Long-term outlook for technology M&A remains strong
TORONTO, March 6, 2013 /CNW/ - Despite flatlining global technology
mergers and acquisitions (M&A) volume year over year in 2012, Canadian
volume was up 21% according to Ernst & Young's Global technology M&A update.
"Canada's deal volume was very heavily weighted towards Q2 in 2012,
during which time 84% of transaction volume for the year was recorded
as the result of two mega-deals," says Tony Ianni, Transaction Advisory
Services partner at Ernst & Young. "But globally, companies were
hesitant to engage in large, transformative deals in 2012."
The report highlights that risks such as incorrect valuation were top of
mind as equities markets fluctuated and buyers believed many company
values remained high. But deal volume held steady as macroeconomic
pressures forced companies to clarify what's important.
"Both technology and non-technology sectors are continuing to learn how
to harness new technology megatrends like smart mobility, cloud
computing, social networking and big data analytics," adds Ianni.
"Technology companies are rapidly adapting to the needs of specific
industries, while other industries are looking to take advantage of the
evolving possibilities that technology enables. That will continue to
drive smaller, more strategic deals."
Despite continued macroeconomic uncertainty, the results of the report
indicate there continues to be a broad-based need for transactions that
help companies accelerate their adaptation to transformative
"These technology megatrends are shaping and driving business in
virtually every sector," says Martin Lundie, partner and Canadian Media
and Entertainment leader at Ernst & Young. "All businesses should
really be taking a good look at where and how these trends are already
affecting their business, and examine how they can make the most of
these trends to grow."
Ernst & Young is a platinum sponsor of Dx3, a conference taking place in
Toronto this week that brings together technology providers and digital
buyers for networking and business opportunities.
"It's an exciting time for Canadian businesses that are both creating
and using new technologies," adds Lundie. "You never know what kind of
innovation or deals are sparked when you bring people and businesses
together to share ideas at conferences like Dx3."
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SOURCE: Ernst & Young
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