the cloud capabilities with the purchase of Clearleap; and Microsoft picked up a mobile communications company, Talko. Other deals saw Ingram Micro buy the Odin Service Automation business from Parallels and in the storage world Carbonite bought Evault from Seagate.
Four years ago in December 2016 Adecco sold its majority stake in Beeline VMS to GTRC, a private equity firm, for $100 million in cash plus a $30 million note; CRN solution provider SS&C purchased asset service firm Conifer for $88.5 million; solution provider QRX Technology Group acquired IT equipment provider Kerr Norton; networking solution provider, Juniper Networks acquired cloud operations management provider AppFormix; Uber bought start-up Geometric Intelligence Inc.; and Shopify acquired Tiny Hearts, a Toronto-based mobile product development studio.
December 2017 saw Atos enhance the footprint of their IT Services firm by paying $5 billion for Gemalto. Apple were busy, paying $400 million for music recognition app Shazam, plus they invested $390 million into optical communications components company Finisar. Finally, in a relatively quiet M&A month Ingram Micro increased its data protection capability through the purchase of Cloud Harmonics.
Two years ago, in December 2018 IBM sold off a portion of their software portfolio to HCL for $1.8 billion. Cisco paid $660 million for optical chip company, Luxtera; and OpenText paid $310 million for data management company Liaison Technologies. In other deals, Google bought “where is my train” app company, Sigmoid Labs; Corel bought desktop virtualization company Parallels; Trello bought Butler, whose product is a popular addition for Trello users; Kaseya bought IT documentation company IT Glue; and GE continued its restructuring efforts by spinning out its IoT subsidiary and selling its interest in Pivotal. Finally the end of December was the beginning of Dell’s return as a public company.
Last year, December 2019 saw some big dollar deals in the M&A world with the biggest seeing LogMeIn sold to private equity for $4.3 billion. Intel shelled out $2 billion for AI chip company Habana Labs; and F5 Networks paid $1 billion for Shape Security. In other deals Solarwinds paid $175 million for VividCortex; NTT picked up AWS company Flux7; Fortinet bought Cybersponse; CheckPoint Software bought security company Protego; Acronis bought security company 5nine and Opswat bought cyber security company Impulse.
Which brings us back to the present …
In December 2020 the pandemic continues to dominate news, and with vaccines approved and beginning to roll out there is cause for some optimism but that Is going to take time. Meanwhile increasing spread, and mutated strains of the virus are causing concerns. When coupled with the current political upheaval in the US, small positive economic and job data indicators are not great indicators of where the economy really stands. Lockdowns are only going to continue and the impact on small businesses continues to be devastating. It remains to be seen what happens in the US and what the fallout will be on the markets and the economy in general.
It was an active month in M&A and some very big deals were announced. The $27.7 billion acquisition of collaboration software company Slack, by Salesforce was certainly an eye opener; Platinum Equity paid $7.2 billion for Ingram Micro; Self driving startup Aurora is paying reputedly $4 billion for Uber’s Advanced Tech Group; and Google is reputedly paying $1 billion for data protection company Actifio.
There were a lot more deals too. Hyundai’s robotics arm paid $921 million for Boston Dynamics, owner of Spot, the robot; Cisco bought two companies, paying $730 million for contact center as a service company IMImobile and also picking up audience interaction tech company Slido; NortonLifeLock paid $360 million for cybersecurity company Avira; And Facebook is buying customer relationship management company Kustomer.
There were some other big names out buying, including ServiceNow picking up Canadian darling AI company Element AI; IBM bought another Canadian company in the Fintech space, Expertus; Juniper Networks bought a startup, in the network space, Apstra ; Fortinet bought network tools company Panopta; RingCentral picked up AI comms company DeepAffects; Storage company Quantum bought media storage company Square Box Systems; and Goldman Sachs bought fraud detection system White Ops.
Cybersecurity continues to a be big news, with McAfee suggesting losses from cyber crime in 2020 were $945 billion, doubling the amount in just two years. The breach of FireEye by a “state sponsored” hacker does little to help, given this was essentially a case of the best of the best being breached!
That’s my look at the tech industry for December 2020. The full edition will be available soon on the Eagle website. Until next month Walk Fast and Smile … don’t forget to be safe, wear a mask, wash your hands and socially distance. We will get through this together! Let’s hope for a much better year in 2021.