M&A in technology space up 22% to $56.4 bn in July-Sep

Merger and acquisition (M&A) deals in the global technology sector amounted to $56.4 billion in the July-September quarter of 2011, an increase of 22% vis-a-vis the year-ago period, according to a report by Ernst & Young.

"In the face of market volatility and macroeconomic uncertainties that are dampening other industries, the mega trends driving global technology M&A so far have continued to push deal values higher," said Joe Steger, Global Technology Transaction Advisory Services Leader at Ernst & Young.

"The increase in values is primarily due to the period of hyper-innovation that technology companies are experiencing," he said.

He further said that technology companies have been delivering rapid waves of innovation around smart mobility, cloud computing, business intelligence/analytics, social networking, information security and other new technologies.

"The aggregate value of global technology M&A increased 8% sequentially and 22% year-on-year to $56.4 billion in the third quarter of 2011," the report stated.

It noted that big-ticket deals dominated in the quarter under review, with the top 11 deals worth a cumulative $40.1 billion, or 71% of the total value.

The average value per deal also climbed 14% vis-a-vis the preceding quarter and 26% year-on-year to $221 million.

Deals involving smart mobility and business analytics were the highlights of the third quarter of the 2011 calender year, with two deals valued over $10 billion each.

Looking ahead, the report said, "... The multiple disruptive technology mega-trends occurring now and driven by smart mobility, cloud computing and social networking make long-term M&A growth a relatively safe bet."