IDC Finds 2010 to be a Turnaround Year for M&A Activity in the Technology Sector with Deal Volume and Valuation on the Rise

©IDG Communications, Inc. Photo contributed by Matthew Mikaelian.

IDC Press Release, 3/28/11

Merger and acquisition (M&A) activity in the information and communications technology (ICT) sector made a strong recovery in 2010 as the global economy and IT spending rebounded from the recession of 2008-2009. According to a new International Data Corporation (IDC) report, there were more than 1,900 M&A deals in the ICT sector in 2010 with a total valuation of over $200 billion.

The vast majority of M&A deals in 2010 were concentrated in application-related areas, including enterprise applications (586 deals) and Internet applications (421 deals). Activity also surged in the infrastructure segment where there were more than 219 deals led by strong interest in security and storage companies.

From a valuation perspective, the telecommunications segment was particularly active in 2010 with seven of the year’s top 10 megadeals involving service provider networks. Among these megadeals was CenturyLink’s acquisition of Qwest for $22.4 billion and América Móvil’s $21 billion deal for Telemex. Intel’s $7.7 billion deal for McAfee and SAP’s acquisition of Sybase ($5.8 billion) were the largest megadeals in the infrastructure segment.

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