The 10 Biggest IT Solutions M&A Deals In Q2 Of 2023
‘As interest rates have risen they’ve increased the cost of capital for acquirers, so that naturally slows down the M&A market,’ John Holland, managing director of Corporate Finance Associates, tells CRN. ‘While the number of transactions fell, what it tells you is that the average transaction size increased. So there were fewer deals but there were a couple of really big deals.’
Higher interest rates in 2023 decreased technology industry M&A activity throughout the first half of the year, especially in Q2. In the second quarter, the number of M&A deals in the IT services and telecom services industries declined 15 percent from the same period last year and 15 percent from Q1 2023.
“As interest rates have risen they’ve increased the cost of capital for acquirers, so that naturally slows down the M&A market,” John Holland, managing director of Corporate Finance Associates, told CRN. “While the number of transactions fell, what it tells you is that the average transaction size increased. So there were fewer deals but there were a couple of really big deals.”
Laguna Hills, Calif.-based Corporate Finance Associates is an investment banking firm with decades of experience in executing mergers and acquisitions in the IT and telecom services industries.
“There was so much stimulus from the federal government…and interest rates were so low and money was just cheap during the pandemic that the number of M&A transactions really peaked,” Holland said. “That was bound to slow down. It can’t go on forever.”
In June, Armonk, N.Y.-based IBM acquired Bellevue, Wash.-based Apptio, a provider of financial and operational optimization software, for $4.6 billion. The acquisition will accelerate the advancement of IBM’s IT automation capabilities.
As the average deal size increased in Q2 2023 in the IT services industry, the same was observed in the telecom services industry over the same period of time. In Q2, the deal size increased by 91 percent from the same period last year.
From IBM to Accenture to Bluewave Technologies, here are the biggest IT solutions-related M&A deals in Q2 or 2023. Terms of the deals were not disclosed.
10. Absolute Performance: 2 Acquisitions
In April, Colorado-based IT solutions provider Absolute Performance, which is backed by San Diego-based Seaside Equity Partners, acquired Think Anew. Think Anew, headquartered in Tampa, Fla., provides managed services to the healthcare industry which specializes in 24/7 end user help desk and infrastructure management, Electronic Health Record (EHR) support, virtual CIO, network and telecommunications, security and compliance and cloud compute solutions.
Also in April, Absolute acquired Denver-based cybersecurity solutions provider Triton Technology Consulting which provides compliance readiness, penetration testing, third party risk management, business continuity planning and building sustainable security solutions.
9. Amplix: 2 Acquisitions
In May, Massachusetts-based Amplix, which is backed by Gemspring Capital, acquired the technology advisory and agency practice of Massachusetts-based Intervale. Intervale provides advisory services, cabling solutions and audio-visual services.
In June, Amplix acquired Massachusetts-based Corporate Accessories Group, a mobility/wireless solutions provider, which provides full-life cycle management services across mobility products.
8. Blend 360: 2 Acquisitions
In May, Maryland-based talent solutions and data analytics solutions provider Blend360, which is backed by PE firm Recognize, acquired New Jersey-based FutureproofAI, a specialist technology consultancy group known for its implementation of omnichannel decision management solutions.
In June, it acquired Uruguay-based data science and software development firm Montevideo Labs which delivers data engineering, AI and software development services to Fortune 500 companies.
7. Bluewave Technology: 2 Acquisitions
New Jersey-based Bluewave Technology Group, which is backed by Columbia Capital, raised $75 million in 2022 that fueled multiple acquisitions. In June, Bluewave acquired New York-based voice and data technology firm Total Telecom Solutions.
In July, it acquired Virginia-based telecom advisory agency OnCall Telecom which helps clients design, deploy and manage technology solutions for financial efficiency.
6. iNovex: 2 Acquisitions
In May, Maryland-based software development and engineering firm iNovex, which is backed by Enlightenment Capital, acquired Maryland-based Innoplex, a provider of software engineering services and cybersecurity services.
In June, it acquired Maryland-based Secure Innovations, a cybersecurity solutions provider, to further provide services to the US Government.
5. Sourcepass: 2 Acquisitions
In May, New York City-based Sourcepass, which is backed by Metropolitan Partners, announced it raised an additional $65 million in funding, bringing their total funding to $135 million. That same month it acquired Virginia-based IT solutions provider Proxios expanding its presence in the mid-Atlantic states while broadening its client base in the healthcare, legal and non-profit industries.
That same month it acquired Colorado-based MachineLogic to expand into the Western US region and offer additional service and account management professionals.
4. 10Pearls: 2 Acquisitions
In April, Virginia-based solutions provider 10Pearls acquired UK-based Symbox which provides enterprise software solutions and business services to telecommunications, media and entertainment organizations.
In May, it acquired Colombia-based services firm Oiga Technologies that specializes in artificial intelligence, machine learning, big data and blockchain.
3. IBM: 3 Acquisitions
In April, Armonk, N.Y.-based IBM acquired Silicon Valley-based SaaS provider Ahana Cloud and Polar Security in June. Silicon Valley-based Polar Security is a data security posture management platform.
In June, it acquired Bellevue, Wash.-based Apptio, a provider of financial and operational optimization software, for $4.6 billion. The acquisition will accelerate the advancement of IBM’s IT automation capabilities.
2. The 20 MSP: 5 Acquisitions
Dallas-based MSP The 20 MSP, which is backed by Pinecrest Capital Partners, acquired five MSPs in Q2. It acquired Kansas-based UNI Computers, Florida-based CyberSecure IT Solutions and Oklahoma-based The Computing Edge. All three MSPs demonstrated year-over-year growth and deepen The 20’s rapidly expanding national footprint and strengthen its expertise in cloud solutions, cybersecurity, IT consulting and business continuity.
It also acquired California-based Computer Support Team to strengthen the growing company’s position as a national, coast-to-coast MSP with a focus on cybersecurity and cloud computing. The fifth acquisition was Virginia-based Manus Dei in June which will open The 20 to new markets.
1. Accenture: 7 Acquisitions
Accenture announced or completed seven acquisitions in Q2. Oslo, Norway-based Einr AS was acquired in April and is a business consulting first that specializes in high volume logistics solutions using SAP technologies. In May it acquired Coventry, U.K.-based Objectivity, a digital engineering firm that specializes in cloud and platform development services.
In May, it acquired Sao Paulo, Brazil-based Green Domus, a consulting firm which helps clients design and implement a host of sustainability services with a focus on measurable decarbonization strategies. In June it acquired Melbourne, Australia-based Bourne Digital, a digital design agency with a focus on the SAP ecosystem.
Also in June, it acquired New York and Austin, Texas-based Nextira, an AWS premier partner that uses AWS to deliver cloud-native innovation and predictive analytics. Next was the acquisition of Santa Ana, Calif.-based Anser Advisory to help its clients complete large, long-term infrastructure projects more efficiently.
It completed the acquisition of Flutura in June as well. Flutera is a Bangalore, India-based company that strengthens Accenture’s industrial AI services to increase the performance of plants, refineries and supply chains and enable clients to accomplish net zero goals faster.