Value Added Resellers in Information Technology: Trends in Acquisitions

The information technology (IT) hardware and software distribution industry has experienced a shift towards centralized services and lightweight applications over the past decade. In response, resellers of hardware and software are expanding their offerings into managed services through acquisitions. As a result, large firms are competing to build portfolios of services that meet their client’s needs for fully integrated IT systems. This report examines trends in acquisitions amongst software and hardware distributors and identifies factors that influence acquisitions of firms within the reselling industry. The purpose of this analysis is to develop a background that will allow an acquirer to begin to generate an assessment of the value of a firm. The analysis component of this report describes a set of acquisitions over the past four years by market vertical, product portfolio, market share, and geography. Following that, a summary of trends in market forces is presented to provide an idea for what to expect moving forward if current market conditions persist. Lastly, a set of criteria is presented to aid acquirers in evaluating potential targets for acquisition.