IT Industry News
April 2013 saw some interesting M&A activity with Rogers paying $200 million for Primus's Blackiron subsidiary, including datacenter capability; Toronto based Softchoice also chose to go private in a $412 million private equity deal; Shaw paid $225 million for an Enmax fibre network subsidiary in Calgary; Best Buy sold its stake in Carphone Warehouse for $775 million (having paid $2.1 billion in 2008). Google has spent $291 million on acquisitions in the first quarter including a $30 million purchase of social company Wavii. Other big names on the acquisition trail this month include Intel (Mashery), IBM (Urbancode); Computer Associates (Nolio). Finally Facebook had a couple of small acquisitions Osmeta and Parse. In other news this month, Canada's Temporary Foreign Worker program received some bad press and subsequent changes, Ray Lane stepped down from HP's board and IBM is investing $1 billion in flash data technology. PC shipments were down more than 11% year over year, smartphones, however, are up 30% with Samsung enjoying good growth. China was identified as the number one source of malicious computer attacks with the US second. The economic indicators were mixed, with confidence up in Canada despite an increase in the unemployment rate and lost jobs. There were a number of positive indicators out of the US including increases in jobs, GDP, CEO confidence and the leading economic index. E&Y also suggested 90% of US executives viewed the global economy as improved or stable.
March 2013 continued a trend for the first quarter of 2013 with a fairly lackluster M&A market. Some of the usual characters were making acquisitions, but there were no billion dollar deals announced. Oracle continued its move into the telco space with the purchase of Tekelec; Google bought a small Toronto Uiversity based company DNNresearch in the machine learning vertical; Microsoft sold a division to Facebook . Atlas Advertiser Suite will assist Facebook clients in managing marketing campaigns; Yahoo made its 5th small acquisition, this one Summly, was founded by a 15 year old two years ago (he was born after Yahoo was started). There were a couple more smaller deals but it was interesting to see both the Ontario provincial government and the Canadian federal government getting more active in funding startups! Outside of the M&A activity, both IDC and Gartner are predicting growth in the IT markets for 2013 - somewhere between 4% and 6%. There were also a number of indicators that the economy is improving: added jobs in both Canada and the US, several positive confidence indices, some increase in small business employment and a continued increase in US tech jobs. Microsoft ran into some difficulties in the EU, having to pay a $732 million antitrust fine related to Internet Explorer. Final word goes to Evernote who suffered a security breach affecting 50 million users.February 2013
February 2013 saw Dell go private in a $24.4 billion deal, that included a $2 billion investment by Microsoft. Oracle paid $1.7 billion for networking company Acme Packet Inc.; Rackspace bought big data company ObjectRocket; Telus was busy with two acquisitions: electronic medical records division of the Canadian Medical Association and digital forensics company Digital Wyzdom; HP also sold the Palm operating system to LG, for their smart TVs. A couple of reports about venture capitalism in Canada were positive, one suggesting Canada is third in the world for activity, behind only the US and UK. The second report suggests investment is on pace for a strong year. Both are good news in an environment where entrepreneurs bemoan the lack of available funding in Canada. In other news, the hacker regroup Anonymous continues to make political statements with hacks in the US government and the financial services industry. This month they posted details of 4,000 American bank executives. Here in Canada, a backlash against new internet legislation saw the cancelling of Bill C-30 because of privacy concerns. Canadian employment fell in January, but in that interesting statistical world the unemployment rate also fell to 7%. There were several positive indicators in the US economy including a growth in GDP, increase in IT jobs, and a couple of indexes showing increased confidence.January 2013
January 2013 was a big month for Canadian darling Research in Motion with the long awaited release of its next generation PDA and associated software. In M&A activity, Cisco was busy picking up yet another Israeli company, mobile network software company Intucell for $475 million. Cisco is investing heavily in Israel, with this being its 10th acquisition there in the last 12 years. Cisco also sold its Linksys division to Belkin. The biggest dollar value deal was AT&T's purchase of some of Verison Wireless's airwaves for $1.9 billion. Other deals saw NCR buy video software ASTM company uGenius Technology; Canon Canada acquired long-time partner and document management company Oce Canada; NetSuite bought retail management systems company Retail Anywhere; and AVI-SPL bought Duocom-Duologik. The Canadian Federal Government also released details about how it would make $400 million available for startups.December 2012
December 2012 saw a fair amount of M&A activity with Oracle making two acquisitions, marketing automation company Eloqua ($871 million) and Dataraker which provides analytics for utilities companies. The big deal of the month saw Sprint pay $2.2 billion to take full control of cellular competitor Clearwire. Montreal-based Cogeco continues to build out its data centre capability, paying $635 million for Peer 1 Networks and NCR paid $635 million for retail software and services company Retalix. In the BYOD space, Citrix has bought mobile device management company Zenprise for $355 million. Finally, Redknee added 1200 employees and 130 new clients through the purchase of Nokia Siemens Business Support Network. Economic and labour market news was generally pessimistic around the world. Although Canada continues to have decent data, the US news seemed relatively positive. There were other pockets of good news in places like Ireland and non-EU European countries; however, the general message was gloom around the globe, including India, which has previously been a positive story.November 2012
November 2012 saw a slight increase in M&A activity over the previous three months, although Cisco alone might account for that with two significant "buys" - cloud infrastructure company Meraki ($1.2B) and cloud datacentre and software company Cloupia ($125M). There were some other big names out with the cheque books this month. Dell bought software tools company Gale Technologies, NCR bought retail software company Retalix ($650M), Cray bought software company Appro ($25M) and Sprint Nextel bought a chunk of US Cellular ($480M). Locally, Toronto based NexJ bought Broadstreet for $8.2 million. Unemployment remains a concern in most parts of the planet and Canada continues to be comparatively better off with a 7.4% unemployment rate, which remains steady from September. The US is showing some positive signs with IT job growth most months in the last year and up 2.8% year over year, in addition the US economy added 158,000 non-farm jobs in October and consumer confidence is up. Europe, on the other hand, reached a record high unemployment rate of 10.7% in October. Still lots of bad news there, but there were some positive signs from the UK and Ireland. In other news Paul Otellini, another industry veteran, announced he will be stepping down at Intel after 7 years as CEO. Apple and HTC buried the hatchet on their bitter patent battle, and came out with partnering opportunities! Final word goes to the demise of the Lotus name, which will soon be retired by IBM.