Tech M&A hits new peaks in 2021: A look at some key mergers

The technology landscape is set to change as these mergers unlock greater innovation potential

Despite disruptions, the show must go on for the technology industry. If the slew of commercial technology releases is anything to go by then the technology industry has been largely resilient to downbeat expectations. This strong showing by the tech industry has taken place amidst the backdrop of mergers and acquisitions taking place at a frenetic pace. Mergers and Acquisitions in 2021have been exciting as they have led to a new dimension of possibilities for businesses while increasing the scope of innovation. Increasing technological convergence across industries has also acted as a catalyst for some of these mergers and acquisitions that shall pave the way for exciting product and service launches in the near future.

According to statistics from Refinitiv, the total amount of completed and ongoing M&A agreements in 2021 has already surpassed the $3.59 trillion recorded in 2020.  The current year is expected to be in a similar vein when it comes to new M&A record deals taking place.

Research by PwC highlights that the first half of 2021 saw some of the largest merger and acquisition (M&A) deals in the technology, media, and telecommunications sector in the past five years, though nothing quite matched AMD’s $35 billion bid for Xilinx last year, or’s now-closed $27.7 billion acquisition of Slack. Based on insights from , we’ve listed some key tech acquisitions in 2021 that will have a significant impact on the technology landscape.

AT&T’s completion of its $43 billion deal with WarnerMedia and Discovery

AT&T has decided to merge its WarnerMedia unit with Discovery, which it bought three years ago for $85 billion, in order to compete with worldwide streaming services such as Netflix and Disney+.

[box type=”success” align=”” class=”” width=””]AT&T would get $43 billion in cash and debt instruments as part of the deal, while AT&T’s stockholders would receive shares representing 71 percent of the new business.[/box]

The remaining 29% of the new business would be owned by Discovery stockholders, according to a statement from the corporation. Subject to regulatory approval, the merger would bring together more than 100 worldwide brands under one global portfolio.

Microsoft acquires AI voice recognition company Nuance for $19.7bn

Nuance, a pioneer of conversational AI and cloud-based intelligence for healthcare providers, has agreed to be acquired by Microsoft. The transaction comes after a fruitful relationship between the two organisations, which began in early 2019.

The deal will see Microsoft acquire the firm for $56 per share, with the closing price valued at $19.7bn, inclusive of Nuance’s debt. In a company statement announcing the deal, Microsoft said that Mark Benjamin would remain CEO of Nuance, reporting to Scott Guthrie, executive vice-president of Cloud & AI at Microsoft. Mark Benjamin, the CEO of Nuance, will continue to report to Scott Guthrie, Microsoft’s senior vice-president of Cloud & AI. [box type=”info” align=”” class=”” width=””]Satya Nadella, Microsoft’s CEO, highlighted that AI is technology’s top goal and healthcare is its most pressing application. As Microsoft accelerates the expansion of Microsoft Cloud for Healthcare and Nuance, the company will emphasize on building powerful AI solutions for professionals to promote better decision-making.[/box]

Zoom acquires Five9 for $14.7bn

Zoom Video Communications announced intentions to buy cloud contact centre Five9 in an all-stock deal valued at over $14.7 billion in July.

In order to establish a customer engagement platform of the future, the two platforms have a similar objective of strengthening corporate communications platforms to better how companies communicate with their consumers. Zoom’s position with business clients will improve as a result of the purchase, and it will be able to accelerate its long-term growth opportunity. Five9 is a pioneer in cloud-based contact centre software, with a secure cloud contact centre that offers a full suite of easy-to-use apps across several channels.

Citrix acquires Wrike for $2.25 bn

Citrix Systems, a digital workplace platform, announced the all-cash purchase of Wrike, a collaborative work management software solution, in March 2021.On paper, the two firms appear to be an ideal fit when it comes to offering people-centric solutions in the workplace and the adoption of hybrid working environments.

Citrix stated that the platform will enable business clients and teams to securely access, communicate, and execute all forms of work in the most efficient and effective manner possible as a result of the purchase.

As technological adoption acquires a shimmering crescendo in a post-pandemic world, technological integration has become imperative for the digitally-driven post-pandemic landscape. The spike in M&A activity in the technology landscape is indicative of the rapid evolution of technologies and ancillary platforms to engender greater innovation and value-engineering.

The challenge for technology players today is the increased regulatory scrutiny, and overcoming innovation roadblocks owing to major markets espousing increased protectionism of technology assets.





Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of ET Edge Insights, its management, or its members

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