Monday, January 4, 2010

“Only” 43 storage mergers/acquisitions in 2009

January 4, 2010 – In a market the size of the storage industry, it would seem like 43 mergers and acquisitions in one year is a lot. Not so. That 2009 figure compares to 69 mergers/acquisitions in 2008, 84 in 2007 and a whopping 104 in the peak year of 2006.

That’s according to Jean-Jacques Maleval, as reported in his StorageNewsletter today. Here are a few tidbits I found interesting.

Jean-Jacques has been tracking mergers and acquisitions activity in the worldwide storage industry for 12 years, since 1998, and 2009 was the calmest year. (Previously, the year with the least activity was 2002, with 45 mergers and acquisitions.)

Although the total number of transactions has understandably been going down since 2006, the average per-transaction amount has been going up. For example, if you just look at the mergers/acquisitions for which the price was disclosed, there were 17 transactions in 2009, at an average of $612.2 million per deal. That compares to 25 transactions in 2008, at an average of $216.7 million per deal.

(However, it should be noted that the 2009 figure was skewed by the $7.4 billion Oracle-Sun acquisition, which Maleval includes in last year’s tally although the deal actually isn’t final yet. In comparison, the biggest single deal of 2008 was the $2.6 billion Brocade-Foundry acquisition.)

Part of the slowdown in 2009 can be attributed to EMC alone, which only acquired five companies last year, compared to 17 in 2006.

However, not surprisingly, EMC has been the most acquisitive storage vendor since 1994, racking up 62 acquisitions in that period. That’s more than double the next hungriest vendor which, somewhat surprisingly, was Seagate with 27 acquisitions.

If you’re interested in this sort of thing, check out Jean-Jacques’ report, which includes a number of interesting tables.