August 22, 2018

View from the Bay: trend-spotting in M&A's epicenter

Shelle Martin, Senior Director at Merrill DataSite | August 22, 2018

Because I work with a broad spectrum of Bay Area dealmakers, I’m often asked, “what are you seeing?” Clients want to know what local M&A trends I’m spotting and what common issues are on the top of people’s minds.

West coast technology remains the epicenter of upcoming deal activity, according to the latest Deal Drivers heat map. The report flags industry convergence, heightened private equity interest, the expanding use of artificial intelligence (AI), big data and Internet of Things (IoT) applications as driving M&A.

Meanwhile, here’s my take on what dealmakers are talking about on the ground:

  • Artificial Intelligence (AI) technologies are being snapped up left and right, even at extremely elevated valuations.
  • Autonomous car start-ups are multiplying rapidly.
  • Deals are smaller with shorter buyer exclusivity periods (nothing more than a month).
  • Many companies have dabbled with an IPO and then pulled back.
  • When it comes to potentially sourcing new targets, finding off-the-beaten path companies remains a huge challenge.
  • Auction processes keep getting tighter and more competitive.
  • New deal sourcing processes to better originate (and hold on to) potential acquisitions.

Another thing we continue to see is that the major hesitation to more acquisitions isn’t elevated valuations, it’s successfully integrating previous deals.

Contact Merrill to find out how we help you address local due diligence challenges.

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