The 15 Biggest M&A Deals Of 2015 (So Far)


In the first six months of 2015, some major mergers and acquisitions took place in the IT industry.

This year we have seen deals that have reshaped the telecom community, solution providers being snatched up by private equity firms, and big-name companies making deals in order to keep up with emerging technologies. And we're only halfway through 2015.

Here's our take on the 15 M&A deals that will have the most impact on the channel.

For more on the "coolest" of 2015, check out "CRN's Tech Midyear In Review."

Thoma Bravo, Teachers' Private Capital Take Riverbed Private

In late April, private equity firm Thoma Bravo and the Ontario Teachers' Pension Plan completed the acquisition of Riverbed Technology, a deal first disclosed in mid-December, for approximately $3.5 billion.

The move to go private via the Thoma Bravo deal came after Riverbed already had spurned an offer from activist investor Elliott Management, which had been pushing the company's board to sell.

Riverbed partners at the time said the deal would allow Riverbed to break away from a slowdown in growth in the WAN acceleration market.

Sophos Acquires Reflexion Networks

In mid-May, CRN learned Sophos was moving to buy popular SMB email security and archiving company Reflexion Networks, and then Sophos a few weeks later made it official. Terms of the deal were not disclosed.

The deal gives Sophos a bigger footprint in the SMB cloud market, where Reflexion has a robust, loyal channel following.

The intent of the deal is for Reflexion's technology to help significantly boost Sophos' MSP offerings and bolster its cloud-based email security. In addition, Sophos said at the time of the deal that Reflexion potentially will allow for better integration with professional services automation and remote management and monitoring platforms such as Autotask and ConnectWise.

DLT Solutions Acquired By Millstein & Co.

DLT Solutions revealed in early February that it was acquired by private equity firm Millstein & Co. for an undisclosed amount, making DLT the only solution provider Millstein & Co. owns.

DLT, No. 35 on the 2015 CRN Solution Provider 500, previously was owned by TZP Capital Group, and is a premier public sector solution provider with more than $900 million in revenue 2014.

Shortly after the deal, DLT Solutions named venture capitalist and entrepreneur Chris Lynch to its board of directors.

"Our thesis is to really grow, protect the legacy, protect the machine and grow the business," Smith said in an interview with CRN after the news.

HP Buys Aruba Networks For $3 Billion

In mid-May, Hewlett-Packard completed its much-talked-about acquisition of Aruba Networks for the sum of $3 billion, after the deal was revealed by the companies in early March.

Aruba Networks generated revenue of $729 million in its most recent fiscal year prior to the deal and manages wireless networks and provides security for mobile devices.

The deal is aimed at giving a boost to HP's networking business and to offer Aruba's services to its enterprise customers.

Some HP partners said at the time that the deal puts pressure on Cisco Systems and would allow HP to take wireless share away from the company.

Bain Capital Buys Blue Coat For $2.4 Billion

Bain Capital acquired security firm Blue Coat Systems from fellow private equity firm Thoma Bravo in late May in a $2.4 billion all-cash deal. The agreement was revealed in early March.

Blue Coat services more than one-third of the companies on the Fortune 500 with its security solutions. The security firm went private in 2011 when Thoma Bravo purchased it for $1.3 billion.

The 100 percent channel-focused company looks to re-enter the public market and drive revenue to $1 billion within three years from $450 million in 2012.

PCM Buys En Pointe For $15 Million Plus Earn-Outs

In early April, PCM closed its acquisition of $393 million solution provider and systems integrator En Pointe Technologies for $15 million. The deal also included certain earn-out considerations over the next three years, including 22.5 percent of the future adjusted gross profit of the business and 10 percent of certain service revenue.

En Pointe, one of Microsoft's largest licensing solution providers in the country, is PCM's largest acquisition to date. The company said the deal will help it broaden its reach in both the commercial and public sector segments of the company.

"After you cycle through all the benefits of the acquisition and the sales that it brings to the table, we are optimistic that both entities together can start growing at 10 percent-plus one year out," said PCM CEO Frank Khulisi during the company's earnings call April 29.

Nokia Buys Alcatel-Lucent For $16.6 Billion

In mid-April, Nokia acquired French rival Alcatel-Lucent for $16.6 billion.

The two companies will form as Nokia Corporation and will be the second biggest mobile equipment maker in the world in terms of market share behind Ericsson. The deal is expected to close in the first half of 2016, putting pressure on Ericsson, Huawei Technologies and Cisco.

When the deal closes, Nokia Corporation will have a market share estimated at about 35 percent, only behind Ericsson's 40 percent.

Some solution providers said at the time of the deal that the move is great for Nokia as they view Alcatel-Lucent as ahead of the competition in some routing and switching spaces like the data center.

Fortinet Acquires Meru Networks For $44 Million

Fortinet in mid-July acquired Meru Networks in a deal valued at approximately $44 million.

Meru Networks, a $90.9 million secure wireless company, gives Fortinet an entry into the enterprise security wireless market, where it will compete against the likes of Cisco and other major networking players looking to lead in the security space.

Fortinet said after the deal that the acquisition allows the company to add layers of security to enterprise clients, specifically around BYOD.

Joe Sykora, Fortinet vice president of Americas sales, told CRN in May that he believes the Meru acquisition positions Fortinet to win against established competitors in the enterprise secure wireless market.

Cisco Snapping Up Piston Cloud

Cisco in early June agreed to acquire OpenStack specialist Piston Cloud Computing to accelerate its Intercloud strategy. The terms of the deal were not disclosed.

Cisco launched Intercloud in 2014 with the goal of creating a global network of connected public, private and hybrid clouds.

With the four-year-old startup's expertise and distributed systems engineering, Cisco plans to enhance its capabilities around cloud automation, availability and scale to complement its Intercloud strategy.

Cisco has made a total of five acquisitions in just the past four months including Piston Cloud. The networking giant also has closed on or agreed to acquire MaintenanceNet, OpenDNS, Tropo and Embrane.

EMC Buys Virtustream For $1.2 Billion

Storage giant EMC said in late May it was stepping into the cloud provider market with its agreement to acquire cloud computing company Virtustream for $1.2 billion. The deal closed in early July.

Virtustream specializes in cloud computing management, in addition to software and Infrastructure-as-a-Service, allowing EMC to broaden its presence in the ever-growing cloud market.

EMC already owns a controlling stake in VMware but will not be competing against its own commodity in VCloud, instead looking to take share away from AWS in enterprise markets.

Accuvant-FishNet Complete $1.5 Billion Merger

Competing security firms Accuvant and FishNet Security completed their merger in early February, creating a security behemoth worth $1.5 billion. The deal was revealed in November.

The new combined company will launch as Optiv Security this summer. It is primarily owned by Blackstone Group, which acquired a majority of Accuvant in March of last year.

The combined entity has more than 60 locations across the U.S., Canada and FishNet's office in London. Perhaps most important is the broad portfolio the combined companies now feature, as Accuvant CEO Dan Burns said at the time of the deal the two companies will feature "end-to-end solutions ranging from strategy to tactical and everything in between."

SoftwareOne Buys CompuCom's Software Licensing Business

In mid-March, $3.3 billion solution provider SoftwareOne, No. 14 on the 2015 CRN Solution Provider 500, acquired the software licensing business of $2.2 billion solution provider CompuCom.

Both SoftwareOne and CompuCom are two of Microsoft's biggest and oldest partners, and two of the vendor's 15 licensing solution providers.

CRN reported in November that Microsoft was thinking about revoking CompuCom's LSP status because it was missing revenue targets and hadn't invested enough in technical certifications.

Intel Buys Altera For $16.7 Billion

In early June, Intel agreed to acquire semiconductor manufacturer Altera for $16.7 billion to bolster its Internet of Things business.

Intel has making a big push into IoT as it reported $2.1 billion in sales in that business segment in 2014, up 19 percent from the $1.8 billion it reported the prior year. The move toward IoT as well as data centers is an attempt by Intel, the world's largest chip maker, to expand its business outside of the struggling PC market.

Intel said at the time that the deal is expected to close within six to nine months.

Avago Buys Broadcom $37 Billion

In late May, Avago revealed it will buy rival semiconductor manufacturer Broadcom in a $37 billion deal. Broadcom will adopt the name Broadcom Limited when the acquisition closes, slated for the first quarter of next year.

The company manufactures networking interface cards for data, voice and video applications in the wireless and broadband communications space. The company offers a variety of out-of-the-box connectivity platforms for connected devices and the Internet of Things, such as home automation, beacons and connected cars.

The deal is intended to propel Avago even further into the client computing, mobility and Internet of Things markets.

The combined entity is expected to have annual revenue of $15 billion and an enterprise value of $77 billion.

Charter Communications Buys Time Warner Cable For $56 Billion

In late May, telecom behemoth Charter Communications closed the biggest financial acquisition of the year so far in its purchase of Time Warner Cable for $56 billion. Along with the buy of the $78.7 billion cable telecom company, Charter also agreed to a deal to buy Bright House Networks for $10.4 billion.

In combination, the three companies form a broadband services company that will serve 24 million customers, just behind Comcast, which serves 27 million.

"This does create a new powerhouse with two very channel-friendly organizations in Time Warner and Charter," Vince Bradley, president and CEO of World Telecom Group, a Malibu, Calif.- based carrier services master agent who partners with TWC and Charter, said at the time of the deal.

The deal signals the growth of telecom services and a need for solution providers to grow their presence in that market.