Tech Deals Led IPOs in Second Quarter
Technology deals led the charge in a resurgence of initial public stock offerings, accounting for 40% of the value of all IPOs in the second quarter, according to PwC.
The 11 transactions amounted to $4.5 billion total, with three of them garnering more than $500 million each, the company says in its "US technology M&A insights Q2 2011 update" report.
[GOOGLE's M&A: Motorola Mobility is by far Google's biggest acquisition ever]
The report flags IPOs by LinkedIn, Yandex (Russian search), Freescale Semiconductor, Pandora (music), Groupon (shopping) and Zynga (games) as notable. It mentioned one case in which a privately held firm was released to the public by its private-equity holder - Avaya. The company had been held by Silver Lake and TPG.
The report says IPOs of companies held by private-equity firms may become more popular vs. sale to another company as a way to divest. "IPO exits in place of divestitures may be expected from financial sponsors in future months as firms take advantage of a robust IPO market," the report says.
PwC also notes that some major tech companies spent more than $1 billion each to buy up companies for their technology rather than build it themselves. Those were Qualcomm buying Atheros chipsets, Verizon buying Terremark's data centers, and Nokia Siemens closing its deal to buy Motorola's wireless network assets.
The Qualcomm deal ($3.5 billion) was the top valued acquisition of the quarter, with Verizon's ($1.4 billion) coming in at No. 4.
The report cites five factors as the driving forces behind all tech acquisitions: convergence of technology sectors; proliferation of mobile devices; cloud security; virtualization; and consumerization if IT.
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