25 June 2020 |
Last year marked a slight decrease in global technology M&A activity from the blockbuster year that was 2018 – when SAP bought Qualtrics for $8 billion, IBM acquired Red Hat for a staggering $33 billion and Broadcom picked up CA Technologies for $18.9 billion in cash.
As of the end of Q3 2019, technology M&A deals worth $245 billion had been announced globally, marking a decrease of 25% year-on-year according to GlobalData.
Which mergers and acquisitions does 2020 have in store? If January alone is anything to go by, there will be no slowing of major deals across the industry, with security already proving to be a hot area.
Here are the biggest technology acquisitions of 2020 so far, in reverse chronological order:
June: Mastercard to acquire open banking firm Finicity
Mastercard announced in June that it is acquiring Finicity for $825 million.
The Utah-based fintech specialises in open banking – a new regulation-driven mode of banking which is further ahead in Europe than the US – where consumers are given greater control of their finances by leveraging secure APIs to connect their bank account to other fintech services and make quick payments, without using traditional middle men, like Mastercard.
What Finicity provides is a platform that enables financial institutions to connect these data streams to a wide range of financial institutions and credit-decisioning bodies, without having to do the ‘plumbing’ themselves. Notable clients include FICO and Experian.
Analysts noted a similarity in the deal to Visa’s recent purchase of Plaid for $5.3 billion (see below).
June: Microsoft acquires CyberX
Microsoft announced the acquisition of Israeli IoT security specialists CyberX in June for an undisclosed amount. Microsoft will incorporate CyberX technology and talent into its cloud Azure unit, where it already offers the Azure IoT stack, Azure Security Center for IoT and Azure Sentinel. The CyberX team will now report in to fellow Israeli Yuval Eldar, Microsoft GM of IoT Security.
Founded in 2013, CyberX allows customers to manage and improve the security of their IoT assets, be that a set of autonomous robots on a factory floor or a fleet of consumer-facing smart doorbells. Existing clients include major oil and gas utilities, as well as US government agencies like the Department of Energy.
May: Cisco acquires ThousandEyes
Cisco announced its intention to acquire network intelligence specialist ThousandEyes in May for an undisclosed amount.
San Francisco-based ThousandEyes sells cloud-based analytics tools for the internet, local and wide-area networks. The company also tracks ISP, cloud and collaboration application performance.
May: Microsoft acquires Softomotive
Microsoft announced the acquisition of UK-based provider of robotic process automation software Softomotive in May for an undisclosed amount. Softomotive talent and technology – specifically its desktop automation tool WinAutomation – will be folded into Microsoft’s Power Automate platform.
Founded in 2005 by Greek entrepreneurs Argyris Kaninis and Marios Stavropoulos, Softomotive has thousands of customers across the healthcare, banking, insurance, and telecom industries.
May: Facebook buys Giphy for $400m
Facebook announced on 15 May that it was to buy Giphy, the popular searchable library for movable images, or gifs. The product and team will be rolled into the Instagram division of the social media giant. The price for the acquisition was pegged at $400 million by Axios, which broke the story.
“Giphy makes everyday conversations more entertaining, and so we plan to further integrate their GIF library into Instagram and our other apps so that people can find just the right way to express themselves,” Vishal Shah, VP of product wrote in a blog post, in which he also referred to Giphy as a “leader in visual expression and creation”.
Shah also revealed that 50% of Giphy traffic already comes via the Facebook family of apps, half of that from Instagram itself.
May: Microsoft to acquire Metaswitch Networks
Microsoft announced the acquisition of the UK-based firm Metaswitch Networks in May for an undisclosed amount.
This marks another move into the nascent 5G market by Microsoft, as Metaswitch specialises in virtualised, cloud-based communications software. The buy-out follows the acquisition of another 5G-focused company – Affirmed Networks – by Microsoft earlier this year.
May: VMware to acquire Octarine
The virtualisation specialist VMware announced its intention to acquire Octarine for an undisclosed amount in May.
The California-based start-up specialises in securing applications running on the popular open source Kubernetes container orchestration platform. VMware will immediately fold the Ocatrine team and technology into its cybersecurity unit Carbon Black, which it acquired last year for $2.1 billion.
May: Atlassian acquires help desk firm Halp
Atlassian announced it is acquiring helpdesk software-maker Halp in May.
Halp allows technology teams to assign, prioritise and answer requests directly from Slack. It already integrates with Atlassian’s Jira Service Desk and Confluence, allowing organisations to keep records of tickets via their support tool of choice. Atlassian says it will maintain Halp as a standalone brand and team post-acquisition.
May: Zoom acquires encryption specialist Keybase
Zoom announced the acquisition of secure messaging specialist Keybase in May for an undisclosed amount.
The popular videoconferencing application has come under intense scrutiny during the global lockdown as a result of the COVID-19 pandemic, including various slights against its security credentials. CEO Eric Yuan quickly announced a 90-day plan to address these customer concerns, and this acquisition is being positioned as part of that response.
Keybase specialises in end-to-end encryption, a cryptography method which ensures that communications are encrypted at each end of the line, meaning the content can’t be seen or heard by anyone outside of the parties involved, including the vendor itself. The service was designed in New York by OK Cupid cofounders Chris Coyne and Max Krohn, who will subsequently lead the Zoom security engineering team, reporting directly to Yuan.
May: Sinch acquires SAP Digital Interconnect for £198m
The Swedish cloud communications company Sinch picked up SAP’s mobile unit SAP Digital Interconnect (SDI) for £198 million in cash in May.
Sinch is similar to the US company Twilio in that it offers a suite of embedded communications options for messaging, voice and video via a set of APIs. SAP’s Digital Interconnect unit, which it has been shopping around for a number of weeks, is therefore a clear fit for the firm, as it provides a similar suite of products to an existing customer base of 1,500 businesses.
May: Intel acquires Israeli Start-up Moovit for $1b
Intel confirmed that it is acquiring Israeli mobility data specialist and journey planner app Moovit on 4 May for $900 million. The chipmaker will look to bring Moovit into its Mobileye mobility unit, which the chipmaker also acquired, for $15.3 billion in 2017. Mobileye provides driver assistance software to 60 million vehicles today and is also working on autonomous vehicle technology, where it will seemingly be able to leverage Moovit’s wealth of mobility data.
Founded in Tel Aviv in 2012, Moovit provides real-time traffic data to third parties like ride-hailing services and transit authorities through its popular mobile app. Intel was a strategic investor in the start-up prior to this acquisition.
May: NVIDIA buys Mellanox, Cumulus in multi-billion spree
Chipmaker NVIDIA made two acquisitions in close succession this spring: Cumulus Networks for an undisclosed amount on 4 May and cloud-network switch and adapter vendor Mellanox, which was announced on 27 April in a $6.9 billion deal.
Cumulus specialises in a Linux-based network operating system for large data-centre, cloud and enterprise environments. Mellanox specialises in networking hardware and software for large cloud and enterprise data centres, including high-speed interconnectivity for high-performance computing. All three companies have partnered on solutions in the past.
April: Verizon to acquire BlueJeans
The business arm of US telco Verizon announced that it has entered into a definitive agreement to buy the enterprise video conferencing company BlueJeans on 16 April, for less than $500 million according to the Wall Street Journal.
The acquisition of the Zoom and Cisco WebEx rival platform was announced at the height of the global COVID-19 pandemic, which forced unprecedented numbers of people to turn to video calling platforms like BlueJeans.
Verizon announced that it is looking to bring BlueJeans into its communications-as-a-business portfolio and is already eyeing integrations with its 5G product roadmap, especially to provide solutions in the telemedicine, distance learning and field service spaces.
April: Cisco acquires Fluidmesh
Cisco announced in April that it will acquire the wireless backhaul specialist Fluidmesh Networks for an undisclosed amount.
The MIT and Polytechnic University of Milan spin-out company specialises in technology which enables reliable connections between sensors on fast-moving objects, such as trains, remote vehicles, and robotic manufacturing machinery. Cisco will hope the acquisition can boost its industrial internet of things (IIoT) portfolio. The two companies know each other well, having already partnered on Cisco’s Connected Rail Solutions product.
April: Accenture buys Revolutionary Security
Accenture made its third cybersecurity buy of the year with the purchase of Philadelphia-based consultancy Revolutionary Security in April. Founded in 2016, Revolutionary Security focuses on cybersecurity consultancy services, from penetration testing to insider threat mitigation and threat hunting, and counts around 90 employees.
This marks the third cybersecurity acquisition by Accenture this year already, having picked up Symantec’s security services division in January and Context Information Security in March.
April: SoFi acquires Galileo for $1.2b
The fintech bubble shows no sign of bursting in the early days of the COVID-19 pandemic, as SoftBank-backed SoFi announced in April that it plans to buy Utah-based payments firm Galileo for $1.2 billion in stock and cash.
Galileo powers payments for various other fintech firms, such as stock trading app Robinhood and London-based money transfer service TransferWise.
This marks the San Francisco-based SoFi’s ambitions to build a catch-all fintech company, having started in 2011 with online-only student loans and since moving into everything from cryptocurrency to mortgages, personal loans and stock trading since.
April: CNN acquires Canopy
CNN, which is owned by media giant Turner, is in the process of acquiring digital news service Canopy for an undisclosed amount.
Based in Brooklyn and Boston, Canopy specialises in content personalisation, using human curation and machine learning algorithms. The app itself will be wound down as a result of the acquisition to better focus on delivering a similar product for its new parent company, according to TechCrunch.
March: Microsoft to acquire Affirmed Networks
Microsoft announced that it is acquiring the Boston-based Affirmed Networks for an undisclosed amount in March. The 2010-founded company specialises in virtualisation and cloud-based mobile network technology, which makes it an attractive acquisition target for any company investing in next-generation 5G connectivity.
March: BMC Software to acquire Compuware
Enterprise software stalwart BMC agreed to buy Compuware in March for an undisclosed amount, marking its third purchase of a mainframe specialist in just over a year.
The deal signals further consolidation of the mainframe support and services vendor landscape, as BMC has bought up RSM Partners and CorreLog in the past year or so, following an injection of cash when it was acquired itself by private equity firm KKR in 2018.
March: DocusSign acquires Seal Software for $188m
E-signature specialist DocuSign has announced it is acquiring Seal Software for $188 million in cash. Seal, which is based in northern California, has built machine learning-enabled analytics software specifically for contracts, allowing organisations to search through large volumes of agreements by legal concepts, instead of keywords.
DocuSign made a $15 million strategic investment in the firm last year and has signalled its intention to tightly integrate its machine learning-powered application into its Agreement Cloud software.
February: Intuit to acquire Credit Karma
US software maker Intuit – best known for its QuickBooks, Mint and TurboTax products – announced its intention to acquire fellow Silicon Valley-native company and rival Credit Karma in a $7.1 billion deal in February.
Through the acquisition, Intuit is looking to build an all-in-one financial assistant for customers, combining income, spending and credit histories, complete with financial product offers and personalised advice.
February: Salesforce acquires Vlocity for $1.33b
CRM giant Salesforce made its first acquisition of 2020 in February, picking up the San Francisco-based company for $1.33 billion. It’s a straightforward fit for the SaaS company, as Vlocity is a key partner and specialises in building industry-specific CRMs on top of Salesforce for companies in the media, financial services, health, energy and utilities sectors, as well as public sector and nonprofits. Salesforce had already invested in the company through its ventures arm in 2019.
Salesforce has long been interested in vertical specificity as it looks to embed its software deeper with large enterprise clients and has launched several of its own targeted solutions for industries with Financial Services Cloud and Manufacturing Cloud.
February: Morgan Stanley to acquire ETrade for $13b
American investment bank Morgan Stanley made a splashy acquisition in February, picking up online brokerage ETrade for $13 billion.
Morgan Stanley is hoping that the acquisition can help boost its wealth management division by attracting younger, less affluent customers thanks to the lower margins associated with digital wealth management solutions, including robo advice and commission-free trading like that popularised by start-ups Robinhood in the US and Nutmeg in the UK.
Founded in 1982 and based in Silicon Valley, ETrade specialises in electronic trading of financial instruments, from common stocks to exchange-traded funds (ETFs).
February: Dialog Semiconductor acquires Adesto Technologies
UK-based Dialog Semiconductor acquired Adesto Technologies for $500 million in February. The California-based chip maker specialises in System-on-Chips (SoCs), edge router, network interfaces and resistive RAM technologies, with a specific focus on industrial IoT.
Just four months earlier Dialog also acquired German fabless chip firm Creative Chips GmbH for $80 million.
February: Facebook takes majority control of Scape Technologies
Facebook surpassed a 75 percent majority share in London-based computer vision start-up Scape Technologies in February. TechCrunch pegs the value of the deal at around $40 million. Scape’s existing backers included Entrepreneur First (EF), where the company was formed, along with VC firms LocalGlobe, Mosaic Ventures, and Fly Ventures.
Scape has built a developer kit that can combine imagery, latitude and longitude data to determine the location of a device to a higher degree of accuracy than GPS.
February: Koch Industries acquires remaining Infor stake
It was announced in February that the massive multinational Koch Industries had acquired the remaining equity stake in the software vendor Infor. The deal values Infor at $11 billion, or nearly $13 billion including preferred shares, according to Bloomberg. Koch has been an investor in the vendor since 2017 and reportedly held as much as a 70 percent stake before this deal. This will halt any rumours of an IPO for Infor.
Infor specialises in enterprise resource planning (ERP) software, particularly focused on industry verticals and increasingly, shifting to the cloud with its CloudSuites product. It competes with the likes of Oracle, Microsoft and SAP and has a solid, loyal customer base, many of which, however, are still on-premises.
February: Accenture acquires data consultancy Mudano
Accenture announced in February that it is acquiring UK-based data consultancy Mudano for an undisclosed amount. The firm will join Accenture’s Applied Intelligence unit, which has been on an acquisition binge as of late, acquiring the likes of Clarity Insights, Pragsis Bidoop in Spain and Analytics8 in Australia in the past
Founded in 2014, Mudano has offices across the UK and its clients tend to be in the financial services sector.
January: ServiceNow acquires Loom Systems
ServiceNow is looking to accelerate its ability to deliver AIOps with the acquisition of Israeli start-up Loom Systems for an undisclosed amount.
The SaaS giant is looking to deliver on the promise of AIOps, a model of IT where artificial intelligence techniques are leveraged to help predict and prevent issues from occurring, instead of reacting to service desk requests.
January: Apple acquires Xnor.ai for $200m
Apple acquired Seattle-based Xnor.ai for a reported $200 million in January, according to TechCrunch.
The start-up was spun out of the nonprofit Allen Institute for AI (AI2) in 2017 and specialises in machine learning and image recognition algorithms and techniques which work locally on the device.
January: Google Cloud acquires AppSheet
Google Cloud announced the acquisition of AppSheet in January for an undisclosed amount. The Seattle-based start-up specialises in no code software development, allowing customers to build simple business applications without having to know how to write code.
AppSheet was founded by Praveen Seshadri and his old Cornell student Brian Sabino in 2014 and had secured a modest $18.5 million in funding to date, so it is safe to assume this wasn’t a blockbuster acquisition by the cloud vendor but it does fit with the company’s broader desire to democratise application development.
January: Visa to acquire Plaid for $5.3b
Payments giant Visa has announced that it will be acquiring the fintech start-up Plaid for $5.3 billion in cash.
The San Francisco-based start-up has built what is essentially an identity layer which can seamlessly link together customer’s bank accounts with popular fintech apps like TransferWise or Venmo via a set of secure APIs.
The $5.3 billion price tag will raise some eyebrows as it represents a steep premium on its last private valuation of nearer $2.65 billion, following a $250 million Series C funding round in December 2018, of which Visa and its rival Mastercard were also investors.
January: Insight Partners to acquire Veeam for $5b
Private equity firm Insight Partners announced that it is purchasing the Swiss data management specialist Veeam for approximately $5 billion in January. Insight had invested $500 million in the firm last year.
Under Insight the vendor will become a US company under the leadership of new CEO William Largent, having previously held the role of executive vice president of operations. Danny Allan has also been promoted to CTO from vice president of product strategy.
January: Appian acquires RPA vendor Novayre Solutions
Low-code app development specialist Appian announced its first ever acquisition, snapping up Spanish robotic process automation (RPA) specialist Novayre Solutions SL in January for an undisclosed amount.
Essentially Appian wants to combine its low-code development capabilities with the ability to program software bots to automatically complete simple business tasks in one platform.
January: Accenture acquires Symnatec’s cyber cecurity services
Professional services giant Accenture agreed to acquire Symnatec’s Cyber Security Services business from Broadcom for an undisclosed amount in January. That business unit and its 300 employees will be folded into Accenture’s own security practice, including its global threat monitoring and analysis capabilities, its global network of security operation centres and various threat intelligence and incident response services.
January: Insight Partners acquires Armis
Just three days before snapping up Veeam, Insight had already put pen to paper on the $1.1 billion acquisition of Israeli cybersecurity firm Armis. Google’s capital arm CapitalG is also contributing $100 million to the deal, as well as some existing stockholders. The start-up had raised $112 million to date, with Insight being a previous investor.
Founded in 2015 by Yevgeny Dibrov, Tomer Schwartz, and Nadir Izrael and now based in California, the vendor specialises in “agentless” IoT security, allowing enterprises to manage and control their device fleets securely. Dibrov and Izrael will continue to lead the company under Insight’s ownership as CEO and CTO, respectively.
IDG News Service