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Introduction to TMT M&A Trends

  • United Kingdom
  • Corporate
  • Mergers and acquisitions
  • Technology, Media and Telecoms

12-10-2021

While all sectors of the M&A market are experiencing significant amounts of activity, the TMT sector, and in particular the technology sector, continues to lead the charge, with deal volumes at record levels. By some estimates, the TMT sector now accounts for almost 25% of all global M&A activity; and looking at the penetration of technology across all sectors, the apocryphal “all deals are now tech deals” certainly has an increasing ring of truth.

Much of this activity is driven by the fundamentals which have sustained M&A across all sectors for some time - low interest rates, cash rich balance sheets, the boundless appetite of private equity and the ever-tightening squeeze on organic growth - but the TMT sector is distinctive in the number of additional deal drivers which power the sector and particular areas of sub-sector activity. Whether that's the need for traditional businesses to pursue digital strategies, the rapid pace of technology innovation in areas such as AI, biometrics and robotics, the increasing awareness of the importance of harnessing technology to meet ESG challenges, the need to strengthen cyber security defences, increasing consumer acceptance of novel applications into daily life, the boost to the gaming sub-sector from increased leisure time, or the huge additional capacity demands necessitating more data centres and other infrastructure, at every turn the forces of business and societal change are pushing towards more TMT M&A.

And the other unique aspect of M&A in the TMT sector is that to a large extent all of these factors apply in a remarkably similar way across all of the world’s developed economies. Taken together with the ease with which new technologies can be adopted and applied across national boundaries, this means that TMT M&A deals, and the trends which are influencing and shaping TMT sector M&A, are more international in nature than any other sector .

Within Eversheds Sutherland’s TMT M&A Group, our teams in the US, Europe, Middle East and Asia work seamlessly together on advising TMT clients on all aspects of their M&A strategies. Each year, our M&A lawyers advise on over 400 deals. This gives us a global perspective on the issues impacting TMT sector M&A and the trends which shape the deals being done, as well as the way in which those deals are executed. It also gives us some clear insights and pointers as to what's likely to be coming next in all of the regions where we operate.

Over the coming months, lawyers from across our network involved in TMT M&A will be distilling that experience into a series of articles which will provide insight and analysis on those trends. For those of you with an interest in TMT M&A, we hope that you will find the articles useful and stimulating, and that you will join in the discussion with your own thoughts.

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