Mergers and acquisitions trends: Tech and media sector ready to power bounce-back in 2021

The media and marketing sector will fuel merger and acquisition growth over the next year, and “future proofing” will drive the post-2020 business agenda, according to new global research.

The international M&A advisory firm Ciesco analyzed 1,091 M&A transactions in 2020 and has published the only report of its kind that predicts the movements to be expected this year in the areas of mergers and acquisitions, private equity and technology sectors. The report also analyzes the seismic shifts in the buyer landscape caused by the Covid crisis last year.

MarTech remained one of the most active sectors. CRM is the only sector that has seen 30% annual growth since 2019. The world’s largest software market, expected to generate sales of $ 80 billion by 2025, will be accessible from any device, including cell phones, by 2020. “Remote Working” also required flexible mobile and cloud solutions more than ever to to offer their customers personalized experiences.

• Digital media, traditional media and MarTech remained the most popular sectors with 234, 180 and 143 deals respectively. This corresponds to 51% of the business activity in 2020.
• CRM was the only sector that saw a year-over-year increase – a 30% increase over 2019.
• Only 1,091 M&A transactions were recorded in 2020, a 19 percent decrease from 2019
• The total value of transactions excluding transactions over $ 10 billion was $ 55.9 billion, down 50 percent from 2019
• Digital media, traditional media, showed resilience, and customer relationship management (CRM) companies saw M&A activity increase 30 percent year over year.
• Private equity deals were down 29 percent in 2020, while technology, digital, media and marketing PE deals represented 37 percent of all buyers in 2020.
• E-commerce is expected to boost retail sales and Special Acquisition Companies are expected to raise funds in 2021.
• Business transformation and future security will set the agenda for companies after the challenges of 2020.

• Digital media, traditional media and MarTech remained the most popular sectors with 234, 180 and 143 deals respectively. This corresponds to 51% of the business activity in 2020.
• CRM was the only sector that saw a year-over-year increase – a 30% increase over 2019.

• Ciesco presents M&A analysis of the technology, digital, media and marketing sectors
• The volume of M&A deals in 2020 in the US and UK remained robust and grew in China
• Purchase dominated by private equity firms
• Tech-Driven Business Transformation to Drive Recovery

The industry-specialized M&A consultancy Ciesco reports on the global resilience in the areas of technology, digital, media and marketing in the face of the Covid crisis.

Ciesco tracked global M&A activity in these sectors and reported 1,091 M&A transactions in 2020 with announced deal values ​​of USD 55.9 billion. That figure ruled out the one mega-deal of the year (defined as a $ 10 billion deal): Salesforce’s acquisition of the Slack communications platform for $ 27.7 billion. This happened despite a predominantly pandemic-related decline in M&A activity of 19 percent last year.

Digital media, traditional media and MarTech were the most popular sectors for doing business, together accounting for more than half of total business volume in 2020. In the Customer Relationship Management (CRM) business units, M&A activity increased by 30 percent compared to the previous year.

The private equity market showed the greatest boost. PE deals in the fields of technology, digital, media and marketing made up 37 percent of all M&A activity in 2020. That was a decrease of 42 percent in 2019, but well more than 13 percent in 2017. Consulting firms, technology firms, and holding companies contributed to a diverse buyer at Universum, private equity among the top 10 acquirers.

Chris Sahota, CEO of Ciesco, commented on the report as follows: “Our report shows the attractiveness of data and technology-driven business models for financial investors. Due to the turbulence of the past year, companies are learning to adapt their business activities and make them future-proof.

“2021 will be a time of reinvention for many companies. Technology and data will be at the forefront of this evolution, with the intelligent use of data influencing decisions in every part of an organization.

“Global holding networks have spent much of 2020 restructuring their operations in the face of declining revenues, and taking the opportunity to dispose of below-average legacy assets. We see a strong appetite for mergers and acquisitions to empower technology services, disciplines and regions. ”

The report assumes that the outlook for 2021 will provide opportunities for investors looking to support companies with dynamic business models. E-commerce is expected to boost retail sales this year, and Special Purpose Acquisition Companies, which raised $ 80 billion in donations over the past year, are expected to boost fundraising in 2021.

The Ciesco report shows that business was done in 84 countries over the past year, driven primarily by technology, media and marketing. The US and UK remained the most active M&A markets, followed by France, Germany, Canada and the Netherlands. Together they accounted for 76 percent of global M&A deal flow.
Business increased in China, where after a year of relative inactivity, 18 deals were announced in 2020. Notable deals included Tencent Holdings’ acquisition of digital marketing agency Bitauto for $ 11 billion and Baidu’s acquisition of live streaming platform JOYY for $ 3.6 billion.

Reinvention, flexibility and future security will be high on the agenda for companies after the challenges of 2020. Ciesco’s Global Review 2020 and 2021 Outlook Report are the most comprehensive reports of its kind. It is available now and can be downloaded here

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