Rapid evolutions in technology, in particular the adoption of AI and the robotisation across all industries, are forcing companies to forge more strategic combinations.
According to Deloitte’s survey “The state of the deal M&A trends 2018”, based on the consultation of 1,000 executives at corporations and private equity firms, Technology Acquisition (TA) is the new No. 1 driver of M&A pursuits, ahead of expanding customer bases in existing markets, or adding to products or services. Acquiring technology or a digital strategy accounted for about a third of all deals being pursued.
Looking ahead as new high profile data leaks continue to hit headlines, and amidst a political climate dominated by accusations of election hackings and cybercrime, internet security specialists will continue to be sought after assets. We’re certain to see more deals like Microsoft’s €84m (c.£74m) purchase of Hexadite. Meanwhile 2017 saw €18bn (c.£16bn) invested in M&A in AI, 26 times more than in 2016.
Read the original article on: TMT Finance
Seeking additional earnings when organic growth is too slow
Many companies are seeking to increase earnings in an economic environment where organic growth may be improving but not fast enough. Deals are often still the best solution to that problem.
Source: Financial Times, Friday 29 June 2018 - Big-ticket deals spur record global M&A boom
With a significant portion of majority owners and directors nearing the retirement age over the next two decades, succession planning is an ever-pressing issue that often times gets overlooked.
Disposing of the business interests can cover one or a combination of the following options:
Transferring the interests on to members of the owner’s family
Selling share in the business to co-owners or partners
Selling the business to a third party
Public flotation or sale to a public company
Selling the business to the management or entire workforce
All these cases represent a highly sensitive change for the firm which need to be properly analysed, selected, structured and implemented based on key strategic objectives and interests of the key stakeholders: existing owners, management, employees and clients.