Tech M&A Regulation - Thematic Research
Description
Tech M&A Regulation - Thematic Research
Summary
Big Tech’s plans to use merger and acquisition (M&A) deals to strengthen its position and expand into other markets are being dashed by regulators’ antitrust activism. Large acquisitions are subject to heavy surveillance from regulators worldwide and aspiring acquirers need to pre-emptively address concerns from regulators and be ready to make concessions.
Key Highlights
At the end of 2023, Adobe abandoned its planned $20 billion acquisition of Figma following opposition from UK and EU regulators. In January 2024, Amazon’s proposed $1.7 billion acquisition of iRobot collapsed in the face of EU scrutiny. Microsoft managed to close its $69 billion deal for Activision Blizzard in October 2023, but UK, EU, and US regulators are investigating its $13 billion investment in OpenAI, the company behind ChatGPT.
Merger control legislation is undergoing significant transformations, with regulators worldwide adopting a tougher stance on M&A enforcement. According to the EU’s Digital Markets Act (DMA), a digital gatekeeper can never be sure of whether or not its M&A activity will be reviewed by the European Commission, even if the acquired company is tiny. In the US, antitrust regulators are considering lowering the thresholds at which they will deem companies to have significant market power; the UK, India, and China are also considering more stringent obligations for large digital platforms’ M&A plans. These efforts will make it more difficult for Big Tech to get regulatory approval for further M&A activity.
Scope
This report provides an overview of the issues surrounding regulatory oversight of tech M&A deals.
It includes analysis of the M&A regulatory landscape in the EU, US, UK, China, and India.
It identifies the key trends impacting the theme over the next 12 to 24 months, split into three categories: technology trends, macroeconomic trends, and regulatory trends.
It provides an overview of recent M&A activity in the tech, media, and telecom (TMT) industry and highlights mega-deals in TMT announced between 2020 and 2023 that are currently under scrutiny or likely to face scrutiny.
Reasons to Buy
M&A deals can help companies improve efficiency and reach economies of scale, but they can also pose challenges to competition. Big Tech companies have aggressively pursued M&A activity, targeting start-ups with expertise and skills that they lack. Such acquisitions can significantly benefit consumers by supporting innovation. However, they can also raise concerns about competition when they remove potential competitors from the market or strengthen an already dominant position in a way that makes the entry of new players extremely difficult. This report will help you make sense of the issues around regulation of tech M&A. It also identifies the losers in the technology, media, and telecom (TMT) industry from the increased regulatory scrutiny of M&A deals over the next two to five years.
Table of Contents
47 Pages
- Executive Summary
- Players
- The M&A Regulatory Landscape
- M&A activity in digital markets has increased significantly
- The effects of M&As in digital markets are difficult to ascertain
- An increasingly complex landscape
- The EU
- The US
- The UK
- China
- India
- Trends
- Technology trends
- Macroeconomic trends
- Regulatory trends
- M&A Activity
- The M&A deals under scrutiny
- Regulators are going tough on Big Tech M&A
- Timeline
- Companies
- Sector Scorecards
- Top 50 global TMT
- Who’s who
- Thematic screen
- Valuation screen
- Risk screen
- Social media sector scorecard
- Who’s who
- Thematic screen
- Valuation screen
- Risk screen
- Glossary
- Further Reading
- GlobalData reports
- Our Thematic Research Methodology
- About GlobalData
- Contact Us
- List of Tables
- Table 1: Technology trends
- Table 2: Macroeconomic trends
- Table 3: Regulatory trends
- Table 4: The M&A deals under scrutiny
- Table 5: Companies
- Table 6: Glossary
- Table 7: GlobalData reports
- List of Figures
- Figure 1: How will increased regulatory scrutiny of M&A deals impact TMT companies?
- Figure 2: Digital markets acquire companies to add new revenue streams and block competitors
- Figure 3: Mega-deal volume and value in TMT plummeted between 2021 and 2023
- Figure 4: Big Tech companies were involved in over $170 billion worth of M&A deals between 2021 and 2023
- Figure 5: Four Big Tech deals were blocked by regulators or abandoned between 2020 and 2024
- Figure 6: Antitrust and merger scrutiny will represent the biggest risk for Big Tech in the near term
- Figure 7: The story of tech M&A regulation
- Figure 8: Who does what in the global TMT space?
- Figure 9: Thematic screen - Top 50 global TMT
- Figure 10: Valuation screen - Top 50 global TMT
- Figure 11: Risk screen - Top 50 global TMT
- Figure 12: Who does what in the social media space?
- Figure 13: Thematic screen - Social media sector scorecard
- Figure 14: Valuation screen - Social media sector scorecard
- Figure 15: Risk screen - Social media sector scorecard
- Figure 16: Our five-step approach for generating a sector scorecard
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