This is my 30,000 foot look at events in the ICT industry for August 2015. What you see here is a précis of the monthly report I produce, which will be available in more detail at the News section of the Eagle website, where you will also find back issues.
A Little History of August in previous years …
Five years ago in August 2010 Google made five acquisitions … Socialdeck, Angstro, Slide, Jambool and Like.com, but Intel spent the most money … paying $7.7 billion for McAfee AND $1.4 billion for Infinion Technology’s wireless division! IBM bought Datacap and Unica Corp; HP bought Fortify Software and Stratavia; 3M paid $900 million for Cogent; CA paid $200 million for Arcot Systems; and Rim, Cisco, Citrix and Nokia were all out shopping too! In addition to their two acquisitions HP lost CEO Mark Hurd to a scandal.
Three years ago in August 2011 Hurricane Irene hit the US coast, there was a mini-market crash and the world’s economies continued to struggle. Google paid $12.5 billion for Motorola Mobility and IBM paid $387 million to add Algorithmics to its analytics portfolio, they also bought UK based analytics company i2. Skype which was in the process of being merged into Microsoft, bought GroupMe, Bitly bought Twitterfeed and Citrix bought Ringcube.
August 2012 was slow in the M&A space with IBM busiest, paying $1.3 billion for HR solutions and services company Kenexa, plus they bought flash memory developer, Texas Memory Systems. The other “big name” deal was Google’s purchase of social media marketing company Wildfire Interactive, reputedly for $250 million. Closer to home, Quebec’s 20-20 Technologies was sold for $77 million to private equity company Vector Capital Corp.
Last year August 2013 saw some interesting activity from a number of players. At a time when employee engagement is considered critical, it was disheartening to see Cisco announce record profits and lay off 4,000 people at the same time. IBM reputedly paid $1 billion for Trusteer, a cybersecurity company specialized in the financial services sector; Qualcomm sold its fleet management software unit for $800 million to private equity firm Vista Equity Partners; and the other big dollar buy was AOL paying $405 million for online video company Adap.tv. Facebook bought speech recognition company Mobile Technology; Google bought patents to support its Glass product from Foxconn; Software AG bought analytics firm Jackbe; Opentext paid $33 million for cloud based software company Cordys; and SAP bought ecommerce company Hybris.
Last year in August 2014 there were no blockbuster deals, however a number of big name companies were out with their cheque books. Intel paid $650 million for the LSI Axxia networking chip business; Vmware bought application delivery provider CloudVolumes; IBM bought Lighthouse Security Group to bolster its cloud based identity and access management capabilities; Google bought two startups, Emu to boost its messaging capabilities and Directr for its video advertising business; Facebook bought a security startup Privatecore, and the last BIG name saw Yahoo buying app company Zofari. It appears that the big companies keep getting bigger, which is the way that the business world works!
Which brings us back to the present …
August 2015 was an exceptionally slow month in the M&A space however there were two billion dollar deals. Symantec sold Veritas (which it paid $13.5 Billion dollars for 10 years ago) to a group of investors for $8 Billion. IBM also paid ”big bucks”, shelling out $1 billion for Merge Healthcare. A small deal saw Calgary based Above Security bought by Hitachi; Transcomos bout 30% of Vietnamese daily deals site Hotdeal; Freshdesk bought live-chat company 1Click; and PLDT bought ecommerce startup Paywhere.
Other companies in the news were HTC for laying off 2,250 people and Lenovo who laid off 3,200 people. Both companies struggling in the hyper-competitive smartphone space.
On the economic front there is much debate about Canada’s latest “recession” following reports of two consecutive quarters of negative GDP growth. Certainly the West is suffering because of the price of oil however Canada is still adding jobs and consumers are spending. There is no panic, but it certainly isn’t the US, which seems to be going from strength to strength. Almost every indicator there was positive again this month, and another 185,000 jobs added! (Note: By the time you read this the August figures may have been released, so bear in mind this update is based on July numbers released in August.)
That’s what caught my eye over the last month, the full edition will be available soon on the Eagle website. Hope this was useful and I’ll be back with the September 2015 industry news in just about a month’s time.
Walk Fast and Smile!