The Risk of Your Cloud and Data Center Vendors Being Acquired May Be Lessening

The Likelihood of Your tech Vendors Being Acquired may have Lessened
The likelihood of your tech vendors being acquired may have lessened.

Your IT infrastructure operations are integral to your organizational success, and you’ve likely invested a lot of trust in your data center, cloud, and application vendors. As these outsource partners help keep you up and running and support an optimal experience for your customers, your relationship with them is likely a critical one. If a vendor is acquired, things can change, which may not be good news for you and your company.

But when it comes to ownership changes among your tech partners, a recent survey suggests you may not have much to worry about for the rest 2016.   The most recent M&A Leader’s Survey conducted by 451 Research and Morrison & Foerster suggests that the likelihood of your tech vendors being acquired is less than it is has been in recent years.

In the survey, 33% of potential tech acquirers report that they will be slowing their merger and acquisition activity over the next six months.   38% are looking to accelerate their M&A.   This is a significant pullback in activity from recent versions of this survey over the past four years, which have averaged only 13% of companies slowing their M&A with an average of 55% of respondents looking to pick things up.

Heading into 2016 the consensus in the M&A world was that a number of attractive acquisitions had been made in the infrastructure space, and this year would see a natural gap in activity as acquiring firms waited for firms to show they were worthy of targeting. The projected slowing of M&A activity in the cloud and data center world is apparently being matched by the broader tech world as well.

If stability among technology vendors is something you value, it looks like you may have less to worry about for the rest of 2016.   And that’s likely seen as good news for the technology operations of your company.