Industry Trends
Lawmakers Urge Private Sector to Do More on Cybersecurity
Cybersecurity has become a hot topic after a series of recent cyber-attacks across the United States on oil pipeline system Colonial Pipeline, meatpacking giant JBS, and management software company Kaseya. As companies grow increasingly dependent on technology, hackers are concentrating their efforts on vulnerabilities in cyberinfrastructure. Small and large companies alike are prone to extensive system compromises, making it critical to invest in cybersecurity.1
Antitrust Lawsuit Against Facebook Dismissed by Federal Judge
In mid-December, a federal court dismissed the Federal Trade Commission and state lawyers' antitrust case against Facebook. The FTC brought this case based on its view that Instagram and WhatsApp, both owned by Facebook, might have become competitive rivals in the technology sector. The suit's allegations were found to be insufficient, and the case's rejection resulted in a 4.2 percent increase in Facebook's stock price, eventually valuing the corporation at more than $1 trillion for the first time in history.2
Robinhood Set to Pay $70 Million After Settling Regulatory Investigation
Robinhood Financial LLC has agreed to pay a $57 million fine in addition to $12.6 million in compensation to investors who have been harmed. This settlement follows allegations that the firm misled customers, approved risky trades that should have been rejected, and locked millions out of trading due to technological failures. Robinhood was a major figure in the “meme-stock” craze, ultimately locking users out of their accounts and preventing traders from entering or leaving positions.3
Bain Capital and Crosspoint Capital Partners Buy ExtraHop Networks
ExtraHop Networks Incorporated, a provider of cybersecurity services, is being purchased by private equity firms Bain Capital and Crosspoint Capital Partners. This $900 million transaction comes at a time when cyberattacks on both small and big businesses are on the rise. ExtraHop's business model consists of preventing cyber-attacks, detecting breaches, and monitoring data points in the cloud, data centers, and the Internet of Things network for threats. ExtraHop's services are becoming more essential as businesses grow and become more technologically dependent.4
AT&T Agrees to Merge Its WarnerMedia Assets with Discovery
Telecom giant AT&T and Discovery Incorporated reached a deal to combine their media assets into a new public company called Warner Bros. Discovery. AT&T shareholders will hold a 71% stake, while Discovery shareholders will own a 29% stake in the new company. AT&T will recieve $43 billion in cash, debt securities, and WarnerMedia’s retention of specific debt. The companies expect to close this transaction in mid-2022. This move comes as AT&T begins to unwind its media business portfolio and enables the company to reduce its sizeable net debt on its balance sheet faster than projected.5 6
U.S. and Taiwan Set Date to Revive Trade and Investment Talks
Trade talks between Taiwan and the United States are set to resume under the Biden Administration. Taiwan is the world’s largest supplier of advanced semiconductors, having exported computer, chips, and telecommunication equipment worth billions of dollars to the United States last year. Semiconductors are in severe shortage across the market due to increased demand since the pandemic and a push towards products like advanced electric vehicles, which require semiconductors. Establishing a better trade relationship with Taiwan to aid with supplying these products will be pivotal for future plans in the United States’ technological progression.7
Why the U.S. Rollout of 5G Is So Slow
The United States is lagging behind other countries in the rollout of 5G for several reasons, including a lack of new equipment manufactured in the United States, lack of available airwaves, and a lack of demand for 5G-enabled applications. The benefits of interconnectedness and enhanced security through 5G networks will be a game-changer once rollout becomes a more important objective. But for now, it is viewed as a non-essential improvement. 8
Largest Transactions Closed
- Target
- Buyer
- Value($mm)
-
- RealPage, Inc.
- Thoma Bravo, LLC
- $10,692.41
- Inphi Corporation
- Marvell Technology, Inc.
- $9,498.91
-
- FLIR Systems, Inc.
- Teledyne Technologies Incorporated
- $8,285.14
- Perspecta Inc.
- Peraton Corporation
- $6,791.79
- Auth0, Inc.
- Okta, Inc
- $6,500.00
- Pluralsight, Inc.
- Vista Equity Partners Management, LLC; Partners Group Holding AG
- $4,763.15
- Cardtronics plc
- NCR Corporation
- $2,688.26
- DivvyPay, Inc.
- Bill.com Holdings, Inc.
- $2,500.00
- Glu Mobile, Inc.
- Electronic Arts, Inc.
- $2,347.42
- NIC Inc
- Tyler Technologies, Inc.
- $2,339.28
Source S&P Capital IQ as of 7/7/2021 and PCE Proprietary Data
Contacts
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Data Assumptions This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only. Glossary EBIT - Earnings Before Interest and Taxes Sources:
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