Technology Sector Looks Ready to Deal in ’15

Despite ending the year on a weaker note, deal value in the global technology sector is expected to pick up the pace in 2015, according to a new report by accounting and consulting giant Ernst & Young.

Deal value in the technology sector during the fourth quarter was down about 39% from the third quarter, to $44.9 billion, according to E&Y, with transactions involving advertising/ marketing and the so-called Internet of Things leading the charge. For the full year, deal value totaled $237.6 billion, according to E&Y — the highest figure since 2000.

Deal volume at 959 transactions was highest since the dot-com bubble of 2000, according to Ernst & Young. For the full year, 3,512 deals were reported, topping the 3,345 deals in 2007 and making it the highest since 2000.

Private-equity players and non-technology buyers increased their aggregate value in the period, accounting for 48% of total quarterly value, up from 22% in the third quarter. Private-equity buyers seemed to target companies “struggling with mobile-social-cloud transitions,” E&Y added.

Buyers also seemed to concentrate on smaller deals. E&Y said there was a 3% increase in midsized deals (from $100 million to $1 billion in value), to $21.4 billion, compared to a 19% decline in larger deals (above $1 billion) to $19.4 billion in the period. For the full year, midsized deals grew 36% to $75 billion, while big-ticket transactions increased 21% to $148.8 billion.