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Introduction

Mergers and acquisitions continue to reshape the communications provider sector. In 3Q16, 67 deals were announced (or closed), worth just under $79bn. That is up from 37 deals in 3Q15, totaling $12bn. Cable TV deals have been important in 2016, but nontraditional mergers are rising.

Highlights

  • In the last year (4Q15-3Q16), the communications provider (CP) M&A deal total was 239 with a value of $332bn. That is up from 156 deals valued at $140bn in the prior year period. In terms of number of deals, M&A activity is at a 10-year high. Deal value is about the same as in 2Q14.
  • From the outset of our database in 2006, roughly 40% of all deals were valued at $100m or less. At the other extreme, just 2.7% of all deals were over $10bn in value.
  • Cable has dominated the M&A market lately, coming in at over 40% of total market value over the last 12 months. Industry crossover deals have become significant too, representing a bit over 35% of deal value through 3Q16.

Features and Benefits

  • Evaluates the market for communications services M&A deals in light of recent results.
  • Analyzes the drivers behind different types of deals.
  • Assesses the outlook for future industry M&A.

Key questions answered

  • How has communications sector M&A activity fluctuated in the last decade? What has driven the recent spike?
  • Who are the key dealmakers in the industry?
  • What are the most significant deals in each of the past few years?
  • How will M&A help to reshape the industry landscape?

Table of contents

Summary

  • In brief
  • Ovum view

M&A activity strong in telecom as simple scale deals fade away to industry crossovers

  • Softbank-ARM, Verizon-Yahoo, Microsoft-LinkedIn, and China's tower JV the most important deals of 2016 to date

M&A is reshaping the telecom industry

  • Lines between three main CP segments already blurring
  • Nontraditional deal activity growing in size and importance

Appendix

  • Methodology
  • Further reading
  • Author

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