Today: 22 June 2025
9 May 2023
2 mins read

Global tech services sector hits $57 bn in deal activity

Even as assets in areas such as Cloud, data and AI, cybersecurity and digital product engineering still command a relative premium, we do expect to see an uptick on the demand side of deals…reports Asian Lite News

Despite a continuing slowdown, the global technology service sector witnessed a surge in M&A and private equity deals in 2022, reaching a total of $57 billion, more than double the amount seen in 2020 (over $27 billion), a report showed on Monday.

The technology service sector including IT Services, BPM, and ER&D saw an uptick in transaction activity, with a total of 947 deals — the highest number recorded in the past five years, according to a report by EY and Nasscom.

Private Equity (PE) deals placed several large bets — 15 out of 23 large (over $500 million) deals in 2022.

Notably, BPM and ER&D services experienced growth of 1.5x and 1.8x, respectively compared to 2020, the report noted.

“While the first quarter saw a slowdown in deal activity, both strategic purchasers and private equity firms continue to hunt for enhancing their digital and domain capabilities, expanding geographic reach, and filling white spaces in their portfolios,” said Nitin Bhatt, Technology Sector Leader, EY India.

Even as assets in areas such as Cloud, data and AI, cybersecurity and digital product engineering still command a relative premium, we do expect to see an uptick on the demand side of deals.

“The real question is how sellers should strategize their exit in this market,” Bhatt added.

As the current environment evolves, the focus on spending priorities and the nature of vendor partnerships are likely to shift.

Enterprise buyers will probably reevaluate their digital spending priorities, emphasizing cost optimization and seeking providers who can deliver transformation through outcome-based models, the findings showed.

“The last 24 months have witnessed a significant shift in enterprise investments towards digital and business transformation. Technologies such as AR, VR, IoT, and edge intelligence, are now finding applications in manufacturing, automotive, and supply chain,” said Sangeeta Gupta, Senior Vice President and Chief Strategy Officer, Nasscom.

With greater emphasis on emerging digital capabilities, the market is likely to become more cautious and adopt creative deal structures to manage risk.

Although deal activity has softened, with over 150 deals announced in Q1 CY23 compared to more than 270 in Q1 CY22 and over 220 in Q1 CY21, deal activity for mid-sized companies is expected to remain strong across the broader M&A market, the report said.

ALSO READ-WhatsApp rolling out ‘side-by-side’ feature on Android tablets

Previous Story

New Android malware discovered that steals passwords

Next Story

Indian warships complete drill in South China Sea

Latest from -Top News

US committed great crime: Iran

Iran has now called for an emergency meeting of the UN Security Council and demanded the IAEA Board of Governors address the situation….reports Asian Lite News Iran has strongly condemned the United

Strike Iran, Face Us, Houthis warn US

The Yemen-based Houthi group, which controls much of northern Yemen, has been targeting Israel since November 2023…reports Asian Lite News Yemen’s Houthi group issued a stark warning on Sunday, declaring they would

Tehran Hits Back After US Strikes

The missiles struck several locations across central Israel. Notably, one hit Haifa without any prior warning sirens, raising alarm over possible gaps in the missile alert system….reports Asian Lite News Iran fired

Trump Dares Iran Again

This comes as Trump announced that America had bombed three nuclear sites in Iran and warned Tehran of further precision strikes…reports Asian Lite News US President Donald Trump declared that no other
Go toTop

Don't Miss

Tech giants add $2.4 tn due to AI this year

In Europe and Israel, 40 per cent of new unicorns

Global Tech Giants Flock to India for Manufacturing

Apple has been assembling iPhones in India, a strategy that