Who Are the 5 Biggest IT & Business Services Dealmakers?

Is global financial volatility causing company CIOs to tighten their belts when it comes to spending on IT & business services? Quite the opposite. According to a recent forecast by Gartner, worldwide IT spending is set to reach $4.5 trillion this year, a more than 5% increase from last year. 

In the emphatic words of Gartner research vice president John-David Lovelock, ‘2022 is the year that the future returns for the CIO’ following the turbulence of the pandemic period. As Lovelock has put  it, ‘Staff skills gaps, wage inflation and the war for talent will push CIOs to rely more on consultancies and managed service firms to pursue their digital strategies.’

In other words, the economic and geopolitical pressures of the current year are actually benefitting tech firms specialising in IT & business services solutions. For example, as our newest M&A market report on the sector has revealed, cloud spending is expected to show just over 22% growth compared to last year, reflecting the need for many companies to met increased IT demand in the face of dwindling numbers of skilled IT staff. 

The knock-on effect of this demand is ever-increasing M&A activity involving IT & business services companies. Indeed, our new report has shown that the first half of 2022 saw record deal volume in the sector: a whopping 31% increase from the latter half of last year. 

It’s well worth downloading the whole report if you work in IT & business services, as it delves into exactly what kinds of companies are getting the most attention. The report also points out the most prolific buyers in this space: the major players whose deals have helped shape the industry over the past 30 months. Let’s take a quick look at the five biggest dealmakers on the list.

Headquartered just outside Paris, Atos is an IT giant which provides cloud, cybersecurity, and other digital services for a wide range of industries. It’s also been the fourth most prolific acquirer in IT & business services, with 10 acquisitions since 2019. Among its significant purchases is AppCentrica, a Toronto-based cloud services company which helps clients modernise their aging technology systems and optimise their use of Salesforce. 

Atos has also snapped up London-based cloud services company Cloudreach. Hailed as ‘visionary’ by Gartner, Cloudreach provides dynamic solutions like complete Amazon Web Services cloud migration in 50 days. Atos has described the acquisition as a key phase in its growth as the ‘multi-cloud powerhouse’, especially when it comes to AWS services.

While it’s a Big Four accounting firm with roots going right back to the first half of the 19th century, Deloitte isn’t resting on its laurels as one of the world’s most well-established companies. With 14 acquisitions under its belt, Deloitte has been aggressively expanding its reach in the IT & business services space, and a key target has been Intellify, a Sydney-based company that only came into existence in 2018. 

Intellify provides AI-powered data engineering and analytics services to clients in spaces like banking, insurance and retail. Named AWS Partner of the Year in machine learning in 2022, Intellify’s geographical location and expertise in AI made it a natural target for Deloitte, which launched a dedicated AI research institute in Australia last year.

Two companies have made 15 IT & business services acquisitions since 2019. One is Converge, a cloud solutions, analytics and cybersecurity multinational headquartered in Quebec. Its desire to grow its cybersecurity presence was one of the reasons behind its acquisition of Creative Breakthroughs (CBI). Based in Ferndale, Michigan, CBI’s tools help clients identify system vulnerabilities and minimise the risk of cyber attacks.

Another recent acquisition for Converge was Interdynamix Systems (IDX). Based in Edmonton, Alberta, IDX provides a range of solutions, from cloud migration to 24/7 infrastructure monitoring and management. This purchase has helped consolidate Converge’s position as one of the leading IT services suppliers in Canada. 

The other company that made 15 purchases in this time period is IT behemoth Cognizant, which already provides AI, digital strategy and cloud solutions services to banks, pharma giants, energy companies, and numerous other players in a variety of verticals. The Teaneck, New Jersey company still has an insatiable appetite for growth, however, with one key deal targeting Devbridge – a product design consultancy based in Chicago. 

This is an example of an acquisition motivated by the desire to take on a skilled workforce at a stroke. It’s provided Cognizant with more than 600 new engineers and designers based in both Europe and North America, allowing the multinational to provide fully customised and bespoke software solutions for its clients.

Dublin-based professional services colossus Accenture has been the biggest buyer in IT & business services by far. While the next-most-prolific dealmakers, Cognizant and Converge, made 15 transactions each, Accenture has surged ahead with 81 acquisitions in this time period. 

Among the many targets was Advocate, a provider of technology management solutions based in Norcross, Georgia. Advocate has explicitly positioned itself as a go-to for CIOs looking to optimise their IT infrastructures with limited resources. The company’s rhetorical question, ‘Why reinvent the wheel by hiring and training your own people for technology business management?’, has particular resonance in a time when businesses are dealing with financial headwinds and recruitment challenges.

Accenture has also recently acquired XtremeEDA, an Ottawa-based provider of semiconductor engineering services for clients requiring custom silicon solutions for cloud data centres and AI platforms. This was part of a recent acquisition spree by Accenture with the intention of bolstering its Cloud First division. Purchasing companies like XtremeEDA has brought more engineers into the Cloud First team, expanding Accenture’s capabilities in edge computing and product design.