In the just-completed month, buyers announced 11 tech deals valued at $1bn or more, matching the highest monthly total of billion-dollar deals during the previous two years. Yet, looking more closely at the prints at the top end of the market, one trend that barely figured into past years has been a key driver for this year: SPACs. Three of the 11 transactions valued in the billions of dollars last month were executed by so-called blank check companies.
More broadly, deal volume also picked up in August. The M&A KnowledgeBase indicates that the number of transactions last month came in more than 10% higher than the average month in the pandemic-scarred first half of the year. Several significant deals in August stood out, including:
- In last month's largest acquisition, Teledoc shelled out $18.5bn for Livongo Health. COVID-19 has created much more relevance for the e-medicine trend that drove this transaction, a fact that shows up in the astronomical valuation for Livongo Health of almost 90x its trailing sales of just $207m.
- Clayton, Dubilier & Rice paid $4.7bn for KKR portfolio company Epicor Software. The deal stands as the largest so-called secondary transaction in two years, according to our data, and comes after financial acquirers had scaled back their big-ticket purchases much more than corporate shoppers.
- Announcing its first-ever acquisition, Fastly spent $775m for Signal Sciences. The buyer is covering roughly two-thirds of the cost of the web application firewall startup with its shares, which have more than quadrupled during the pandemic.
Brenon Daly oversees the financial analysis of the Market Insight and KnowledgeBase products at 451 Research, a part of S&P Global Market Intelligence, having covered more than a quarter-trillion dollars' worth of deal flow for both national publications and research firms.
Sheryl Kingstone leads 451 Research’s coverage for Customer Experience & Commerce, which covers the many aspects of how customer experience is a catalyst for digital transformation. She oversees the company’s coverage of a variety of customer experience software markets spanning ad tech, marketing, sales, commerce and service.
Keith Dawson is a principal analyst in 451 Research's Customer Experience & Commerce practice, primarily covering marketing technology. Keith has been covering the intersection of communications and enterprise software for 25 years, mainly looking at how to influence and optimize the customer experience.