Commentary

M&A Deals In Ad Tech Continue To Rise

Mergers and acquisitions in the technology space continue to set new post-dotcom bubble highs, according to a new quarterly update form Ernst & Young.

The company’s latest global technology M&A update -- focused on Q1 2015 -- notes that the “aggregate value of disclosed-value deals hit $77.1 billion” last quarter, “higher than any quarter since 2000.” It also represents a 16% year-over-year boost.

There were 981 deals in Q1 2015 as well, says Ernst & Young, up 29% year-over-year. It also marks a “fifth consecutive post-dotcom bubble quarterly record.”

In the third quarter of 2014, ad tech M&A activity played a significant role in the then-record quarter. That quarter was highlighted by several video ad platforms being purchased by large players, including LiveRail (by Facebook) and BrightRoll (by Yahoo).

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Ernst & Young did not highlight ad tech in its Q1 2015 report, but Jeff Liu, global sector head of technology, transaction advisory services at Ernst & Young, told Real-Time Daily that advertising and marketing M&A activity continues to increase.

“Although we didn’t focus on advertising and marketing this cycle because of the lack of big disclosed-value deals, it remains an important deal driver,” said Liu. “Sometimes in similar situations we’ve seen that the value is a matter of timing. Given the robust deal volume, we expect it to continue to drive significant volume and value, too, in the future.”

Liu said deal volume (number of deals) in advertising and marketing technology during Q1 2015 was higher than the sector’s 2014 quarterly averages -- up approximately 30%. This is significant because the total number of technology deals was up 29% year-over-year, meaning the ad/marketing tech sectors are keeping pace with the rest of the market.

Highlights of Q1 2015 M&A activity in the programmatic space include Nielsen’s acquisition of eXelate, AppNexus dishing out $100 million to buy Yieldex, Rubicon Project buying Chango for $122 million and Vector Capital buying Triton Digital, a programmatic audio firm.

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