In the first quarter of 2012, 248 middle market transactions were closed worldwide in the Information Technology (“IT”) industry. Transactions valued at less than $100 million represented approximately 80% of these deals.

One reason for a large percentage of the deals occurring in the lower middle-market is industry consolidation, and the need for companies to stay competitive. In February, Juniper Networks purchased Mykonos Software for $80 million to enhance its security offerings and stay competitive with companies such as Palo Alto Networks.

Another reason is because larger companies are eager to expand into related markets, and they are doing this by acquiring small, well-established companies. In January, AT&T purchased SuperClick for approximately $15 million to grow its presence in the hotel Wifi market. As this space becomes increasingly popular, AT&T looked to acquire a company with robust technology and many well-known clients. Superclick’s clients include Four Seasons Hotels, Jumeirah, and Marriott Hotels International, among many others.

These trends are prevalent not only in IT, but also across most other industries. Furthermore, with the continued acceleration of the U.S. GDP at the end of 2011, along with the optimistic economic data, we expect the number of middle market transactions to continue to increase in 2012.

Over the past three years, the emergence of the South American economy has not been a surprise to many. While Brazil may be the first country that comes to mind when one mentions a strong South American economy, other countries such as Argentina, Uruguay, and Colombia will start to make more headlines over the next two to three years. After all, their respective GDP growth rates on a year-over-year basis are the three highest in South America at 9.30%, 8.47%, and 7.7%.

From an M&A standpoint, in these countries combined, there were 42 more deals announced or closed in 2011 than there were in 2010. The associated transaction values jumped by $3.6 billion. In terms of the increase in number of transactions and the aggregate increase in transaction value, both increased by 22% from 2010 to 2011. Furthermore, almost 60% of all deals occurred in one of the four following sectors: Energy, Financials, Materials, and Industrials.

With strong macroeconomic factors, we expect M&A in these and other South American countries to continue the upward trend in 2012. Additionally, as more and more companies worldwide begin to see the tremendous growth opportunities that these countries present, the number of transactions should continue to increase every year.