The past week has offered a dynamic mixture of major exits and share-acquisitions, continuing a 2014 trend of multi-billion-dollar deals almost on a weekly basis. The biggest headliner of the past seven days was Apple’s surprising acquisition of Beats, the electronics music developer, suggesting the company is joining the global arms race being undertaken by the digital majors. Tencent continued its weekly rivalry with Alibaba by purchasing a stake in navigational tool NavInfo, just a few weeks after Alibaba bought navigational app AutoNavi.
Finally, in the less lucrative but the increasingly vibrant FinTech space, Bottomline Technologies purchased banking software firm Andera. In the same segment, we at Acuity secured the sale of YourWealth.co.uk and its Money Hub app technology, pending regulatory approval, to Momentum UK, which forms part of MMI Holdings Ltd (MMI), one of the largest financial services groups in South Africa.
Apple bets on urban cool
Acquisitions by the electronics giant Apple are rare and usually fairly low-key, with the company historically preferring to integrate software specialists into its core products range. It has been somewhat of a surprise therefore that the company has bought Beats, a headphone vendor with a strong marketing position among the under-30s segment, for a massive $3.2 billion. Beats is entirely its own brand, sporting black and red colours on its much-publicised headphones and driving an aggressive Hip-Hop-focused marketing campaign that has been built around performing artist Dr. Dre. Apple is unlikely to integrate such a product into its existing i-range, and most believe the firm is simply investing its cash-rich reserves into a product with proven appeal among a much-vaunted demographic. Nonetheless, smaller but more quality-focused headphone makers such as Sennheiser are likely to be wondering why Apple was not interested in financing a more fitting and cheaper exit in the segment.
Tencent enters nav-tool arena to face-off against Alibaba
The tit-for-tat acquisition strategy between Chinese digital giants Tencent and Alibaba has been a reoccurring theme over the past few years. There remain few segments where the two majors do not go head to head in the Chinese marketplace. Continuing this trend, Tencent acquired a 11.3% stake in digital mapping firm NavInfo, one of China’s biggest mapping companies, for $187 million. The deal comes on the back of Alibaba’s purchase of Chinese mapping company AutoNavi, which it has already integrated it into its own services. Tencent is likely to follow suit.
Bottomline buys FinTech provider Andera
Bottomline Technologies, which specialises in digital banking solutions for financial institutions, has bought banking software company Andera for $44.5 million. The acquisition is another sign of rapidly expanding activity in the FinTech space, which is increasingly becoming a major digital segment in its own right. Firms that are able to deliver financial solutions digitally are expected to play a major role in the overhaul of the global consumer- and business-facing finance sector. Andera helps banks and credit unions create new accounts and process online loans, having processed more than 4.5 million new account applications for over 500 banks and credit unions.
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