It would be hard to top the 2018 enterprise M&A total of a whopping $87 billion, and predictably this year didn’t come close. In fact, the top 10 enterprise M&A deals in 2019 were less than half last year’s, totaling $40.6 billion.
This year’s biggest purchase was Salesforce buying Tableau for $15.7 billion, which would have been good for third place last year behind IBM’s mega deal plucking Red Hat for $34 billion and Broadcom grabbing CA Technologies for $18.8 billion.
Contributing to this year’s quieter activity was the fact that several typically acquisitive companies — Adobe, Oracle and IBM — stayed mostly on the sidelines after big investments last year. It’s not unusual for companies to take a go-slow approach after a big expenditure year. Adobe and Oracle bought just two companies each with neither revealing the prices. IBM didn’t buy any.
Microsoft didn’t show up on this year’s list either, but still managed to pick up eight new companies. It was just that none was large enough to make the list (or even for them to publicly reveal the prices). When a publicly traded company doesn’t reveal the price, it usually means that it didn’t reach the threshold of being material to the company’s results.
As always, just because you buy it doesn’t mean it’s always going to integrate smoothly or well, and we won’t know about the success or failure of these transactions for some years to come. For now, we can only look at the deals themselves.
Salesforce acquires Tableau for $15.7 billion
The biggest deal by far this year, and it wasn’t close, was Salesforce buying Seattle-based Tableau for $15.7 billion. The agreement was consummated in June, and by August it had closed — surprisingly fast for a transaction this large. Salesforce has become all about data in recent years and this purchase fits well with its Einstein artificial intelligence platform and the $6.5 billion Mulesoft acquisition last year. The two acquisitions together give Salesforce a way to access and visualize data wherever it lives in the organization.
NVidia buys Mellanox for $6.9B
The next biggest deal was big step down with NVidia buying Mellanox, a super chip maker, for almost $7 billion. There was reportedly a bidding war for this company involving Intel, Microsoft and NVidia, but it was NVIdia who walked away with the prize. It should give the company another option in the high performance computing space. NVidia GPUs are already a staple of machine learning model building.
Francisco Partners and Elliott grab LogMeIn for $4.3B
The third biggest transaction of the year came this month when a pair of private equity firms teamed up to buy Boston-based LogMeIn for $4.3 billion. The company spent $1.8 billion in 2016 to get GoToMeeting from Citrix and has been attempting to get into the unified communications space in recent years. LogMeIn still has a go-shop provision in progress where it can look for a better price, but if it doesn’t find one, the deal will close next year.
VMware snags Pivotal for $2.7B
This qualifies more as a bailout than an acquisition in a pure sense. After a poor June earning’s report earlier this year, Pivotal’s stock price began to plunge, dropping 42% in a single day. It appeared to be in serious trouble until VMware, which is also part of the Dell family of companies, came to the rescue.
Google grabs Looker for $2.6B
If you want proof that analytics was top of mind for companies this year look at Google buying Looker for $2.6 billion in June. That happens to be the same month that Salesforce bought Tableau. The interesting aspect of this purchase was that it wasn’t just about bringing Looker analytics to Google Cloud, but also to providing analytics capabilities for competitors like AWS and Microsoft.
Cisco snares Acacia for $2.6B
Cisco bought Acacia Communications for $2.6 billion, the same price as the Google-Looker deal. Acacia, makers of optical network connectors, were already a Cisco partner, so coming together made some sense. This purchase also fits well with Cisco’s mission to modernize networking.
VMware hauls in Carbon Black for $2.1B
In the same week that VMware bought Pivotal for $2.7 billion, it also opened the check book and paid another $2.1 billion for security company Carbon Black. This move fits with Pivotal and the company’s earlier move to buy Heptio as it shifts focus to cloud native technologies. With Carbon Black, it gets a security company with a cloud native focus.
Salesforce purchases ClickSoftware for $1.35B
VMware wasn’t the only company with more than one acquisition in the Top 10. Salesforce spent another $1.35 billion right after closing the Tableau purchase to snag ClickSoftware. It gave the company a field service management component for its Service Cloud.
HPE gets Cray for $1.3B
HPE joined in the M&A fun when it bought supercomputer company Cray for $1.3 billion in May. Cray has been around since the early 1970s and helped pioneer the super computer market. Now it gives HPE a significant high performance computing option for customers.
Splunk nabs SignalFX for $1.05B
And finally we have Splunk snagging SignalFX for $1.05 billion. With this acquisition, Splunk can combine its core logging skills with a cloud native monitoring solution to give customers a comprehensive set of services.
These 10 enterprise M&A deals totaled over $87 billion this year
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