M&A Soundcheck—Buyers Feasting on Technology Hardware Distributors and Integrators; Other Sectors Remain Active

As 2018 comes to a close, we wanted to share the latest on deal making activity in the sectors covered by the Commercial & Consumer Technology (CCT) team.

Newletter CommercialConsumerTech MAReport Q318

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Continuing a trend that we’ve seen for some time, the technology distribution and integration worlds continue to consolidate, with several notable deals among venerable distribution companies selling consumer electronics, musical products or servicing pro-A/V and high end residential technology integrators. Ireland-based DCC has single handedly acquired three premier distribution companies this year, starting with Stampede (pro-A/V) and Kondor (mobile accessories) in July and continuing with the purchase of JAM Industries (MI) in October. PE also continues to invest in the sector with PE-backed companies such as AVAD and Snap A/V making acquisitions and most recently, Canada-based Microcel completing a private equity recapitalization. The growing commitment of PE dollars into the sector bodes well for future acquisition activity.

Also notable is that Zagg has stepped up its pace of acquisitions after having successfully consolidated Mophie which it acquired in 2016. Zagg completed two acquisitions in the second half of 2018, including the purchase of mobile audio company Braven from Incipio in what appeared to be a fire sale, and buying Gear4, one of the leading European smartphone case brands, in a divestiture from STRAX.

On a more personal note, it’s been an exciting year for Intrepid, as we announced in October that our firm is being acquired by MUFG Union Bank N.A.. The transaction is scheduled to close early in 2019 and we look forward to bringing our M&A and capital markets capabilities to MUFG Union Bank’s large base of commercial lending clients and benefitting from the global resources of one of the largest and most respected banking institutions in the world.