The digitalization of the Security Solutions industry, including technologies such as artificial intelligence (AI), Internet-of-things (IoT), and cloud computing, have driven a transformative shift from traditional security systems toward data-driven and intelligent p
As we closed these pages last year, we hypothesized that the remarkable pace of Government Information Technology (IT) mergers and acquisitions (M&A) witnessed in 2017 would continue throughout 2018, with the very real possibility that record levels of deal volume and value would be surpassed.
Last year the aerospace, defense, government and security sectors saw steady Merger & Acquisition (M&A) activity, with a focus on transactions in technology, the aftermarket, and combinations which create leaders in specific defense segments.
We are pleased to present our 2018 fourth quarter Cybersecurity Capital Markets, Mergers & Acquisitions (M&A) Update with a look back at some key trends and statistics for the year and recently closed quarter.
Year-to-date, 66 mergers and acquisitions were announced or closed in the Mapping, Modeling & Simulation industry putting activity on pace to meet or exceed 2017 activity. Strategic companies have been highly active as they leveraged acquisitions to access new customers and disruptive technology. The two largest transactions in 2018—Harris Corporation’s merger with L3 Technologies, Inc.
Fundamentals remain healthy for the C4ISR industry, as the Pentagon’s top leaders continue to emphasize that providing resilient information networks and denying enemies the use of their networks is a top priority. Such conviction is reflected in the growing portion of the defense budget related to C4ISR systems. Following the appropriations measure signed in September that allocated $674 billion in defense spending for FY2019, spending increases are prioritizing capabilities to gain and exploit information in the theater from the tactical to the strategic level.
Increased capabilities in data tracking, collecting and use are advancing analytic opportunities within the cockpit and have created a need for greater computing power in order to enhance aircraft control, safety, and functionality. In anticipation of resulting demand to upgrade cockpit equipment and instrumentation, leaders in the Avionics market are both acquiring new technologies and spurring organic growth by launching new in-house solutions.
Year-to-date the volume of M&A activity has declined versus the same period last year. However, this does not reflect the health of the broader Cybersecurity market as industry revenues, venture capital funding, and public company valuations continue to increase. The marquee transaction of the 2018 third quarter was the acquisition of Duo Security by Cisco for $2.3 billion at an eye-popping valuation of 25.0x revenue.