Bolstered by AT&T’s (NYSE:T) massive bid for T-Mobile USA, technology acquirers set a new post-recession spending high in the first quarter of 2011, shelling out $84bn to acquire 881 companies. This announced spending level is one-third more than the previous post-downturn high-water mark of $62bn set in Q2 2010, and the highest level of M&A spending since Q2 2008, according to the 451 M&A KnowledgeBase, a technology-focused M&A transaction database provided by leading industry analyst and data firm The 451 Group.

The quarter’s game-changing deal came in late March with AT&T’s proposed $39bn purchase of T-Mobile USA from Deutsche Telekom (NYSE:DT), the largest technology-related transaction in a half-decade.

Even without that landmark telecom deal, however, Q1 deal flow was on track to exceed the preceding quarter, despite global turmoil that included the tragic tsunami in Japan and ongoing revolutions in the Middle East. March was especially active, with big-ticket acquirers other than AT&T driving deal flow to its highest levels since last summer. Those buyers announced nine deals valued at $1bn or more in March alone, compared to just six billion-dollar-plus transactions for January and February combined.

Among the other notable transactions of the quarter:

• Western Digital’s (NYSE: WDC) $4.3bn cash-and-stock purchase of Hitachi Global Storage Technologies, the largest storage deal in some seven years.
• Qualcomm’s (Nasdaq: QCOM) $3.6bn pickup of Atheros Communications (Nasdaq: ATHR), the largest-ever acquisition by Qualcomm.
• In its largest deal in a half-decade, eBay (Nasdaq: EBAY) said it would pay $2.4bn in cash for GSI Commerce (Nasdaq: GSIC).
• Charles Schwab (NYSE: SCH) bid $1bn for optionsXpress Holdings, its largest deal in a decade.
• Infor Global Solutions’ unsolicited $1.8bn bid for Lawson Software (Nasdaq: LWSN), a sizeable bet on consolidating the mature ERP market by Infor’s recently appointed CEO, Chuck Phillips.
• salesforce.com (NYSE: CRM) announced the largest deal in its history, the $326m acquisition of privately held Radian6.
• VC-backed companies saw a burst of activity as acquirers bought 177 venture-backed companies, almost as many as in Q1 2010 and Q1 2009 combined.

Despite these record-setting totals, a number of tech giants – including Microsoft (Nasdaq: MSFT), Symantec (Nasdaq: SYMC), EMC (NYSE: EMC), Nokia (NYSE: NOK) and even typically highly active Oracle (Nasdaq: ORCL) – sat out the first quarter, announcing no deals at all.

Note: The 451 Group’s tech M&A spending totals are based on announced transactions, and include both officially announced deal values and The 451 Group’s proprietary deal-value estimates for key transactions. For additional information on The 451 Group and the 451 M&A KnowledgeBase, go to: www.the451group.com.

About The 451 Group

The 451 Group is a leading technology-industry analyst company focused on the business of enterprise IT innovation. The company's analysts provide critical and timely insight into the market and competitive dynamics of innovation in emerging technology segments. Clients of the company – at vendor, investor, service-provider and end-user organizations – rely on The 451 Group's insight to support both strategic and tactical decision-making. The 451 Group is headquartered in New York, with offices in key locations, including San Francisco, Washington, DC, London, Boston, Seattle and Denver.