Tech gobbles tech with relentless shots of M&A.

pacman_M&A.JPG

InvenSense, Inc. (unfamiliar name?) has just been swallowed up by US$11 billion capitalised TDK (household name) for ~US$1.3 billion.

The target, which represents more than 10% of TDK's market value, makes sensors and enabling software that TDK will use to pivot into revenues from mobile, wearables, smart home, smart cities, automotive and the IoT (internet of things). 

Separately, US$92 billion capitalised Salesforce.com (which acquired AtticLabs in January) has just agreed to buy (sum undisclosed) an e-commerce software start-up called CloudCraze. The target has a solution that was independently developed on its customer relationship platform (and partially funded by Salesforce's investment arm, Salesforce Ventures). 

As Atlassian's co-founder, Mike Cannon-Brookes said today, "Technology is the single greatest competitive advantage in business today. It's eating every industry in the world."

I would add that this includes the tech industry itself, and is why M&A is becoming a critical growth strategy for all companies, including big and small tech.

If disruptive tech falls behind and becomes the disrupted, they are history - so a smart alternative is to look at start-ups and bleeding edge players as the outsourced R&D division, and once ripe, gobble!

Mike


We are a leading strategic corporate advisory firm that independently delivers tailored corporate finance and control change solutions to clients looking to transform their businesses, in and out of Australia.

You can subscribe to our newsletter here.