Technological enhancements
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It is a quiet time in the IT sector acquisitions market, allowing some of the more esoteric technology acquisitions to come to the fore
The first thing that leaps out from the list of IT sector acquisitions in February 2009 is the absence of sizeable price tags.
Despite the fact that IT vendors still have bundles of cash, and that deflated stock prices mean there are plenty of bargains to be had, the giants of the sector are keeping relatively quiet on the acquisition front, with lots of cherry-picking deals but few major transactions.
Perhaps they are waiting for prices to come down further; or they are wary of buying into businesses whose future is even less certain than their own.
Either way, the acquisitions that did occur have been about adding technology to the acquirer’s portfolio, rather than building market share. It was therefore an opportunity to take note of some rather more esoteric technology deals.
For example, network equipment manufacturer Cisco acquired an obscure vendor, Richards-Zeta Building Intelligence, whose technology allows businesses to integrate their building infrastructure with their IT infrastructure over the Internet protocol. This allows them to monitor and manage the power and heat consumption of their building on their existing IT systems.
Richards-Zeta’s technology has been deployed in places such as the Los Angeles International Airport control tower and the Energizer battery manufacturing plant in North Carolina.
The acquisition will allow Cisco to “deliver complete solutions designed to maximise operational and energy efficiencies and provide cost and carbon savings for customers,” says Marthin De Beer, senior vice president of Cisco’s Emerging Technologies Group.
Equally futuristic was the acquisition of software code search engine provider Krugle by software development outsourcing provider Aragon, which is headquartered in the US but whose development centre is in China.
“Traditional outsourcing is broken,” said Nagi Prabhu, CEO of Aragon. “It is plagued by poor visibility, unpredictable quality, steep learning curves and frequent cultural and communication breakdowns.”
The company claims that its high-tech approach to software development helps it provide a better service than traditional outsourcing providers. Krugle’s technology, which it originally developed for an online open source software search engine, can search and detect faults in code as it is written.
