More numbers on 2016 tech M&A, foreign cash hoards

A bit of a jumbled article for general audiences
, but some more numbers of tech companies’ cash on hand and numbers around 2016 acquisitions:

The value of software deals in 2016 topped $115 billion for acquisitions closed or pending, according to data gathered by Bloomberg. That’s up about 19 percent from 2015.

But:

Overall in 2016, the value of merger-and-acquisition business software deals totaled $117.6 billion.

And:

That doesn’t include the blockbuster tech deal of the year: Microsoft paying $26 billion for LinkedIn. LinkedIn does not fit neatly into the category of business software because of its professional networking tools that are used by workers outside of business hours.

Tech companies have lots of cash abroad. If the Trump folks reduce the tax down to 10%, the theory is many companies would bring that cash “back home” and could use it to buy things, and likely pay our dividends and do share buy backs:

Oracle and Microsoft have more than 80 percent of their cash, near-term cash and short-term investments in foreign subsidiaries, according to recent filings.

Who knows? It’s all a bit of a lamp-post analysis, but, sure: ¯_(ツ)_/¯

Source: Companies Anticipate Big Software Deals, With Help From Trump

Cash repatriation could inject $850bn, post-tax

If Congress enacted such a deal, of course, only a fraction of the $2.6 trillion would reach shareholders. It’s important to note that much of the UFE is not actually in cash; it’s invested in overseas plants or provides working capital for foreign subsidiaries. At press time, specifics of a plan hadn’t emerged, and figuring out which assets will ultimately get taxed, and at what rate, will be thorny. But based on Trump’s earlier proposal and on past holidays, investing pros estimate that about 40% of the UFE, or around $1 trillion, will come back to the U.S.—and that companies would net at least $850 billion after taxes.

Tech and health care companies would get most of that.


I think most people believe that cash would be used in stock buybacks and dividend to raise share prices and give cash to investors. Trump would probably want it for creating new jobs, and it could be used for domestic acquisitions.

See the rest from Shawn Tully at Fortune.