TMT M&A deals accelerated in second half of 2020 to reach nearly $1 trillion in value, says GlobalData

Merger and acquisition (M&A) activity in the tech, media, and telecom (TMT) market bounced back from the impact of COVID-19 in 2020 to achieve nearly $1 trillion in transaction value. Q2 2020 saw just 103 M&A deals in the sector – the lowest quarterly deal count in the last five years – but volume rebounded to 230 in Q3 and 222 in Q4, making the second half of the year the highest in terms of both deal count and deal value in the last five years.

Leading data and analytics company GlobalData expects M&A activity to continue at such a high level throughout 2021 as companies focus on their key technologies and adjust to the realities of the COVID-19 pandemic.

The company’s latest report, ‘M&A in TMT – 2020 Themes’, notes that there were a a total 702 M&A deals announced with a transaction value greater than or equal to $50m in the global TMT sector in 2020. The combined transaction value of $903bn was a 25% increase on 2019, when there was $723bn worth of deals.

Snigdha Parida, analyst for Thematic Research at GlobalData, commented: “The most lucrative themes driving M&As in 2020 were connectivity, big data, cloud, fintech, digital media, gaming, the internet of things (IoT), healthtech, the future of work and ecommerce. The report identifies the overall themes that drove M&A in TMT. It also categorizes all major deals announced between 2016 and 2020 into their respective sectors, with details of the themes driving each deal.

By studying the themes that are currently driving the M&A market, the report also identifies potential future acquisition targets along with their thematic rationale.

Parida, continued: “Last year was a landmark year for M&A activity in the TMT sector. The global outbreak of COVID-19 saw both businesses and individuals accelerate their adoption of technology solutions to suit new patterns of work and everyday life.”

“Although M&A activity fell to its lowest level over the last three years in the first half of 2020 due to the immediate impact of the virus, it recovered in the second half of 2020, with record-breaking growth. For consumers, the technology sector has played a critical role in meeting their daily needs, enabling many to work from home. The pandemic has resulted in an increased rate of technology adoption across all sectors globally and highlighted the key role it will play in the future.”

Information based on GlobalData’s report: ‘M&A in TMT – 2020 Themes’

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