According to a newly released IDC study, the worldwide enterprise applications market saw a spectacular amount of merger and acquisition activities in 2005. The study finds the number of deals in 2005 climbed to 199, compared with 144 in 2004, and the value of these deals more than doubled to over $36 billion. In addition, there were seven deals worth more than $1 billion in 2005, compared with only one in 2004.
"By almost every measure, the pace and value of enterprise application mergers and acquisitions went through the roof in 2005," said Albert Pang, research director of Enterprise Applications at IDC. "However, that doesn't mean the market is likely to go the way of traditional industries, with only a handful of players left competing for the shrinking pie. Instead, the future is likely to be marked by continuous product and customer innovation from best-of-breed vendors as well as visionary players who know what it takes to stay financially viable as well as technologically advanced. These vendors will emerge as category champions and ultimately industry leaders for many years to come.''
Regionally, there was an across-the-board increase in the number of enterprise application deals impacting Europe, Asia/Pacific, and North America. IDC expects the numbers of mergers and acquisitions involving Europe and Asia/Pacific to rise dramatically throughout 2006, as hungry investors and vendors seek to replicate their expansion strategies in new locations.
In terms of vertical industry breakdowns, the horizontal enterprise market accounted for the biggest percentages of deals in 2004 and 2005, followed by financial services, and engineering. Additional vertical industry vendors that were highly sought after in 2005 include: retail, healthcare, banking, and manufacturing.
The IDC study, Buyout Billboard Shows Acquisition Overdrive in Enterprise Applications Market in 2005 (IDC #34761), offers an exhaustive analysis of the wave of mergers and acquisitions that has continued to rise with each succeeding quarter since the beginning of 2004. The study provides detailed information on the acquirers, the vendors acquired, and the types of applications and technology assets purchased. Other data points include announced dollar amounts of transactions, number of customers affected, and regional and vertical industry dimensions of the deals. Also included is a future outlook of the enterprise applications market and types of players, and essential guidance for vendors.
"By almost every measure, the pace and value of enterprise application mergers and acquisitions went through the roof in 2005," said Albert Pang, research director of Enterprise Applications at IDC. "However, that doesn't mean the market is likely to go the way of traditional industries, with only a handful of players left competing for the shrinking pie. Instead, the future is likely to be marked by continuous product and customer innovation from best-of-breed vendors as well as visionary players who know what it takes to stay financially viable as well as technologically advanced. These vendors will emerge as category champions and ultimately industry leaders for many years to come.''
Regionally, there was an across-the-board increase in the number of enterprise application deals impacting Europe, Asia/Pacific, and North America. IDC expects the numbers of mergers and acquisitions involving Europe and Asia/Pacific to rise dramatically throughout 2006, as hungry investors and vendors seek to replicate their expansion strategies in new locations.
In terms of vertical industry breakdowns, the horizontal enterprise market accounted for the biggest percentages of deals in 2004 and 2005, followed by financial services, and engineering. Additional vertical industry vendors that were highly sought after in 2005 include: retail, healthcare, banking, and manufacturing.
The IDC study, Buyout Billboard Shows Acquisition Overdrive in Enterprise Applications Market in 2005 (IDC #34761), offers an exhaustive analysis of the wave of mergers and acquisitions that has continued to rise with each succeeding quarter since the beginning of 2004. The study provides detailed information on the acquirers, the vendors acquired, and the types of applications and technology assets purchased. Other data points include announced dollar amounts of transactions, number of customers affected, and regional and vertical industry dimensions of the deals. Also included is a future outlook of the enterprise applications market and types of players, and essential guidance for vendors.
