NEW YORK-Not surprisingly, the number and size of mergers and acquisitions for which a dollar value was made public declined markedly in all industries when compared to the same period a year ago, Los Angeles-based Mergerstat reported.
Announced transactions involving U.S. companies totaled 2,224, down from the record of 2,637 set during the first quarter of 2000. The aggregate sum of disclosed deal value was $188.3 billion, compared with $339.2 billion during the year-ago quarter.
So-called “megadeals,” those valued at $1 billion or more, totaled $118.5 billion last quarter, well below the $294.3 billion in such transactions announced during the first quarter of 2000.
Among companies in sectors related to telecommunications, five transactions last quarter fell into the megadeal category. The $5 billion acquisition of Sema plc by Schlumberger Ltd. was the largest in the sector and ranked sixth among the 10 largest mergers and acquisitions in all industries during this period.
Sema provides enabling technologies for short message service and instant messaging and prepaid and post-paid billing for next-generation wireless services, among other offerings.
According to an April 9 announcement, the New York-based Schlumberger Test and Transactions division, which develops smart cards, will henceforth be called Schlumberger Sema. Irwin Pfister, executive vice president in charge of the Test and Transactions unit, now holds the same position at Schlumberger Sema.
Other megadeals involving telecommunications-related companies included the $2.4 billion acquisition of Dallas Semiconductor Corp. by Maxim Integrated Products. Nortel Networks’ purchase of JDS Uniphase Corp., which makes computer chips for optical networks, was valued at the same amount.
Also topping the $1 billion threshold were the Siemens AG acquisition of Efficient Networks Inc., a digital subscriber line manufacturer, for $1.4 billion and the Vodafone Group plc purchase of Japan Telecom Co. Ltd. from AT&T Corp. for $1.3 billion.
Communications companies followed the downward trend in transactions last quarter, announcing 88 mergers and acquisitions, compared with 141 during the first quarter of 2000. Of the 88, 44 involved buyers engaged in communications other than radiotelephone, while 35 were classified as involved in telegraph and other message communications.
Computer software, supplies and services companies retained their first-place standing in the year-to-year comparison, although the 610 deals in this sector last quarter were well below the 729 total announced a year earlier.
Electrical equipment companies announced 64 deals during the first three months of this year, down from 86 a year ago, while electronics companies held steady at 48 transactions, the same as the posted during the first quarter of 2000. Singapore-based Flextronics International Ltd. ranked among the most active foreign acquirers of American companies, having announced two purchases through March 31. Flextronics is an outsourced manufacturer of consumer electronics devices, including wireless handsets.
All told, Mergerstat counted 132 transactions involving telecom-related companies during the first quarter of this year. Of these, 51 publicized an estimated deal value that totaled $13.8 billion.
By comparison, there were 141 communications mergers involving U.S. companies during the year-ago quarter, and a total announced transaction value of $19 billion. Computer, software and services firms posted 716 transactions and a published aggregate value of $239 billion. Electrical equipment companies announced 86 transactions and a total public valuation of $19.7 billion. Electronics companies posted 48 acquisitions and an overall announced value of $23.5 billion.
