10 Notable Technology Mergers

August 27, 2018by Nate Nead0

In today’s fast-paced, challenging, and highly competitive world, businesses are constantly fighting the good fight to maintain their competitive edge and staying at the forefront of customers’ minds. It’s no secret that technology powers our universe. As a result, many businesses have become tech ventures, capitalizing on opportunities that make them the next new tech giant of our time.
Some companies get it right, others have regrettably watched their stocks plummet, their business model fail, and their investments and acquisitions fall flat. It’s no secret that purchasing another brand, and the process of mergers and acquisitions is highly risky, regardless of industry. However, today we will look at some of the most notable technology mergers of all time.
1. Disney and Pixar – If you were to think of one of the most successful tech mergers, this one will likely be one of the first that come to your mind. In 2006, shortly before Disney reached the end of their contract with Pixar after the release of “Cars”, the merger between the two companies simply made sense. Walt Disney and Pixar could freely collaborate, which proved to be a match made in heaven.
Since then, Disney and Pixar have produced WALL-E, Up, and Inside Out. The merger also helped other divisions of Disney to produce movies such as Tangled and Frozen, which became the fifth-highest grossing movie ever.
2. Sirius and XM Radio – Up until July of 2008, Sirius Satellite radio was dominating satellite radio as the only provider. At this same time, Sirius Satellite Radio joined forces with their only rival, XM Satellite Radio.
Due to a license stipulation, it took over a year for the merger to be officially complete. However, Sirius and XM had to file the appropriate paperwork and allow the FCC to investigate the merger before an approval was granted.
Today, 70 percent of new cars come with Sirius XM pre-installed, a free 3-month trial program, which has lead to a substantial increase in revenue for the company.
3. Microsoft and LinkedIn – In June 2016, Microsoft shocked Wall Street with the announcement of their merger deal with professional social media platform, LinkedIn. Microsoft purchased LinkedIn for $26.2 billion. The deal is expected to be complete by the end of 2016.
4. Symantec and Veritas – In a digital age where security and software are in high demand, this merger only makes sense. In August of 2015, Symantec, creator of antivirus software, merged with Veritas, a data storage company, a deal worth approximately $13.5 billion.
5. Google and Motorola – Google acquired Motorola Mobility in 2012 for approximately $12.5 billion. The benefits of this deal were that the two companies together would accelerate innovation in mobile computing, which would mean that consumers would get better phones at better prices.
6. Western Digital and SanDisk – Western Digital originally planned to merge with SanDisk, the creator of the flash memory drive for $19 billion in October 2015. However, due to losing stakeholder Chinese company, Unisplendour, Western Digital ending up purchasing SanDisk for only $15.78 billion at the time of closing.
7. Intel and Altera – The merger between Intel and Altera was completed in December 2015. Intel paid $16.7 billion in cash for chipmaker, Altera, which was the biggest deal ever for Altera. Today, Altera’s chips are used in an “array of devices that include networking equipment, a field that Intel has recently targeted,” according to The Wall Street Journal.
“The acquisition complements Intel’s leading-edge product portfolio and enables new classes of products in the high-growth data center and Internet of Things (IoT) market segments,” Intel claimed in a press release announcing the deal’s completion.
8. HP and Compaq – HP acquired Compaq Computer in 2002 in an $18.7 billion deal. At the time, HP and Compaq were in the number two and number three spots for the top computer hardware companies for personal computer use. Unfortunately, the merger has been deemed as a complete failure.
9. Facebook and WhatsApp – Facebook purchased mobile messaging app WhatsApp for a whopping $21.8 billion in October 2014. Although the deal was originally valued at $19 billion, the value increased significantly due to an increase in Facebook’s stock price.
Facebook saw the tremendous growth of WhatsApp, and has kept the mobile messaging app a separate entity.
10. Avago and Broadcom – In early 2016, Broadcom announced its plan to merge with Avago Technologies, a semiconductor deal valued at $37 billion. While Avago locations in Singapore and San Jose, California purchased Broadcom, the newly merged company was renamed Broadcom Limited.

Nate Nead

Nate Nead is a licensed investment banker with Four Points Capital Partners, LLC and Principal at Nead, LLC. Nate works with middle-market corporate clients looking to acquire, sell, divest or raise growth capital from qualified buyers and institutional investors. Four Points Capital Partners, LLC is a member of FINRA and SIPC and registered with the SEC. Nate resides in Seattle, Washington.

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