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Global M&A Insights: Technology deals dominate in 2021

With record-breaking deal volumes across the globe, we examine the drivers behind the boom in technology M&A, digital infrastructure deals, and software investments. We also look into the reasons behind record capital raising by technology companies, the considerations required for AI due diligence and talent retention in technology acquisitions, and the global trend for growing government intervention on sensitive transactions.

Report highlights

  • 2021 was a record year for M&A, with the global value of M&A transactions topping USD5 trillion for first time
  • M&A values in the technology sector exceeded USD1 trillion in 2021, the highest year on record, with a 64% increase vs 2020
  • Software deals accounted for almost half of all the technology sector’s deals by value, seeing an increase of 121% compared to 2020
  • Transactions focusing on key pieces of digital infrastructure, particularly telecom towers, data centres and fibre networks, continue to boom
  • Due diligence processes face novel risks as investors acquire Artificial Intelligence (AI) technologies
  • Fundraising by technology and life sciences companies dominated the capital markets
  • Tighter controls on foreign direct investment and national security screening may significantly impact technology transactions in 2022
  • “Acqui-hire” employment issues continue to feature high on due diligence agendas

Global M&A transactions top USD5 trillion for first time

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The value of global M&A transactions surged to a record high of over USD5.8 trillion in 2021, an increase of 64% on 2020, and 48% higher than 2018, the previous highest year on record.

A record year for technology M&A – what’s behind the boom?

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Technology M&A was the overriding driving force in a buoyant transaction market in 2021, accounting for some 20% of all deals by value and 22% by volume. We look at the issues that are behind the massive rise in technology transactions. Learn more about what is driving technology transactions.

What’s driving the surge in digital infrastructure deals?

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Transactions focusing on key pieces of digital infrastructure, particularly telecom towers, data centres and fibre networks, continue to surge ahead, leading some players to explore whether more active parts of their networks can also be hived off and sold. Find out about key trends in digital infrastructure deals.

Why software deals are proving irresistible to a diverse range of investors

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An increasingly diverse range of investors is focusing on software-related deals, including established technology businesses, companies across other sectors looking to speed their digital transformation, and PE funds, attracted by steady revenue streams and buy-and-build opportunities. Learn how and why software-related deals are proliferating.

New due diligence challenges facing investors in AI

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As developments in Artificial Intelligence accelerate, investors looking to acquire AI technologies or buy or collaborate with companies working in this industry are having to address many new and specific risks in their due diligence processes. Find out the key due diligence issues in AI transactions.

What is driving record levels of fundraising by technology companies?

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Fundraising by technology and life sciences companies not only dominated capital raising markets in 2021 but consistently grew throughout the year, beating all previous records for amounts raised. Learn why and how technology companies are raising capital at such pace.

How are government national security probes affecting technology transactions across the world?

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As governments across a growing number of jurisdictions increase their scrutiny of M&A deals on national security or national interest grounds, technology transactions are disproportionately in the frame for increased scrutiny, a trend that is only likely to grow. Learn more about the impact of FDI controls on technology deals. 

What are technology investors doing to retain and incentivise key personnel in their acquisitions?

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Hiring and retaining people who have niche expertise or skills that are in high demand is often an important factor in technology deals. Buyers are stepping up their efforts to incentivise and retain people they consider to be vital to the long-term success of the business. Find out how technology investors are looking to retain key personnel.