Driving Tech Growth: Key Trends in the M&A Advisory Space

Key Takeaways

While recovering from a recession in 2023 and 2024, the M&A market is expected to recover in 2025 with CEOs using strategic acquisitions to adapt to changes in AI and sustainability.
Leading global investments for innovation and expansion are tech companies. More technology-related acquisitions spanning a range of businesses are expected by experts to follow this trend.
Using M&A and private equity investments, companies can create value. Smaller, deliberately coordinated transactions are more beneficial for companies since they allow them flexibility and lower risk.

If you’re looking for a deeper dive into the trends shaping the technology industry, 2025 Business Outlook Trends in Technology covers key developments in AI, cybersecurity, cloud computing, and more. Find out how these trends will affect your business and what you can do to stay ahead.

Managing the M&A Environment: Applied Technology, Strategic Development, Resilience

Are you ready to capitalize on mergers and acquisitions to fuel your company’s success in the rapidly advancing tech industry?

The CEO’s focus on artificial intelligence and sustainability is positioning companies to capitalize on the anticipated rebound in the global M&A market, despite recent slowdowns in activity. The technology sector’s pivotal role in driving M&A activity highlights the need for strategic acquisitions to improve portfolios and produce long-term value. Success mostly depends on flexibility, critical thinking, and grabbing fresh opportunities.

Fortitude of the M&A Market

M&A is, according to CEOs, a necessary tactic particularly in light of major shifts like the acceptance of sustainability projects and artificial intelligence. Programmatic purchases—a technique of constantly adjusting portfolios through acquisitions and divestments with a strategic intent—usually help businesses outperform those using other strategies. This trend emphasizes strategic importance and tenacity of the M&A industry.

Tech Sector Dominance

The technology industry maintained its lead in M&A with $640 billion in transaction activity in 2024, a 16% increase over 2023. As technology becomes increasingly integrated across industries, well-capitalized corporations are projected to drive major acquisitions in 2025, aided by a favorable antitrust environment and a rise in takeover deals. These patterns highlight how important the IT industry is in influencing innovation and world economic development utilizing strategic M&A.

An Eye for Portfolio Optimization

Companies trying to boost value should carefully review all business divisions to identify the most profitable ones. Using the benefits of scale will help one to create a dominant position in some company sectors, therefore increasing value. Companies applying this approach have to be always evaluating and enhancing their portfolios.

Difficulties and Opportunities

Dealmakers must move with the times as the presumptions about value-generating strategies and growth models evolve. This means grabbing new opportunities and deftly overcoming challenging hurdles. The ability to remain adaptable and responsive to changes in the market will help M&A activities to be successful.

Promoting Tech Growth and Scalability Using M&A Advisory Services

Strategic Buyouts

Software Companies: Usually, they buy intellectual property and fresh employees. One application of this approach is Cisco Systems’ purchase of cybersecurity firm Splunk. With this kind of acquisition, companies can increase their technological capacity and innovate faster.

Media Industry: Consolidation in the media sector continued in 2024, highlighted by Skydance Media and RedBird Capital’s $2.4 billion acquisition of Paramount Global. However, the year was also marked by “legacy media travails,” with widespread layoffs and consolidations across major media outlets.

Telecom Operators: One of their key approaches is portfolio optimization via joint ventures and acquisitions in telecom operators. This helps them to extend their market share and enhance the services provided.

Programmatic M&A

Many times, the execution of a sequence of smaller, strategically timed agreements maximizes value. Usually, this strategy beats targeted M&A strategies or large, one-off acquisitions.

Programmatic M&A lets companies progressively include new capabilities, so reducing risk and boosting flexibility. It also allows continuous portfolio management, therefore ensuring congruence with long-range strategic goals.

With surplus overall shareholder returns of 2.3%, this method regularly beats others. It helps companies to keep being flexible and fast to grab market opportunities. Careful integration of new acquisitions helps companies to lower integration risks and scale effectively.

Private Equity (PE) Involvement

Private equity firms are increasingly becoming involved in M&A. They intend to boost their profits by joining software companies or making consistent returns investments in telecom infrastructure. Their involvement usually adds a significant sum of money and expertise, which inspires creativity, value creation, and market growth. Through better strategic direction and operational efficiency, PE companies speed up their development and competitive advantage.

Increased Value with M&A Advisors

Studies demonstrate that companies dealing with sell-side M&A consultants have greater value multiples. In mergers & acquisitions, consultants should be sought-after professionals. They promise correct arrangement and execution of transactions. This highlights the need for professional advice in such kind of situation.

Mergers and acquisitions cannot succeed without experienced consultants. By providing vital insights and negotiation experience, M&A advisors maximize transaction results and shareholder value.

Trends in TMT (technology, media and telecommunications)

TMT’s Use in M&A: Function

Mergers and acquisitions are still how TMT companies grow income and lower investment costs. In Q3 2024, the TMT sector accounted for 17.2% of global M&A value and 14.5% of deal count. This covers a lot of activity from telecom carriers improving their portfolios by means of acquisitions, media sector conglomerations, and software companies acquiring staff and intellectual property. The company’s fast technical developments and dynamic character enable it to be a center for continuous mergers and acquisitions.

Digital Disruptors

Companies who close more than five deals a year grow twice as quickly as their competitors. Using acquisitions to hasten growth and technology to enhance their competitive edge, digital disruptors Their aggressive approach helps them to rapidly apply innovative ideas and lead ahead of market trends.

Excellent Compliance with Corporate Plans

As M&A activity heats up, TMT players must craft targeted, focused M&A strategies that complement their overall goals. This link assures us that purchases support long-term business objectives and offer sustainable value. Companies that maintain strategic coherence are more suited to promoting teamwork and maximizing the returns on their mergers and acquisitions.

Unlocking Value in Technology by means of Strategic M&A

The increase and expansion of the tech sector in the M&A advising market shows resilience, industry leadership, and strategic portfolio optimization. Companies must change to fit evolving models and strategies, apply programmatic M&A, strategic acquisitions, and private equity involvement if they are to achieve development. The ongoing relevance of the TMT sector emphasizes the requirement for M&A advisors and offers chances for people to overcome challenges in this sector.

One should not minimize the strategic importance of mergers and acquisitions in advancing technical development and expansion. Companies that are utilizing strategic potential are growing noticeably, which underlines the need to be proactive in M&A notably in the technology sector. Thanks in part for national and outside vendors, companies are quickly inventing new technology. Leading companies define the benchmark for technological creativity.

Consulting professionals and following a sensible M&A strategy will help companies reach long-term expansion. This suggests that companies should engage experts and have a clear merger and acquisition plan.

By doing this, companies might have better knowledge of the complexities related to M&A and make more educated judgments. Ultimately, it could lead to the ongoing success and growth of the company.

Through proactive and imaginative mergers and acquisitions, companies could keep their tech sector competitiveness. They can now gain from the fast technological developments. Businesses have to move with the times if they are to remain competitive in a field seeing fast transformation.

Companies that aggressively pursue mergers and acquisitions set themselves up for success and technological sector expansion. They advance their own technology and use professional consulting services.

Is your company ready to unlock the potential of M&A in the tech sector?

Partnering with experienced M&A advisors is key to navigating this complex landscape. Contact LBMC today to start crafting a strategic M&A plan that aligns with your growth objectives and keeps you competitive in this rapidly changing field.

Want to learn more about key technology industry trends? Read our Technology Trends blog.

Content provided by Brian Marynowitz, CPA. Brian is a Shareholder in the LBMC Transaction Advisory Services practice. He specializes in providing financial due diligence services for both strategic and financial buyers across a broad range of industries. Brian has advised on the buy-side and sell-side of transactions ranging in value from several million dollars to over $4 billion dollars, including public company and cross-border transactions. Contact Brian at brian.marynowitz@lbmc.com. 