|By Kevin Dee, Chairman of the Board at Eagle|
This is my 30,000 foot look at events in the Tech industry for April 2019.
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 Aprils …
Five years ago, in April 2014 Microsoft officially entered the handset business with the completion of the $7.5 billion purchase of Nokia’s devices business. Zebra Technologies paid $3.5 billion for Motorola’s unit that makes mobile devices for business which is a move in the ever-expanding Internet of Things space. Apple paid $479 million purchase of the LCD chip development unit of Renesas Electronics. IBM snapped up marketing automation software company Silverpop Systems and open source software company Red Hat paid $175 million for storage company Inktank.
In April 2015 Nokia was the biggest story, paying $16.5 billion for telecom company Alcatel-Lucent, but there was also a $4 billion deal that saw Capgemini buy services firm IGATE and LinkedIn made its largest acquisition ever, paying $1.5 billion for training portal Lynda.com. LinkedIn also bought a predictive insights startup company, Refresh. Netsuite paid $200 million for ERP and commerce software company Bronto Software and Blackberry reputedly shelled out $150 million for file sharing security company Watchdox. Salesforce was also out shopping, picking up mobile two-factor authentication startup, Toopher. In another deal involving billions, Informatica decided to follow in DELL’s footsteps and go private for a $5.3 billion price tag.
April 2016 saw some big deals, the biggest was Bell’s $3.8 billion bid for Manitoba Telephone System, which closed in 2017. Other large deal saw a Chinese conglomerate bid $3.6 billion for Lexmark; and Plantronics shell out $2 billion for Polycom. Oracle paid $663 million for cloud based construction software company Textura. Nokia, who were also in the news announcing layoffs, and continued to evolve their business model, this time into the wearable tech arena with the $192 million purchase of Withings. Other deals saw Autodesk acquire 3D animation software company Solid Angle; and Dimension Data bought Toronto based cloud services company Ceryx.
Two years ago in April 2017 Microsoft bought Israeli cloud-monitoring and analytics startup, Cloudyn. Flipkart, one of India’s larger ecommerce companies, acquired the Indian division of eBay (eBay.in) as part of eBay’s $500 million investment in Flipkart. VMware’s vCloud Air unit was acquired by OVH, a French hosting and cloud company. Global professional services provider, Accenture, purchased the UK-based automation services provider, Genfour. Toronto-based startup, Turnstyle Analytics, was acquired by Yelp for $20 million. California-based Coupa Software purchased Swedish software company, Trade Extensions for $45 million. Montreal-based financial technology provider, Alithya acquired big data solution provider, Systemware Innovation Corporation.
Last year April 2018 was not super busy on the M&A front although there were a few deals, including a $2 billion purchase of Ottawa based Mitel by Searchlight Partners, who will take the company private. Mobile payments company Square paid $365 million for website company Weebly; iconic photo site Flickr has been bought by SmugMug; Adobe acquired AI startup Uru; Indeed bought Canadian jobs site Workopolis; and HPE Pointnext bought Redpixie.
Which brings us back to the present …
April 2019 was an extremely slow M&A month with just two deals hitting my radar. Intel bought Omnitek, a company that produces programmable chips for the video space. This comes as Intel announced it was exiting the 5G modem space for smartphones, suggesting it was not a profitable business for them. The other deal saw the merger of two large US based MSPs, as Corsica bought EDTS to compete at the next level.
The general economic news was positive with the US continuing to soar with very low unemployment, rising wage rates, an annualised GDP growth rate of 3.2% in the first quarter all suggesting the US boom will continue for a while yet. Canada continus its anemic growth rate, projected at 1.2% this year. Around the world unemployment is generally down except for pockets like the UK where the Brexit situation continues to be a mill stone around their necks.