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Analysts described the fourth quarter of 2021 as red hot.
Claudia Adrien
January 31, 2022
4 Min Read
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Corporate Finance Associates Worldwide, an investment banking firm for the middle market, has released its mergers and acquisitions in the technology service industry report for the fourth quarter of 2021. The researchers analyzed the volume and aggregate value of M&A transactions, providing enterprise value data on publicly traded firms. They found an “extraordinarily high volume of transactions” and described the fourth quarter of 2021 as red hot.
Some of the more significant M&As included:
American Tower’s acquisition of data center operator Coresite for approximately $10.1 billion.
CDW’s acquisition of Sirius Computer Solutions for approximately $2.5 billion.
American Securities’ acquisition of Trace3.
Databank’s acquisition of four data centers from data center operator CyrusOne for approximately $670 million.
Variant Equity’s acquisition of CompuCom from OfficeDepot for approximately $305 million.
Wipro’s acquisition of cybersecurity consultancy Edgile for $230 million.
Unisys’ acquisition of CompuGain for $87.3 million.
Herjavec Group’s merger with cybersecurity firm Fishtech Group.
Japan-based Nomura Research Institute’s acquisition of Azure cloud solutions provider Core BTS.
Carlyle Group’s acquisition of data center operator and hybrid cloud solutions provider Involta.
Quisitive’s acquisition of Azure cloud solutions provider Catapult Systems for $51.5 million.
The IT services industry followed the broad trend with “a freeze in M&A activity when the pandemic shocked capital markets in quarter two 2020, followed by a robust rebound for a few quarters until peaking in quarter four 2021,” the report stated.
Cloud and Containers/Kubernetes
The analysts suggest that when private equity firms execute acquisitions with large corporations, they reveal the priorities and technologies that may reign supreme in the future. These technologies are often developed first for the U.S. government. Several of the companies acquired in the cloud space in the fourth quarter bolster the federal government.
Montréal-based CGI acquired Maryland-based Array Holding Company, an AWS and Azure partner that provides digital modernization services to the U.S. Department of Defense.
Private equity firm Washington Harbour Partners acquired suburban Washington DC-based AWS cloud solutions provider CollabraLink, a firm that services the U.S. Government.
Read more about other cloud acquisitions here.
Cybersecurity
Channel Futures recently covered the acquisitions made by Cerberus Cyber Sentinel, 11:11, and Wipro, as well as the merger of Herjavec Group with Kansas City-based cybersecurity solutions provider Fishtech Group.
Some of the other M&As that came to fruition in the last quarter included:
Globant acquired Atix Labs, a professional services company that provides blockchain and crypto solutions in the USA and South America.
Montréal-based managed detection and response (MDR) solutions provider GoSecure acquired Ohio-based Covail, a cybersecurity solutions provider that specializes in artificial intelligence, automation and machine learning.
IBM acquired Netherlands-based ReaQta, a threat detection and response platform.
Kroll acquired Toronto-based Security Compass Advisory, an enterprise cybersecurity consultancy with expertise in Azure and AWS.
Chicago-based managed services and professional services firm Netrix acquired Philadelphia-based cybersecurity solutions provider BTB Security.
Japan-based Itochu International made a $31.5 million investment into North Carolina-based MSSP SilverSky in October.
In early January 2022, SilverSky acquired Massachusetts-based Cygilant, a cybersecurity-as-a-service provider with a security operation center in the U.K.
Florida-based blockchain cybersecurity and backup firm Sollensys acquired Arkansas-based Celerit, a managed network solutions and cybersecurity provider that concentrates upon the financial services sector.
MSPs
Private equity continued to show MSPs love in 2021. We reported on some notable M&As during the fourth quarter, including a strategic partnership between New Charter Technologies and Spokane, Washington-based Exbabylon, a Microsoft direct cloud solution provider. Channel Futures also covered the Foxborough, Massachusetts-based Thrive acquisition of Alabama-based InCare Technologies, a managed services provider that concentrates upon the healthcare sector.
Other MSP M&As included:
Ontario-based MSP Corp acquired two Canadian MSPs.
Connecticut-based CompassMSP acquired Maryland-based managed services provider MRW Systems.
Louisiana-based managed services provider General Informatics acquired Charlotte, North Carolina-based MSP Versiant and Waco, Texas-based managed services provider Unicom Technologies.
Domain Technology Partners, a portfolio company of private equity firm Frontenac, executed a merger with the managed services providers Compudyne, ProviDyn, and MyITpros.
Portland, Maine-based MSP Logically acquired Georgia-based MSP Halski Systems, a company with roughly 50 employees.
Houston-based managed cybersecurity and SD-WAN solutions provider Meriplex acquired Boston-based Reliable IT, a managed services provider that concentrates upon the healthcare and financial sectors, and Colorado-based Optimum Networking, a managed services provider that concentrates upon the oil and gas industry.
Arizona-based Cerberus Cyber Sentinel acquired the following MSPs and MSSPs in Q4 2021: New Jersey-based managed security services provider (MSSP) Red74, New Jersey-based MSP Atlantic Technology Systems, and Chile-based MSSP Arkavia.
To learn more about how the quarter four M&As turned out for resellers, read the Corporate Finance Associates Worldwide report.
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