Massive Number of Takeovers Due To Tech Giant Competition. In the month of November alone there has been a staggering amount of corporate deals made, with it reaching the $200 billion mark.
A lot of retail vendors are worried and looking to investment bankers in order to identify potential takeover partners as they continue to fight off competition from behemoths such as Amazon. The traditional retail model is slowly being bypassed by online stores with Amazon sucking up everything around them.
It is not just the retail industry that is having these concerns, areas such as healthcare and the media are just two of many industries which are also being dramatically affected by these large corporations.
The largest companies such as Amazon, Facebook, Google and Netflix all have many competitive advantages due to their size and large amounts of cash that they have stockpiled. They will often swallow up competitors by either acquiring them or squashing them using their superior size and cash piles.
This is why there has been so many mergers and acquisitions seen this month, with over $200 billion worth of deals being announced in the United States during just the month of November. This means that the month is set to be the second largest month for deals of this nature since they were first tracked back in 1995.
There are three deals in particular that are currently under review that showcase how dramatically Amazon can have an influence over their competitors.
CVS Health Corporation is close to agreeing a merger with Aetna Inc. before the end of the month for a deal worth more than $66 billion. This will see the two companies untie and have little to no overlap in terms of operations.
This comes after there have been a lot of murmurs regarding Amazon and their potential entry into the pharmacy industry. This is why the executives at CVS have decided to try and get involved with a health insurer which will allow them to bolster their place in the industry. This means that in the drugstores, CVS would have the ability to sell insurance, as well as draw blood and the likes, something that Amazon would find it hard to copy.
There also has been a lot of talk about AT&T planning to buy Time Warner in a deal that will be worth around $85 billion and would see a major mobile phone business teaming up with a satellite television operator with Time Warner having the likes of HBO and CNN under their umbrella.
This looks to be a move to safeguard themselves from the likes of Facebook and Google who are firm stalwarts when it comes to the advertising markets.
Walt Disney has been showing their interest in a large amount of 21st Century Fox’s assets as of late which has been accelerated due to the massive success of Netflix. They are set to launch their own online subscription service for streaming in the near future in what is a move to try and win back customers that are going over to Netflix.
It is going to be an interesting space to watch as the fight against the behemoth organizations begins.
