The biggest enterprise technology M&A deals of 2020

It’s been such a noisy year that many enterprise technology acquisitions have passed almost unnoticed. Salesforce.com’s $27.7 billion offer for Slack , though, serves as a reminder how active the merger market has been.

The enterprise software and services landscape has continued evolving, even as the pandemic has rumbled on, with startups in new product categories disrupting established vendors, and well-known names combining to stay on top of the market. Cloud services in particular is a market that has been changing rapidly of late, both in terms of the software that runs in the cloud and the hardware that powers it.

For CIOs, mergers and acquisitions (M&As) in the tech space can be disruptive to strategic rollouts, spell a need to pivot to a new solution, mean the potential sunsetting of essential technology, provide new opportunities to leverage newly synergized systems, and be a bellwether of further upcoming shifts in the technology landscape. Keeping on top of activity in this area can help your company make the most of emerging opportunities and steer clear of issues that often arise when vendors combine.

Here CIO.com rounds up of some of the most significant M&As of 2020 that could impact IT.

Salesforce.com to buy Slack for $27.7 billion

Integration with enterprise chat tool Slack is increasingly seen as a key feature for SaaS apps in conferencing, ticketing, calendaring, or project management. Now Salesforce.com has taken that integration one step further, agreeing to pay $27.7 billion to buy Slack so that it can make it the new interface for its Customer 360 platform. Salesforce’s support will open the door of more enterprises for Slack and give it the resources it needs to go head-to-head with Microsoft’s Teams product. Salesforce, though, will likely need to add a few more components to its platform if it’s to be seen as a full-featured alternative to Microsoft 365 or Google Workspace.

AMD to pay $35 billion for FPGA play Xilinx

With the rise in machine-learning, AMD has seen increased demand for GPUs, a market in which Nvidia, not Intel, is its biggest rival. Some ML workloads, though, run more efficiently or economically on field-programmable gate arrays (FPGAs), chips that are general-purpose when they leave the factory, but optimized for a specific task once programmed. Intel made its FPGA play in 2015, paying $16.7 billion for Altera. AMD’s October offer to buy Altera’s main competitor, Xilinx, for $35 billion in stock cleared its first antitrust hurdle in January, potentially opening up new markets for it in machine learning and inference. 

Information Builders to be Tibco Software’s biggest buy yet

Tibco Software has closed its acquisition of Information Builders, which it will roll into its range of data integration products. Information Builders makes data and analytics software. Tibco says the deal, reported to be worth almost $1 billion, is its largest acquisition ever.

Twilio buys customer data platform Segment for $3.2 billion

Twilio has already worked its way into many enterprises with its range of APIs for voice, text, chat, video and email communication with customers. With its November acquisition of customer data platform Segment for $3.2 billion in stock it aims to extend that reach, controlling not just how customers receive specific messages but also why.

Ericsson pays $1 billion for enterprise 5G vendor Cradlepoint

It’s always been possible for enterprises with large campuses or industrial sites to build out private cellular networks, but the arrival of 5G mobile technology makes it both easier and more interesting. Telecommunications equipment vendor Ericsson primarily sells to telcos, but CIOs should expect a call too, as in November it closed its $1 billion acquisition of Cradlepoint, an Idaho company that sells wireless edge systems to enterprises.

SAP shows it’s still in customer experience game with Emarsys buy

SAP’s acquisition of Austrian omnichannel customer engagement platform vendor Emarsys shows that it’s still very much interested in customer experience. Previously, the company had been sending mixed signals about its commitment to the category, announcing plans in July that it would sell off a stake in Qualtrics, the survey company it paid $8 billion for in 2018. SAP isn’t saying how much it paid for Emarsys, but some reports put the price at around $500 million. Emarsys had previously raised around $55 million in venture funding.

Sinch buys SAP Digital Interconnect

Here’s another acquisition involving SAP — and for once it’s not SAP doing the buying. Sinch is a Swedish provider of cloud-based outbound calling and messaging services for customer engagement. SAP Digital Interconnect (SDI) offers something similar, but with APIs that hook deep into SAP’s ERP and CRM platforms. In November Sinch closed a €225 million ($250 million) acquisition of SDI to expand its engineering team and gain exposure to the enterprise market.

GTT Communications sells infrastructure division to I-Squared Capital

After GTT Communications acquired Interoute, Hibernia and KPN International, it found itself with some excess capacity, including a fiber network spanning 103,000 kilometers and 400 points of presence, three transatlantic cables and 14 data centers. Investment firm I-Squared Capital has snapped those up for $2.15 billion, leaving GTT to focus on cloud networking and what it calls a “capex-light” business model.

Apptio buys SaasLicense

Apptio, a company that helps CIOs figure out how much they’re spending on IT, has bought SaasLicense, a tool to help businesses optimize their spending on software as a service. Apptio won’t say how much it spent.

Progress Software takes charge of Chef Software

App dev platform vendor Progress closed a $220 million deal in mid-October to buy devops/devsecops specialist Chef Software, the company behind Chef Enterprise Automation Stack, Infra, InSpec and other tools to speed software development.

Veeam buys Kubernetes backup specialist Kasten

Veeam has added Kubernetes backup to its range of cloud data management services. In October it paid $150 million for Kasten, whose K10 platform allows enterprises to back up and restore Kubernetes applications wherever they are running.

KKR sells Epicor Software to CD&R for $4.7 billion

KKR, the investment firm that acquired Epicor Software for a rumored $3.3 billion in 2016, has flipped it to another investment firm for $4.7 billion, after a year searching for a buyer. Epicor, a cloud ERP vendor targeting industry verticals in manufacturing, services and distribution, is the first big move into tech for Clayton, Dubilier & Rice. CD&R says it wants to expand Epicor’s product portfolio and grow the firm through further acquisitions. (Under KKR’s ownership it bought docSTAR, MechanicNet and 1 EDI Source.) KKR hasn’t abandoned software altogether: It still owns BMC Software, acquired in a 2018 deal said to be worth $8.5 billion.

SugarCRM buys Node

Sales staff increasingly expect their CRM tools to tell them which of their customers to contact next and why, rather than helping them remember what they bought last time or the name of their dog. That’s prompted SugarCRM to snap up Node, a Silicon Valley startup that offers a range of AI-based predictive analytics tools for automating sales and marketing functions. It’s SugarCRM’s fourth acquisition in two years: The others were Collabspot (email integration), Salesfusion (marketing automation) and Corvana (sales analytics).

Analog Devices to buy Maxim Integrated Products for $21 billion

Analog Devices wants to combine its experience in high-frequency radio semiconductors with the strengths of Maxim Integrated Products in making components for data centers. These markets are colliding as computing associated with the internet of things moves to the edge of 5G network infrastructure. Although the two chipmakers announced in mid-July that they plan to merge, the $21 billion deal won’t close until the middle of 2021.

NetApp buys Spot to optimize costs

NetApp, big in hybrid cloud infrastructure, has mopped up Spot, a much smaller business specializing in cloud cost optimization. The deal, rumored to be worth $450 million, closed mid-July. Spot — now Spot by NetApp — offers compute and storage cost optimization tools that the company says can help spendthrift enterprises save up to 90% on cloud costs.

Databricks acquires dashboarding tool Redash

Databricks has enhanced its data analytics platform with the acquisition of Redash, the company behind an open source dashboarding tool for data scientists. Databricks has some solid technical chops: It was founded by creators of the big data analytics engine Apache Spark and of Delta Lake, an open source storage layer for data lakes, and offers enterprise services built on top of them. While Databricks’ data analytics platform can already be connected to Redash, the acquisition will allow Databricks to more fully integrate the two.

BMC Software buys Compuware

For all the talk of disruptive technologies, mainframes remain at the heart of many businesses today, and it is this fact — and the enterprise’s need for modernization — that fueled the merger of two specialists in software modernization. The combination of BMC’s Automated Mainframe Intelligence (AMI) and Compuware’s product range, which closed on June 1, will help enterprises manage mainframes as part of their DevOps strategies. Compuware last changed hands for around $2.4 billion in 2014 in a buyout by private equity firm Thoma Bravo, which took the company private and split it into two entities, Compuware’s mainframe software business and Dynatrace, which was spun out to focus on software management. BMC isn’t saying how much it paid for Compuware this time around.

Cincinnati Bell sells to Macquarie Infrastructure

Early next year, enterprises in Cincinnati, Ohio, and Hawaii will find their local telco is under new ownership. In December 2019, it seemed a done deal that Brookfield Infrastructure Partners would acquire Cincinnati Bell for $2.6 billion. In early March 2020, though, Cincinnati received a higher offer from Macquarie Infrastructure and, after a short bidding war, broke off the engagement to strike a deal with Macquarie worth $2.9 billion, which shareholders finally accepted in May. Customers counting on Cincinnati’s ambitious fiber upgrade and 5G rollout plans may have dodged a bullet: Brookfield, the rejected suitor, focuses on generating stable cash flows from minimum maintenance capital expenditures.

Palo Alto Networks secures connection with CloudGenix

April saw the acquisition by Palo Alto Networks of software-defined-WAN specialist CloudGenix for $420 million, allowing the cybersecurity firm to add SD-WAN functions to its Prisma Access secure edge platform.

Microsoft affirms interest in 5G networks

Affirmed Networks makes software for building virtualized, cloud-based telecommunications networks, and counts some of the world’s biggest telcos among its customers. Now it’s part of Microsoft, which sees in the acquisition a way to expand its relationships with mobile network operators and play a role in the deployment of 5G services.

Quantum buys WD’s object storage unit ActiveScale

Quantum, a data storage vendor, has bitten off a chunk of Western Digital, the hard disk giant that bought flash storage vendor SanDisk back in 2015. When WD decided it could do without ActiveScale, a business unit that makes object storage systems, Quantum saw an opportunity to beef up its high-speed unstructured data storage capabilities.

Equinix buys Packet Host

Data center owner Equinix has added a new string to its bow with the March acquisition of Packet Host, a specialist in bare metal automation for a reported $330 million. Equinix says the deal will help its customers deploy multicloud infrastructure without the overhead associated with virtualization or multitenancy.

Clarivate Analytics buys Decision Resources

Data vendor Clarivate closed its $950 million purchase of Decision Resources in March 2020. Clarivate gathers information about trademarks, patents, scientific research and industrial standards, selling the databases to enterprises under a variety of brands. CIOs that want to hang on to valuable domain names might already know Clarivate’s MarkMonitor brand. With the acquisition of Decision Resources, Clarivate now has a greater range of data about the medical and health care industries at its disposal.

Salesforce buys Vlocity for $1.3 billion

Vlocity is one of Salesforce’s biggest cheerleaders: It builds industry-specific CRM solutions on top of Salesforce for communications, government, health, insurance, media and utility companies. Salesforce’s February 2020 acquisition of Vlocity will reinforce its vertical-market offering. It took a big step in this direction in September 2019, adding consumer goods and manufacturing clouds to the banking, financial services and life sciences CRM tools it already offered.

Kronos merges with Ultimate Software

Human capital management (HCM) software vendors Kronos and Ultimate announced their merger in February 2020, although it’s a wonder it didn’t happen a year earlier. That’s when private equity firm Hellman & Friedman, already the majority owner of Kronos, took control of Ultimate too. Kronos’ CEO Aron Ain is staying on to head the combined company, while Ultimate CEO Adam Rogers is leaving. For now, both companies’ product lines will be maintained.

Koch Industries takes full control of Infor

ERP vendor Infor was already 70%–owned by Koch Industries, a privately held industrial conglomerate with interests in minerals, manufacturing, chemicals and commodities. In February 2020 it agreed to buy the remaining stake in Infor from founding investor Golden Gate Capital. Koch Industries plans to make Infor a standalone subsidiary operating under its current management. Infor’s development of industry-specific cloud suites could receive a boost from its closer ties with the industry giant. Infor had previously been ramping up for what had been expected to be a significant IPO.

Moody’s buys Regulatory DataCorp for $700 million

Regulatory DataCorp offers a range of risk intelligence and compliance screening services for enterprises, including anti-money-laundering, know-your-customer and due-diligence solutions. In February 2020 credit rating agency Moody’s acquired it for $700 million.

Visa acquires Plaid Technologies for $5.3 billion

Plaid Technologies started up as an API platform that enabled app developers such as Betterment and Venmo to build mobile apps with which consumers can access their accounts at traditional financial institutions. Later, it added a layer of analytics to the data it provided. In January 2020 it became a subsidiary of Visa, where it will operate as an independent business unit.

Insight Partners buys Veeam for around $5 billion

Backup software vendor Veeam is now under U.S. control. Investment fund Insight Partners has acquired the company, founded by Russians Andrei Baronov and Ratmir Timashev and headquartered in Switzerland. Insight will move its headquarters to the U.S. and install chairman Bill Largent as CEO, replacing Baronov. The new owner plans to invest more in Veeam’s hybrid cloud strategy and international expansion, while the company’s Americanization could open up the U.S. government market too.

ServiceNow buys Passage AI

ServiceNow has been building AI assistance into its Now Platform for workflow management for a while, but when it comes to natural language processing that language has all too often been English. With its January 2020 acquisition of Passage AI, ServiceNow will add multilingual conversational capabilities to its chatbots, potentially opening up new markets for its users.

AMN Healthcare buys Stratus Video for $475 million

In the light of the subsequent spread of coronavirus, AMN Healthcare’s January 2020 acquisition of a service provider offering video-based language interpretation for the healthcare industry looks prescient. Stratus Video offers federally mandated language interpretation services over remote video link to help medical professionals communicate with patients with limited English.

F5 Networks buys Shape Security for around $1 billion

F5 Networks’ $1 billion acquisition of Shape Security, completed in January 2020, will beef up the protection of its application delivery network business. Shape offers fraud protection for web and mobile applications by analyzing the flow of data into them, and F5 already plays a role in handling that data in many enterprises.

Hitachi buys Hitachi High-Technologies for $4.9 billion

We’ll mention this one here because there was so much money involved, but chances are you barely noticed the change after this deal closed in January 2020. Japanese conglomerate Hitachi is taking its holding in industrial equipment maker Hitachi High-Tech from 51.73% to 100% and dropping three syllables from its name. The subsidiary makes semiconductor manufacturing equipment — the machines that make the chips for servers — but Hitachi’s main focus here is improving the profitability of the subsidiary’s other business line, medical equipment, through the use of the parent company’s experience in AI and data analytics.

Copyright © 2020 IDG Communications, Inc.

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