The combined Technology, Media and Telecom (TMT) sector has continued to evolve throughout this year, as ongoing consolidation results in some huge deals. Furthermore, in the near future, we could see more private equity transactions.
"Entire private equity funds have formed in recent years around a tech acquisition strategy," according to Mergermarket intelligence, highlighted by a 21.2 percent increase in the value of American technology buyouts ($32.8 billion) compared to the whole of 2014.
TMT market activity during the first quarter through the third quarter of 2015 has reached the second highest annual value on Mergermarket record (since 2001) with transactions valued at $534.2 billion, only beaten by 2006’s full-year total at $600.9 billion.
Compared to the whole of 2014, Q1-Q3 2015 accounts for 804 fewer deals (2,168 vs. 2,972), but has already seen a $10.8 billion higher deal value (vs. $523.5 billion), according to their latest worldwide market study.
The overall global mergers and acquisitions (M&A) environment reached a Q1-Q3 record value in 2015 at $2.87 trillion -- that's up by an encouraging 24 percent, compared to Q1-Q3 2014.
That being said, the collective market share of global Technology, Media and Telecommunications sectors increased by 2 percent and now stands at a respectable 18.4 percent.
TMT Key Growth Drivers During 2015
Areas within the industry are still growing such as cross-overs between the sub-sectors and the targeting of new technologies from other industries, along with an increase in cross-border acquisitions, soaring 30 percent from $196 billion in Q1-Q3 2014 to $255.2 billion Q1-Q3 2015.
According the Mergermarket assessment, total M&A targeting U.S. firms has already topped every other annual total on record with $1.42 trillion-worth of announcements, and still with three months to go before the close of 2015.
TMT activity was a driving force behind the record, contributing 22 percent towards the country's total activity. The United States was the most targeted country, representing 58.5 percent of the TMT global market share so far this year.
Four out of five TMT top deals have U.S. targets, with the highest valued seeing Time Warner Cable being acquired by Charter Communications for $77.8 billion.
Mergermarket says the U.S. market domestic deal making ($205.9 billion) was also the main driver behind global domestic activity reaching its highest level since 2006 with $279.3 billion-worth of deals.
Technology deal making has been fueled with cross-sector negotiations where tech firms can solve problems in a range of industries -- including the industrial and healthcare sectors.
As a result, it has not only remained the most targeted sector from last year, but it has also reached the highest annual total on Mergermarket record with 1,609 deals valued at $272.7 billion.