Global tech merger-and-acquisition deals totaled $634.1 billion in 2020, an increase of 91.8% year-on-year. Can 2021 match that for blockbuster activity?
Amid the coronavirus, 2020 was unpredictable in more ways than anyone would have expected. But one thing that stayed fairly constant was the steady flow of mergers and acquisitions (M&A) across the tech sector.
Global tech M&A deals last year totalled $634 billion, a 91.8% year-over-year increase, according to GlobalData. Among a late flurry of big deals was the $35 billion acquisition of Xilinx by Advanced Micro Devices and Salesforce’s $27.7 billion acquisition of Slack.
As for whether 2021 will maintain last year’s pace, if the first part of the year is anything to go by, there will be no slowing of big deals across the industry, with silicon innovations and collaboration software already proving to be hot areas.
Here are the biggest enterprise technology acquisitions of 2021 so far, in reverse chronological order:
May 10: ServiceNow acquires Lightstep
ServiceNow acquired software observability specialist Lightstep for an undisclosed amount. Observability is a hot technology area this year due to the increased complexity of enterprise systems in the cloud era, meaning engineers and tech leaders want more insight into how their systems are performing and what is causing issues — quickly. Post-acquisition, ServiceNow will look to bring these capabilities together with its existing tools, which are used by IT teams to respond to issues.
Founded in San Francisco by ex-Googlers, Lightstep had already raised around $70 million in venture funding from the likes of Sequoia, Redpoint, and Altimeter.
“This acquisition is going to help a great deal: ServiceNow’s customers run many of the most critical software applications in the world! As part of ServiceNow, Lightstep will be in a far better position to reach these customers, deliver our product, and help them innovate faster – with clarity and confidence,” Lightstep cofounder and CEO Ben Sigelman wrote in a blog post.
ServiceNow CEO Bill McDermott was an acquisitive chief during his time at SAP and appears to be taking this strategy with him in the new role, adding half a dozen new companies already since joining in 2019.
May 3: Dell sells Boomi for $4B
Dell made the second high-profile move to restructure its business in the space of a month by selling the integration specialist Boomi, which it acquired in 2010, to private equity firms Francisco Partners and TPG for $4 billion. This follows the earlier decision to spin out its VMware business in April.
“The ability to integrate and connect data and workflows across any combination of applications or domains is a critical business capability, and we strongly believe that Boomi is well positioned to help companies of all sizes turn data into their most valuable asset,” Francisco CEO Dipanjan Deb and partner Brian Decker said in a statement.
April 30: IBM acquires Turbonomic
IBM announced the acquisition of Turbonomic at the end of April for an undisclosed amount.
The Boston, MA-based company specializes in Application Resource Management (ARM) and Network Performance Management (NPM) software; it uses machine learning to spot application performance issues and optimize underlying resources, whether that involves containers, VMs, servers, storage, networks, and databases.
The acquisition is similar to the pick-up of Instana last year, as IBM looks to jump on the observability bandwagon. These acquisitions will all help IBM offer a greater range of AIOps and observability options for customers, particularly through its IBM Cloud Pak for Watson AIOps.
“IBM continues to reshape its future as a hybrid cloud and AI company,” Rob Thomas, senior vice president, IBM Cloud and Data Platform, said in a statement. “The Turbonomic acquisition is yet another example of our commitment to making the most impactful investments to advance this strategy and ensure customers find the most innovative ways to fuel their digital transformations.”
April 29: Microsoft acquires Kinvolk
Microsoft made a move to boost its capabilities in the Kubernetes space with the acquisition of German firm Kinvolk for an undisclosed amount.
Founded in 2015, Kinvolk has been building enterprise-grade tools to help developers adopt cloud-native technologies like containers and Kubernetes, including Flatcar Container Linux, as an alternative to CoreOS Container Linux, as well as the Lokomotive and Inspektor Gadget projects.
Microsoft expects to integrate the Kinvolk team and technology into the team responsible for its managed Azure Kubernetes Service (AKS), its hybrid solution Azure Arc, and to boost Microsoft’s upstream open-source contributions.
“We’re excited to bring the Kinvolk team and their technologies to Microsoft and look forward to the contributions they bring to Azure, our customers, and the open source community,” Brendan Burns, corporate vice president, Azure Compute wrote in a company post.
April 23: Panasonic acquires Blue Yonder for $7.1B
Panasonic acquired the remaining 80% of shares in Blue Yonder in April, spending $7.1 billion, including the repayment of debt.
Arizona-based Blue Yonder specializes in automated supply chain software that uses AI, IoT, and edge computing technology to track goods. Panasonic will look to add these capabilities to its Autonomous Supply Chain offering, which helps customers better track their supply chain and predict future demand for better efficiency.
“I’m extremely happy to welcome Blue Yonder and its associates to the Panasonic Group. Both companies have the same mission to support customers’ frontline operations and we have a high affinity in our corporate cultures. By merging the two companies, we would like to realize a world where waste is autonomously eliminated from all supply chain operations and the cycle of sustainable improvement continues,” Panasonic CEO Yuki Kusumi said in a statement.
April 15: IBM to acquire myInvenio
IBM acquired process automation specialist myInvenio for an undisclosed amount. The Italian firm specializes in process mining, a fairly nascent technology that allows enterprises to identify inefficient business processes and find opportunities for greater automation using data and software.
The acquisition marked the continuation of a bit of a trend, as fellow vendor SAP acquired process automation specialist Signavio earlier this year (see below). IBM will fold myInvenio into its existing Automation business unit.
“Digital transformation is accelerating across industries as companies face increasing challenges with managing critical IT systems and complex business applications that span the hybrid cloud landscape,” Dinesh Nirmal, general manager for IBM Automation, said in a statement. “With IBM’s planned acquisition of myInvenio, we are continuing to invest in building the industry’s most comprehensive suite of AI-powered automation capabilities for business automation so that our customers can help employees re-claim their time to focus on more strategic work.”
April 12: Microsoft to acquire Nuance for $19.7B
Microsoft unveiled the biggest acquisition of the year so far when it announced the purchase of Nuance for $19.7 billion in an all-cash deal.
Based in Burlington, MA., Nuance specializes in conversational artificial intelligence (AI) and speech recognition technology, primarily aimed at helping healthcare workers streamline the capture and interrogation of clinical information to free up their time. Microsoft will be eying its capabilities to complement its existing Microsoft Cloud for Healthcare product, one of a growing selection of industry-focused cloud suites.
“Nuance provides the AI layer at the healthcare point of delivery and is a pioneer in the real-world application of enterprise AI,” Microsoft CEO Satya Nadella said in a statement. “AI is technology’s most important priority, and healthcare is its most urgent application. Together, with our partner ecosystem, we will put advanced AI solutions into the hands of professionals everywhere to drive better decision-making and create more meaningful connections, as we accelerate growth of Microsoft Cloud in Healthcare and Nuance.”
March 31: Hitachi acquires GlobalLogic for $9.6B
Japanese conglomerate Hitachi announced it is acquiring tech services outsourcing company GlobalLogic in a $9.6 billion deal that includes repayment of debt at the end of March.
Based in Silicon Valley, GlobalLogic works with customers such as McDonald’s and Reuters to build digital services and products and has more than $1 billion in annual revenues. Hitachi will look to combine GlobalLink with its own technology units, specifically Lumada.
“The acquisition of GlobalLogic creates an exciting new opportunity for Hitachi to expand our offerings of Lumada solutions and services, provide value to customers in their digital transformation journey, and grow our Lumada business globally,” Hitachi CEO Toshiaki Higashihara said in a statement. “The synergy of GlobalLogic’s leading experience design and innovation with Hitachi’s expertise in IT, operational technology, and products, will help us realize our goal to be the leading digital transformation innovator in social infrastructure worldwide.”
March 23: UiPath acquires Cloud Elements
On the same day ServiceNow made a robotic process automation (RPA) acquisition, RPA vendor UiPath made an addition of its own, picking up the Denver, CO-based firm Cloud Elements for an undisclosed amount.
Cloud Elements specializes in API integration, similar to Mulesoft and Apigee, which are now part of Salesforce and Google, respectively. For UiPath, this capability could allow customers to better link processes that span various enterprise systems to build more effective automations.
“By making automation both easier and faster to deploy, the UiPath Platform has the capability of significantly improving some of the most costly and time-consuming activities of the modern enterprise. The acquisition of Cloud Elements is just one example of how we are building a flexible and scalable enterprise-ready platform that helps customers become fully automated enterprises,” UiPath CEO Daniel Dines said in a statement.
March 23: ServiceNow acquires Indian RPA company Intellibot
ServiceNow moved to add more robotic process automation (RPA) capability to its platform by picking up the Indian startup Intellibot for an undisclosed price. ServiceNow intends to build Intellibot’s capabilities into its Now Platform to allow customers to automate more business processes.
“ServiceNow is the platform of platforms for the workflow revolution, offering powerful end‑to‑end automation capabilities that allow customers to streamline business decisions and unlock new levels of productivity,” Josh Kahn, senior vice president of Creator Workflow Products at ServiceNow, said in a statement. “With Intellibot, we will extend ServiceNow’s ability to help customers connect systems so they can easily automate workflows and drive productivity.”
This acquisition continues a trend of IT companies offering RPA capabilities, either by building them, as Microsoft has, or buying them, as SAP did when it acquired Signavio in January (see below).
March 19: Aveva completes $5B OSIsoft deal
British industrial software specialist Aveva completed the $5 billion acquisition of its US rival OSIsoft in March. The deal was initially announced last summer and passed regulatory approval in March 2021.
Based in California, OSIsoft is part of SoftBank’s $100 billion Vision Fund portfolio and specializes in real-time industrial operational data, which should complement the Cambridge-based firm if smoothly integrated.
“Data has been enabling organizations to more effectively determine the cause of problems by allowing them to visualize what is happening in different locations, departments and systems. This agreement will enable our customers to improve business processes as well as eliminate inefficiencies,” AVEVA CEO Craig Hayman said in a statement last year when the deal was first announced.
March 18: VMware acquires Mesh7
VMware announced plans to acquire the security vendor Mesh7 for an undisclosed amount in March.
Based in Sunnyvale, CA, Mesh7 specializes in API security for distributed cloud environments. The Mesh7 team will join the Tanzu unit at VMware to work on service mesh security.
“Mesh7 technology will enable VMware to bring visibility, discovery, and better security to APIs,” Tom Gillis, senior vice president and general manager for networking and security at VMware, wrote in a blog post. “Security teams and operators need better visibility into application behavior and overall security posture, and the developer experience needs to lead to more secure operations.”
March 9: Dropbox acquires DocSend for $165M
In one of the more obviously complementary deals of the year so far, cloud file storage specialist Dropbox is acquiring DocSend, the secure document sharing company and fellow San Francisco native, for $165 million in cash.
DocSend had raised just $15 million in funding since being founded in 2013, marking an excellent exit for the company and its investors, which includes DCM Ventures and August Capital.
Its unique selling point is the ability to give those who share a documents full visibility into whether a doc is opened, by whom, and when. Dropbox also acquired the e-signature company HelloSign last year, and is looking to integrate all of those capabilities into a secure end-to-end document sharing experience for customers.