Study: VC-backed mergers, IPOs slowing

In the first quarter of 2008, a study says there were 56 venture-backed deals, 41 deals of which were related to information technology.

The number of venture-backed mergers and acquisitions in the first three months of 2008 hit an all-time quarterly low for the decade, according to a new report from Thomson Financial and the National Venture Capital Association. Internet-related deals dominated the pack.

In the first quarter of 2008, the association reported that there were 56 venture-backed deals, 41 deals of which were related to information technology. (The biggest deal was Dell's $1.4 billion buyout of EqualLogic, a provider of storage area network solutions.) Those 41 mergers or acquisitions had a disclosed dollar value of about $2 billion total, according to the study; and Internet-related deals accounted for about $1.7 billion of that.

The average disclosed deal value for the quarter was $124.6 million, the study said.

The NVCA also reported that VC-backed IPOs in the first quarter of 2008 dropped to lows from 2003. It estimated that there were only five VC-backed public offerings for a total of $282.7 million in the first quarter, compared with two IPOs reported in the second quarter of 2003.

"U.S. economic uncertainty clearly impacted the venture-backed IPO market in the first quarter," NVCA President Mark Heesen said in a statement.

He added: "While the acquisitions market is also showing lower volumes, the quality of exits--both IPO's and acquisitions--appears to be holding up, which should translate into some much needed confidence for venture backed companies looking to exit in 2008."

 

Join the discussion

Conversation powered by Livefyre

Don't Miss
Hot Products
Trending on CNET

HOT ON CNET

Last minute back to school shopping?

Whether you're looking for headphones to study with or music-streaming gear, CNET rounds up a shopping guide just for you.