M&As in Procurement Technology Work Jason Busch - June 26, 2015 6:21 AM | Categories: Analysis, M&A, Procurement Commentary, Technology | Tags: Technology A recent post by Michael Lamoureux, M&A: Confusion or Clarity, got me thinking about the role mergers and acquisitions are playing in shaping the procurement technology landscape today. As I see it, the recent deal activity can help a number of organizations realize the often elusive acquisition synergy goal of having 1+1 = 3. But Michael, as may be clear from the title of his post, argues that M&A in procurement technology brings more sizzle than steak, especially from both a solution and customer perspective and a translation to financial returns. Here’s the broader question: How can 2 good minds (I hope!) examine the same topic and arrive at 2 very different opinions? I take a more optimistic lens. For reasons both planned and unplanned, M&A within the procurement sector has brought more positives than negatives, at least with many bigger name firms. In a recent Spend Matters PRO post on the topic, Making the Case for M&A With Procurement Technology Firms: A Case-Based Analysis, I use 3 case studies – Xchanging/MarketMaker4, SAP/Ariba and Sciquest – to explore different benefits that transactions can bring for acquiring parties outside the usual plug and chug accretion-dilution model synergies. Having spent much of my career focused on strategy and corporate development work and analysis within the procurement and supply chain solution areas, I believe this area of the technology market likely outperforms others from a deal synergy perspective for a variety of reasons: The overall complexity of the solution landscape and functional areas compared with other business application and technology solution areas The relative youth of this area compared with others and the need for bringing together the right sets of talent at the right time A constant march toward suite approaches and integrated solutions in recent years Capital markets, as well as private equity money, that have favored acquisitions and combinations Overall CAGRs for different solution areas that support the cost and risk of doing deals As for the individual reasons and benefits for doing deals, I encourage you to read the case examples in the above-linked analysis. Discuss this: Cancel reply Your email address will not be published. Required fields are marked *Comment Name * Email * Website Notify me of follow-up comments by email. Notify me of new posts by email.