The technology sector continued to lead the global M&A markets in 2016, with 1,613 reported acquisitions (according to Thomson Reuters) that had an estimated deal value of $323.5 billion. The fourth quarter alone contributed 472 deals for an aggregate $96 billion. Digging in further shows that Software and IT Services were among the most active sectors within Technology in 2016, representing 659 and 512 deals, respectively.
Well-capitalized institutional sponsors (private/growth equity, venture capital, family offices) continue to compete head-to-head with strategic acquirers in deploying large amounts of dry powder at aggressive valuations. We believe this record sellers’ market for Software & Services will hold strong through 2017.