Biggest technology acquisitions of 2020

We round up the biggest technology industry mergers and acquisitions of the year so far

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Last year marked a slight decrease in global technology M&A activity from the blockbuster year that was 2018 – when SAP bought Qualtrics for $8 billion, IBM acquired Red Hat for a staggering $33 billion and Broadcom picked up CA Technologies for $18.9 billion in cash.

As of the end of Q3 2019, technology M&A deals worth $245 billion had been announced globally, marking a decrease of 25% year-on-year according to GlobalData.

Which mergers and acquisitions does 2020 have in store? If January alone is anything to go by, there will be no slowing of major deals across the industry, with security already proving to be a hot area.

Here are the biggest technology acqusitions of 2020 so far, in reverse chronological order:

12 October: Twilio to acquire Segment for $3.2B

Cloud communications specialist Twilio made a splashy acquisition in October, picking up customer data platform Segment for $3.2 billion in an all-stock deal.

Both San Francisco-based companies specialize in application programming interfaces (APIs) that  make collecting and consolidating customer data (Segment) and communicating via digital channels (Twilio) easier than building this functionality from scratch.

“Data silos destroy great customer experiences,” Jeff Lawson, co-founder and CEO of Twilio, said in a statement. “Segment lets developers and companies break down those silos and build a complete picture of their customer. Combined with Twilio's Customer Engagement Platform, we can create more personalized, timely and impactful engagement across customer service, marketing, analytics, product and sales.”

Twilio hopes that by bringing Segment's rich customer data together with its variety of engagement channels it can enable something close to personalized customer outreach at scale — the modern day holy grail for many marketeers.

13 September: Nvidia to acquire Arm for $40B

Chipmaker Nvidia confirmed the planned acquisition of UK-based chip designer Arm in September for $40 billion in a combined stock-and-cash deal. The purchase sees the Japanese telco Softbank part with an asset it only acquired in 2016.

“Simon Segars and his team at Arm have built an extraordinary company that is contributing to nearly every technology market in the world. Uniting NVIDIA’s AI computing capabilities with the vast ecosystem of Arm’s CPU, we can advance computing from the cloud, smartphones, PCs, self-driving cars and robotics, to edge IoT, and expand AI computing to every corner of the globe," Jensen Huang, founder and CEO of NVIDIA said in a statement.

Based in Cambridge, England, Arm designs chips for companies such as Nvidia and its rivals to manufacture. "As part of NVIDIA, Arm will continue to operate its open-licensing model while maintaining the global customer neutrality that has been foundational to its success, with 180 billion chips shipped to-date by its licensees," the company said.

In terms of Nvidia's commitment to the UK, it outlined in the announcement that “Arm will remain headquartered in Cambridge," and the company will continue to "attract researchers and scientists from the UK and around the world."

"I thought that Arm was the best tech company to come out of the UK in the last 50 years. I thought that its original sale to Softbank in 2016 for $32 billion was a mistake and should have been stopped by HMGovt at that time. I thought allowing Softbank to offload to Nvidia was an even bigger mistake on so many fronts," analyst Richard Holway at TechMarketView said.

8 September: Progress Software acquires Chef for $220M

In September, Progress Software announced it was acquiring the infrastructure-as-code pioneer Chef for $220 million in cash.

“This acquisition perfectly aligns with our growth strategy and meets the requirements that we’ve previously laid out: a strong recurring revenue model, technology that complements our business, a loyal customer base and the ability to leverage our operating model and infrastructure to run the business more efficiently,” CEO Yogesh Gupta said in a statement.

“Chef and Progress share a vision for the future of DevSecOps and Progress will provide the scale to further drive Chef’s platform forward and deliver additional value to our customers,” said Chef CEO Barry Crist.

The price tag shows that Chef has had a hard time maintaining its early momentum in the highly competitive open source DevOps tooling space. When it last raised funding in 2015 the company was valued at $360 million.

13 July: HPE picks up Silver Peak for $925 million

Hewlett Packard Enterprise made a big commitment to the SD-WAN (software-defined networking in a wide area network) market in July when it announced its intention to buy Silver Peak for $925 million.

Founded in 2004, Silver Peak specialises in WAN technology and will join HPE's networking brand Aruba.

"Our Unity EdgeConnect SD-WAN edge platform is highly complementary to HPE's industry-defining SD-Branch offerings and it will become the centerpiece of Aruba's WAN edge strategy," Silver Peak CEO David Hughes wrote in a blog post. "Upon closing the deal, we will become part of HPE's Aruba division, bringing together the industry's most comprehensive end-to-end secure networking portfolio from the data centre to the campus, to branch and remote worker locations."

8 July: SUSE acquires Rancher

SUSE, the enterprise Linux specialist, is doubling down on Kubernetes with the July acquisition of Rancher, for an undisclosed amount. The Cupertino-based company has built a popular open source Kubernetes container management platform, with customers like Sky, Sony Playstation and Deutsche Bahn.

“Rancher and SUSE will help organizations control their cloud native futures,” said Sheng Liang, Rancher CEO, as part of a statement. “Our leading Kubernetes platform with SUSE’s broad open source software solutions creates a powerful combination, enabling IT and operations leaders worldwide to best meet the needs of their customers wherever they are on their digital transformation journey from the data center to cloud to edge.”   

The deal is expected to close before the end of October 2020, subject to regulatory approval.

6 July: Uber to acquire rival Postmates for $2.65 billion

Ride hailing giant Uber agreed to acquire food delivery business Postmates in July, in a $2.65 billion all-stock takeover. The deal will bring together two of the biggest food delivery companies in the US and will bolster Uber's own Eats brand.

"We’re thrilled to welcome Postmates to the Uber family as we innovate together to deliver better experiences for consumers, delivery people, and merchants across the country,” said Uber CEO Dara Khosrowshahi in an announcement.

The deal is subject to regulatory approval and could yet face scrutiny over competition.

30 June: Google acquires glasses maker North

After its own failed effort at consumer smart glasses with Google Glass, the search giant announced the acquisition of North in June, for an undisclosed amount.

The Canadian company makes the stylish Focals smart glasses and will join the Google office in its native Kitchener-Waterloo.

"Google has always strived to be helpful to people in their daily lives. We’re building towards a future where helpfulness is all around you, where all your devices just work together and technology fades into the background. We call this ambient computing," Rick Osterloh, Senior Vice President for devices and services at Google wrote in a blog post.

26 June: Amazon to acquire autonomous driving startup Zoox for £1.2 billion

Amazon announced that it is acquiring the self-driving vehicle company Zoox for a reported $1.2 billion in June.

Amazon has shown a keen interest in the self-driving car space for some time now, taking stakes in the electric truckmaker Rivian and self-driving start-up Aurora.

Founded in California 2014, Zoox was planning on launching a pilot programme for its ride-sharing service this year, but has had to put those plans on ice due to the coronavirus pandemic. It had raised nearly $1 billion in funding to date, making it one of very few autonomous driving ‘unicorns’.

Zoox CEO, Aicha Evans and his cofounder Jesse Levinson will continue to lead Zoox as “a standalone business” within Amazon.

"Zoox is working to imagine, invent, and design a world-class autonomous ride-hailing experience," said Jeff Wilke, Amazon’s CEO for worldwide consumer, in a blog post. "Like Amazon, Zoox is passionate about innovation and about its customers, and we're excited to help the talented Zoox team to bring their vision to reality in the years ahead."

23 June: Mastercard to acquire open banking firm Fincity

Mastercard announced in June that it is acquiring Finicity for $825 million. 

The Utah-based fintech specialises in open banking – a new regulation-driven mode of banking which is further ahead in Europe than the US – where consumers are given greater control of their finances by leveraging secure APIs to connect their bank account to other fintech services and make quick payments, without using traditional middle men, like Mastercard.

What Finicity provides is a platform which enables financial institutions to connect up these new data streams to a wide range of financial institutions and credit decisioning bodies, without having to do the 'plumbing' themselves. Notable clients include FICO and Experian.

Analysts have noted a similarity in the deal to Visa's recent purchase of Plaid for $5.3 billion (see below).

"Mastercard invested early in open banking and launched a set of solutions in Europe last year. Today, these leading services are live in a dozen countries. With the addition of Finicity, Mastercard expects to not only advance its open banking strategy but enhance how it supports today’s digital economy. This strategic approach demonstrates how Mastercard is an excellent fit," wrote Finicity cofounders Steve Smith and Nick Thomas in a blog post.

22 June: Microsoft acquires CyberX

Microsoft announced the acquisition of Israeli IoT security specialists CyberX in June for an undisclosed amount. Microsoft will incorporate CyberX technology and talent into its cloud Azure unit, where it already offers the Azure IoT stack, Azure Security Center for IoT and Azure Sentinel. The CyberX team will now report in to fellow Israeli Yuval Eldar, Microsoft GM of IoT Security.

Founded in 2013, CyberX allows customers to manage and improve the security of their IoT assets, be that a set of autonomous robots on a factory floor, to a fleet of consumer-facing smart doorbells. Existing clients include major oil and has utilities and US government agencies, including the US Department of Energy.

28 May: Cisco acquires ThousandEyes

Cisco announced its intention to acquire network intelligence specialist ThousandEyes in May for an undisclosed amount.

San Francisco-based ThousandEyes sells cloud-based analytics tools for the internet, local and wide-area networks. The company also tracks ISP, cloud and collaboration application performance, data which we use to track global internet outages over at Network World.

“ThousandEyes’ technology warns us when a user’s experience is less than ideal and can pinpoint where those failures were caused. With thousands of agents deployed throughout the Internet, ThousandEyes’ platform has an unprecedented understanding of the Internet and grows more intelligent with every deployment,” Todd Nightingale, senior vice president and general manager at Cisco wrote in a blog post.

Cisco plans to embed ThousandEyes technology into its existing products, with AppDynamics application performance, SD-WAN, WebEx and Meraki standout candidates for a boost. The team will join a newly formed Networking Services unit at Cisco, reporting to Nightingale. ThousandEyes CEO Mohit Lad will become the GM of ThousandEyes.

19 May: Microsoft acquires UK-based Softomotive

Microsoft announced the acquisition of UK-based provider of robotic process automation software Softomotive in May for an undisclosed amount. Softomotive talent and technology – specifically its desktop automation tool WinAutomation – will be folded into Microsoft's Power Automate platform.

Founded in 2005 by Greek entrepreneurs Argyris Kaninis and Marios Stavropoulos, Softomotive has thousands of customers across the healthcare, banking, insurance, and telecom industries.

"Together with Power Automate, WinAutomation will provide customers additional options for RPA desktop authoring so anyone can build a bot and automate Windows-based tasks. The combined offering will also enable RPA connectivity to many new apps and services including SAP and traditional green-screen terminal applications," Charles Lamanna, CVP for the Citizen Application Platform stated in a blog post.

15 May: Facebook buys Giphy for $400 million

Facebook announced on 15 May that it was to buy Giphy, the popular searchable library for movable images, or gifs. The product and team will be rolled into the Instagram division of the social media giant. The price for the acquisition was pegged at $400 million by Axios, which broke the story.

"Giphy makes everyday conversations more entertaining, and so we plan to further integrate their GIF library into Instagram and our other apps so that people can find just the right way to express themselves," Vishal Shah, VP of product wrote in a blog post, in which he also referred to Giphy as a "leader in visual expression and creation".

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