Tech deals during the dot-com boom
1992-2000: Tech deals during the dot-com boom
The rise of the internet follows the 1990-91 recession and the end of the Cold War. Technology, media, entertainment and telecommunications see heavy interest from investors. With the equity market funding a big chunk of M&A, deals include the AOL-Time Warner merger and the merger of Bell Atlantic and GTE to form Verizon. Annual US deal volume more than doubles during this wave, and deal value increases by more than eight times.
Long recovery from recession
2010-2019: Long recovery from the Great Recession
The global financial crisis and the worst economic recession since the Great Depression spur new regulations that contribute to a shift in M&A funding. As the equity markets finance a smaller percentage of deals, more corporate cash and borrowing enter the picture. All or mostly cash acquisitions include IBM and Red Hat, Microsoft and LinkedIn, and Amazon and Whole Foods. PE deal volume grows as investors scour the landscape for returns. Energy and healthcare draw more interest from dealmakers. The increase in total US M&A volume is again modest, but deal value hits an all-time peak and remains high. More money in the market enables even larger deals.
In short, the last three decades have brought fundamental changes in both the players involved in M&A and the money they’ve invested in deals. The mix of capital has evolved, with public financing and bank financing increasingly joined by more privately-funded transactions – all of which has created a historically large pool of capital overall.