In Q1 2012, the total value of deals in Europe and South American was a multiple of activity recorded in Q1 2011. This compares with steady numbers in Middle East and a small contraction in North America. Asia/Pacific suffered a 56% contraction in total deal value, while Africa recorded three deals in Q1 2012, compared with none in Q1 2011.
In Q1 2012, we tracked 636 North American deals compared with 266 in Q1 2011.
Overall the total value of deals has decreased in Asia Pacific and North America whilst the Middle East, South America and Europe have all seen growth, with Africa seeing 3 deals in Q1 2012, where previously there were none in Q1 2011. Europe, which has the highest average deal value (ADV), also has the highest percentage growth; however its increase in total deals is second to North America. This shows that in Europe in Q1 2012 there were a smaller number of deals at larger values than North America North America. In North America the total deal value decreased by 17%, however the amount of deals increased significantly showing the opposite situation, where a higher number of deals occurred with smaller values. The healthy increase in angel and series A investment activity in the North American region has been a significant contributing factor in these statistical changes.
There was an increase in the volume of deals across all regions in Q1 2012. North America maintained the highest number of deals in both Q1 2011 and Q1 2012. North America’s Q1 2011 deal number figure was greater than that of the other region’s Q1 2012 figures, demonstrating the health of Internet investment and acquisition activity in the North American region in Q1 2011 continuing into Q1 2012.
Games, hardware & infrastructure and mobile & apps all experienced cumulative value growth from Q1 2011 to Q1 2012. Transactions, media, software & services and ecommerce all saw negative growth in their cumulative values in Q1 2012 compared with Q1 2011. Games had the highest growth in cumulative deal value and it had the smallest change in the amount of deals from Q1 2011 to Q1 2012, showing a significant increase in the sectors average deal values from Q1 2011 to Q1 2012. Conversely, software & services had a negative growth in total deal value but the largest increase in the amount of deals across all sectors, suggesting a larger volume of deals at smaller average deal values.
The industry with the highest average deal value by far is hardware & infrastructure, most likely due to the dynamics of this particular sector and its higher capital requirement. The games sector comes in second with an ADV of $45.9 million.
The highlight deal in the Q1 2012 period was in the hardware & infrastructure sector, where Cisco acquired NDS Group, a UK based company, for $5 billion USD. The second largest deal was also in the hardware & infrastructure sector, where Western Digital acquired US company, Hitachi Global for $4.8 billion USD.
The largest software and services deal was Oracle’s acquisition of Taleo in February this year for $1.9 billion USD. The largest deal in the game industry was International Game Technology’s acquisition of Double Down, another US based company for $500 million USD. In the Ecommerce sector, the largest deal was Royal Ahold’s acquisition of Bol.com, another Netherlands based company for the amount of $480 million.