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Global M&A Trends in Technology, Media & Telecommunications: 2021 Mid-year Update

The first half of 2021 suggests a banner year for TMT M&A—as digitisation and disruption meet abundant capital for deal-making.

The first half of 2021 saw continued optimism in global technology, media and telecommunications (TMT) M&A activity with record capital supply and investments triggered by initial public offerings (IPOs) of special-purpose acquisition companies (SPACs), and venture capital (VC) funding. Three trends, in particular, define the current TMT M&A landscape globally.

  • Media streaming: Streaming services like Netflix and Disney+ were the initial winners of the COVID economy. However, in 2021, their subscriber acquisition rates have slowed due to changing consumer behaviour as a result of the vaccine roll-out and increased competition from new players. As seen by the Warner/Discovery merger and Amazon’s acquisition of MGM, increased competition is also encouraging consolidation allowing companies to compete based on scale.
  • SaaS and deep tech: Although software as a service (SaaS) continues to lead the way in the tech sector, deep tech is gaining ground fast as companies focus on capability-building and value creation. As technologies like quantum computing, space exploration, and energy storage make headway towards commercialisation and receive more VC investment, IPO and M&A activity could be imminent. As seen with IonQ’s historic SPAC deal announced in March 2021, making it the first publicly traded pure play quantum computing company, we may see more breakthrough moments for deep tech soon.
  • Sovereignty: Another shift that could create challenges for cross-border deals in 2021 is a move from globalisation towards increased sovereignty and protectionism. We are seeing several recent examples of government scrutiny on data, privacy and cryptocurrency laws, including the strict privacy laws imposed against social media companies in India, recently passed legislation on digital advertising in Australia, and cryptocurrency bans in China.
  • We remain optimistic about the TMT industry’s outlook for value-creating M&A for the rest of 2021. Due to the opportunities for digitisation and disruptions on the horizon, and fuelled by the availability of capital, companies will continue to consider deals as a way to build new capabilities, reshape their businesses and maintain or attain market leadership.

“Industry disruptions and huge opportunities from digitisation and technology, combined with the availability of capital, create a foundation for continued record M&A activity. We should expect new and thriving companies to be leading the charge on acquisitions, not just big tech players.”

Marc SuidanGlobal Technology, Media & Telecommunications Deals Leader, Principal, PwC US

M&A hotspots

We expect the following areas to be M&A hotspots during the next six to 12 months:


Cryptocurrency deals could grow rapidly in the second half of 2021—both in M&A and fundraising—as the industry matures, with large players looking to institutionalise:

  • In June 2021, Andreessen Horowitz announced a US$2.2bn crypto fund, betting on the important role that crypto will play in the next wave of computing innovation.
  • Combined deal value more than doubled in 2020, year-over-year, to US$1.1bn.
  • The average deal size increased from US$19.2m in 2019 to US$52.7m in 2020, and the number of deals valued at over US$100m also grew over the same period.
  • M&A activity is happening globally, with 60% of transactions taking place in Asia-Pacific and EMEA.
  • Deals made in early 2021 have focused on trading and exchange infrastructure, representing 42% of cryptocurrency transactions.

Disruptive technology

Highly concentrated industries could present an opportunity for disruption and M&A activity in the near future as companies deploy disruptive technology to lower costs, grow revenues, and redraw competitive boundaries. Historically, we’ve seen new players emerge to shake up previously highly concentrated industries and a select-few new players growing to assert their dominance—as Amazon did for retail, and Tesla for automobiles. Looking ahead, we think similar trends could emerge in highly concentrated industries like healthcare, financial services, and telecommunications that are seeing new entrants and are ripe for tech disruption.

Artificial Intelligence

The pace of growth in artificial intelligence applications in 2021, accelerated by COVID, suggests increased adoption in areas like cybersecurity, workflow management, sales and customer support. This could lead to more M&A activity and funding in 2021—though there is reason for caution. For such investments to pay off, many companies will need to act aggressively to adapt their talent strategies, organisational structures, business strategies, development methodologies and risk mitigation for a world that moves at AI speed.

Key themes behind current M&A activity

Industry boundaries everywhere are converging with tech

Traditional industry boundaries are converging as technology becomes front and centre across every industry, creating opportunities for M&A. New entrants and tech disruptions are redefining business models and changing the way we live our lives, as we’ve seen with the emergence of industries like HealthTech, FinTech, and CleanTech. In addition to seeing industry boundaries converge, we are also seeing the convergence of multiple technologies. 

The auto industry, once reserved for large national brands, is seeing companies emerge across the globe that interweave new technology with old offerings (Tesla/Lucid Motors/Nio). Similar disruption has been seen in other areas: retail (Amazon/Alibaba), fitness (Peloton/Mirror), payments (Stripe/Square), financial services (Robinhood/SoFi). These are not the last innovators, and in 2021 we expect to see several more tech-focused companies emerge and disrupt other sectors. We believe this will likely lead to further deal-making, led by large corporations seeking to acquire or enhance existing capabilities and transform their own businesses.

Significant investment is needed by telecom companies in infrastructure and 5G technology

In the telecom sector, some companies are exiting their non-traditional investments (e.g., media) and consolidating their portfolios to free up cash for investment in 5G. For example, in the US, Verizon and AT&T divested parts of their non-core businesses last year; and in 2021, Canada’s and Spain’s large telecom companies are merging for scale to prepare for high-intensity competition.

We don’t expect the deal-making to end soon, as the telecom industry is poised to utilise its increased cash flows and scale to increase investments in its core businesses. Telecom companies may invest in infrastructure (towers, data centres, fibre, etc.) or build out 5G through acquisitions. Each may pursue its own respective strategy, but we can expect an increased focus on verticalisation as companies build out their infrastructure and technology.

Record capital supply and investments triggered by SPACs, IPOs and VC funding

  • SPAC boom: The 2020 surge in SPAC IPOs continued into 2021, with a record 274 new SPACs listed in the first quarter. SPACs raised more than US$80bn during the first half of 2021, more than the amount raised during the whole of 2020. While increased scrutiny by the SEC temporarily muted SPAC capital-raising activity in the second quarter of 2021, we are seeing a number of ways that SPACs will impact M&A over the next several months. On the divestiture side, in addition to public spins or divesting to private equity (PE), we are seeing more divestitures-to-SPAC transactions. Additionally, levels of interest are on the rise among international companies looking to use the SPACs as a route to a US listing, rather than the traditional foreign filer process. We believe SPACs will continue to impact M&A, particularly in the TMT sector, as those recently listed SPACs seek to identify suitable acquisition targets and complete a merger over the next 12 to 18 months.
  • Re-energized IPO market: The IPO market has returned to pre-pandemic levels, as so-called unicorn companies reschedule public offerings delayed during the pandemic. Over the past few months, IPOs such as DoorDash, Palantir, XPeng, Snowflake and DiDi all show investor enthusiasm for high-growth offerings.
  • Increase in venture capital: Global TMT VC deal-making is off to a strong start in 2021, indicating the market’s willingness to invest in the sector and signalling opportunities for the next round of unicorns and disruptors. By the end of March 2021, global VC deal-making already approached 40% of total funding for all 2020 and appears on track to outpace the previous year total. Given the high rate of investment, we'll look for VC exit strategies to result in potential M&A deals in years to come. 

Technology, Media & Telecommunications M&A outlook

We are optimistic about the potential for M&A value creation that lies ahead for 2021 and beyond. Huge opportunities from digitisation and new industry disruptions, along with record levels of capital and investments triggered by IPOs and SPACs, have established a foundation for continued robust M&A activity this year.

To compete in a growing, fast-paced environment, companies will need to be bold and adopt a value creation mindset to M&A strategy to best position for an ever-changing future.

About the data
We have based our commentary on M&A trends on data provided by industry-recognised sources. Specifically, values and volumes referenced in this publication are based on officially announced transactions, excluding rumoured and withdrawn transactions, as provided by Refinitiv as of 30 June 2021 and as accessed on 5 July 2021. This has been supplemented by additional information from Dealogic and our independent research. This document includes data derived from data provided under license by Dealogic. Dealogic retains and reserves all rights in such licensed data. Certain adjustments have been made to the source information to align with PwC’s industry mapping. We define megadeals as transactions with a deal value greater than US$5 billion. In addition, certain data on crypto M&A has been based on data extracted from MergerMarket, Capital IQ, Crunchbase, Pitchbook, Coindesk and CoinTelegraph for the period 1 January 2020 to 31 December 2020.

Contact us

Marc Suidan

Marc Suidan

Global Technology, Media & Telecommunications Deals Leader, PwC United States

Brian  Levy

Brian Levy

Global Deals Industries Leader, PwC United States

Alvin Bao

Alvin Bao

China Technology, Media & Telecommunications Deals Leader, PwC China

Nick George

Nick George

UK Technology, Media & Telecommunications Deals leader, PwC United Kingdom

Jens Weber

Jens Weber

Germany Technology, Media & Telecommunications Deals Leader, PwC Germany