The Deals, the Data and the Drivers

October 15, 2014

Douglas Cogen, Fenwick & West corporate partner and co-chair of the mergers and acquisitions group, was quoted extensively in a Mergermarket article based on a third-quarter report that analyzes leading technology, media and telecommunications (TMT) transactions and trends so far this year.

Fenwick was ranked top M&A legal advisor for TMT transactions worldwide by volume for the first three quarters of 2014 by Mergermarket.

According to the Mergermarket article, 2014 TMT transactions already total $495 billion, compared with $508 billion for all of 2013, and these deals have contributed to more than 15 percent of global M&A.

"Overall," Cogen told the publication, "valuations in TMT have been healthy, showing significant expansion over 2013 as a result of the now long-standing bull market having driven overall enterprise values to levels not seen in many years."

Cogen also attributed the health of TMT deals to the fact that the technology sector has a continual need to round out product portfolios and expand into adjacent markets. In addition, he said, U.S. companies interested in strategic acquisitions want to use their large cash reserves when capital markets are open to quality debt and equity offerings to fund deals.

Another factor for the sector's strength, Cogen said, has been major divestitures, including the Hewlett-Packard Company's plan to spin-off its PC and printer unit and eBay's intention to spin-off PayPal.

According to Cogen, one other noteworthy TMT trend is increased deal-making between the United States and the Asia-Pacific, "as Asian players strong in home markets, such as Alibaba (China) and Rakuten (Japan), seek an increased presence in the U.S. tech ecosystem across customer, partners and engineers."

The full article, “The Deals, the Data & the Drivers: TMT Deals Surge Forward Through 3Q14 Despite Heady Valuations,” is available through the Mergermarket website (subscription required).