A study released by Berkery Noyes examines the acquisition and merger tendencies of the online and mobile industry. Beyond a continuing increase in activity for the industry on the whole, both Google and Microsoft have been especially active in the first half of 2011.
The Continuing Rise of Mobile and Online
Berkery Noyes, which has claimed the title of "leading independent investment bank specializing in the information content and technology industries," examined the merger and acquisition trends for the first half of 2011. This data was compared to six-month data from 2009 and 2010.
The big takeaway is that mobile and online technology mergers and acquisitions are continuing to become bigger and more frequent. The total number of transactions increase from 643 in the second half of 2010 to 788 transactions in the first half of 2011, a 23 percent increase. Even more impressive is the total value of transactions, which increased from $28.46 billion (U.S.) to $43.31 billion (U.S.) in the same time period, representing a 52 percent increase.
While numerous sectors of online and mobile technology are seeing improved activity, the single sector with the largest growth was communications, which saw a 44 percent increase in the first half of 2011. Median value multiples for all sectors, when examining transactions where those value multiples were disclosed, also saw a major increase. The EBITDA multiple rose to 15.3 while the revenue multiple rose to 2.1. These figures are both "30-month highs," according to the Berkery Noyes report.
A full version of the Berkery Noyes report is available online.
Google and Microsoft's 2011 Acquisitions
Google and Microsoft both got a special place in the report: Google is the single most active company in mergers and acquisitions for this field, while Microsoft had the single biggest transaction for the first half of 2011.
Google earned that "most active" title by acquiring 11 companies. This brings the total number of online and mobile companies acquired over the last two-and-a-half years to 39. The acquired companies in 2011 were SageTV, AdMeld Inc., PostRank Inc., Sparkbuy Inc., TalkBin, PushLife Inc., BeatThatQuote.com Ltd., Next New Networks, Inc., FFlick, SayNow, and eBook Technologies Inc.
Meanwhile, Microsoft's $9.08 billion acquisition of Skype from Silver Lake Partners represents the single largest transaction. This one acquisition represented more than 20 percent of all acquisition spend for the industry in the first half of 2011.