In 2024, over 6,600 tech M&A transactions were announced in the West, equally distributed in Europe and the USA, for a value of over 408 billion euros, up (+26.6%) compared to 322 billion in 2023. given that the number of operations remained stable in the USA and Europe, the growth in the size of US operations (+38.5% volumes) was driving the volumes. This is the balance sheet for 2024 in the Italian and European technology sector that emerges from theinsight report by Klecha & Co.an independent pan-European investment bank specializing in tech sectors.
The European scenario: Italy bucking the trend
In Europe the technology sector has confirmed the dynamism of 2023: 1 deal in 3 of the total European m&a (equal to 9,568) concerned the technological sector which recorded a total of approximately 3,230. This number is decreasing compared to last year (-8.5%), a dynamic that reflects the contraction of overall operations carried out in Europe in all sectors (-7.5%). Italy is going against the trend compared to Europe in terms of the number of M&A operations in the tech sector, which remained stable (-0.5%) at 210. Also particularly relevant in Italy is the growth in the number of megadeals, i.e. operations with a higher value to one billion euros, which went from 3 in 2023 to 12 in 2024, among which the acquisition of Vodafone Italy on the part of Fastweb for 8 billion euros and the acquisition of Tim Sparkle by Retelit for 700 million euros. Looking at the volumes, it emerges that in European tech, operations worth over 109 billion euros were completed in 2024, up 2.6% compared to 2023 and equal to approximately 1/5 of the volumes of European M&A operations (which overall are worth 545 billion euros, up 41.5% compared to 23). Italy, with 13 billion euros, contributes to approximately 1/10 of the overall volume of European tech deals in 2024. This value compares with the 23.8 billion in 2023 which however included a megadeal of exceptional size, namely Tim-Kkr which alone was worth 22 billion euros.
Acquisitions made by European tech companies are growing
With a value of 56 billion euros (+17.2%) the acquisitions made by European tech companies surpass those made by Private Equity. In 2024, 2,056 operations were carried out, bringing the average value of operations to around 141 million euros, up from 112 million in 2023. This was followed by acquisitions carried out by Private Equity (‘Pe’) for a value of 47 billion euros , down (-17.6%) compared to 2023. The EP achieved a total of 442 deals which brings the average value of operations to approximately 586 million euros from 964 million in 2023. In light of the increase in operations carried out by tech companies, it is clear that a process of European consolidation is underway, also driven by companies owned by private equity. These have, in fact, closed deals for 7 billion euros, highlighting an impressive growth in volumes (+231% compared to 2 billion in 2023). 732 operations were carried out, bringing the average value of operations to around 170 million euros, a sharp increase from 100 million in 2023. Italy also highlights an ongoing consolidation among tech companies which closed over 150 operations in 2024 of m&a (-3.8% compared to 23). Private Equity follows with 31 transactions, a marked increase (+47.6%) compared to 2023, despite a limited growth of 10.4% of the total transactions carried out by these players in Italy (149 in all sectors). THE’increase in the incidence of tech out of the total transactions carried out, confirms the growing attractiveness of the country’s technology sector for these investors. Finally, companies participated by Private Equity closed 29 deals, down (-14.7%) compared to 2023. In Europe, the sector that attracted the most capital was Software: in this area, the main megadeal, from 4 .3 billion pounds, was that of Thoma Bravo Lp which acquired Darktrace Plc, a company active in the development and sale of cybersecurity technologies, an increasingly strategic sector. This is followed by services for b2c where the Eqt Ab deal stands out, acquiring Keywords Studios Plc (services for the video game industry) for a consideration of 2.4 billion euros. Closing the podium is the IT Services sector where Tpg Growth LLC and Gic Special Investments Pte Ltd signed an agreement to acquire Techem GmbH (digital solutions for construction) for 6.7 billion euros.
The prospects for 2025
In 2025 Klecha & Co. estimates that the impact of Italian tech on the total European operations could further grow, not only in terms of number, but also in volume. In fact, it is believed that the trend already underway in 2024 may continue, which has seen the number of megadeals quadruple and the average size of individual transactions grow. These could also be driven by Private Equity, increasingly active in Italy, which will benefit, also at a European level as well as in the USA, from an expected constantly decreasing cost of debt. More generally, two trends are identified at a European level. On the one hand, an acceleration of the consolidation process, after years of constant development, of the players offering software solutions and technological services to companies. On the other hand, we will witness a growing acquisition activity of technology companies by companies in sectors other than tech (“Corporate”), which will aim to internalize the solutions and technologies necessary for the digitalization of their processes and services.
The tech – he underlines Stephane Klecha, Co founder and managing partner of Klecha & Co– “confirms its dynamism at a global level and Italy, in addition to being against the trend compared to Europe in terms of number of transactions, sees a significant increase in megadeals and the growing interest of private equity. I am sure that the contribution of new capital will allow the country’s excellence to play as protagonists in the strategic game of European consolidation which must accelerate if we want to be competitive in the new global system. Looking to 2025, I expect that Italian tech will continue to increasingly attract not only finance, but also companies that decide to acquire technologies useful for the development and digitalization of their business. We have entered a new era of M&A: if for years we have witnessed investment and consolidation operations in tech, today it is instead functional, in a transversal way, to the development of all sectors. And there are all the conditions for an exceptional year for Italian tech.”
