December 26, 2024 – Internet of Things (IoT) software and technology services market for mergers and acquisitions in 2024 has shown resilience and growth despite broader economic uncertainties. The global enterprise IoT market revenue rose to USD $600.8 billion in 2023 and is projected to reach USD $671.4 billion in 2024, demonstrating a steady upward trajectory. 

As companies increase digital and AI transformation, the IoT market continues to evolve, M&A activity is expected to remain a critical strategy for companies looking to enhance their capabilities, expand market reach, and achieve synergies in an increasingly competitive digital landscape.

Technology-driven acquisitions

Companies are increasingly focused on acquiring new technologies and digital capabilities to expand their market presence and stay competitive in the IoT space. This includes technologies such as cloud computing, cybersecurity, data analytics, and artificial intelligence/machine learning (AI/ML)13. The rise of generative AI in particular has put digital transformation at the forefront for many executives and investors, driving deals to acquire cutting-edge AI capabilities.

Vertical SaaS solutions

There is growing demand for vertical-specific software-as-a-service (SaaS) solutions in the IoT market. This is prompting both established companies and private equity firms to acquire specialized IoT software providers that cater to specific industries.

Consolidation for end-to-end platforms

Many providers are pursuing M&A to build out comprehensive, end-to-end IoT platforms. For example, cybersecurity companies are acquiring complementary technologies to offer more complete security operations platforms for IoT environments.

Focus on operational resilience

With increasing connectivity and data volumes in IoT deployments, there is heightened focus on acquiring capabilities that enhance operational resilience, including technologies for supply chain management, cybersecurity, and data management.

Cross-border transactions

Despite geopolitical tensions, cross-border M&A remains important for IoT software companies looking to expand their global reach and capabilities. However, this requires careful navigation of cultural differences and regulatory environments.

While economic headwinds persist, these technology-driven trends are expected to fuel continued M&A activity in the IoT software market through the remainder of 2024 and 2025, particularly for strategic, capability-focused acquisitions that can drive digital transformation and innovation.

The IoT sector has seen a fair amount of M&A activity in the past six months.

Here’s a summary of some notable deals:

Acquisitions

• Scenera acquires TnM AI Co. Ltd: Scenera, a US-based provider of AI-powered video analytics, acquired TnM AI, a South Korean AIoT company specializing in AI technology for smart cities and factories. This move aims to strengthen Scenera’s AI capabilities and expand its presence in Asia.
• Rev.io acquires Tigerpaw: Rev.io, a telecom management solutions provider, acquired Tigerpaw, a company offering professional services automation software. This acquisition will allow Rev.io to expand its offerings and provide end-to-end solutions for technology providers.
• Honeywell acquires SCADAfence: Honeywell, a major player in industrial automation and security, acquired SCADAfence, a cybersecurity software provider focusing on Operational Technology (OT) and Internet of Things (IoT) environments. This acquisition enhances Honeywell’s cybersecurity portfolio, particularly in industrial settings.
• Wireless Logic acquires Blue Wireless: Wireless Logic, a global IoT connectivity platform provider, acquired Blue Wireless, a Singapore-based provider of managed wireless solutions. This acquisition expands Wireless Logic’s global reach and strengthens its capabilities in the Asia-Pacific region.
• Signify acquires Intelligent Lighting Controls: Signify, a leading lighting company, acquired Intelligent Lighting Controls (ILC), a US-based manufacturer of wired control systems. This acquisition expands Signify’s connected lighting portfolio and strengthens its position in the smart building market.
• GlobalFoundries acquires Renesas’ CBRAM technology: GlobalFoundries, a semiconductor manufacturer, acquired Renesas’ CBRAM (Conductive Bridging RAM) technology. This acquisition will enable GlobalFoundries to offer advanced memory solutions for IoT and 5G applications.

Funding Rounds

• Soracom, a provider of IoT connectivity solutions, raised $120 million in Series D funding. The investment will support Soracom’s expansion efforts, including the development of new products and services to address the growing demand for secure and scalable IoT connectivity.
• Particle, a leading IoT platform provider, secured $40 million in Series C funding. The funding will fuel Particle’s product innovation and global expansion initiatives, enabling businesses to accelerate their IoT projects and drive digital transformation.

For more information on the IoT M&A sector, or to inquire about a transaction, please contact us.