Savvy deal makers form strategic partnerships, make aggressive bets on future technologies and acquire companies that go beyond taking out a competitor, but help them get to where they want to be next.
The five companies on our shortlist for 2015's best deal maker meet all of the above criteria. Most were involved in M&A, purchasing companies to strengthen their existing business to grow into new lines of businesses and geographies and to remain competitive for years to come. One finalist on our list was able to achieve its goals through a surprising partnership instead.
You can check out the full Leading Lights shortlist here, and below are the finalists -- in alphabetical order -- for 2015's best deal maker.
AT&T Inc. (NYSE: T) has spent big in the past year to grow in two important ways: expanding its wireless footprint into Mexico with the $2.5 billion acquisition of Grupo Iusacell S.A. de C.V. and $1.875 billion acquisition of Nextel Mexico and acquiring a huge video presence with the soon-to-close acquisition of DirecTV Group Inc. (NYSE: DTV)
While these are its biggest deals of the year, they are far from the only ones. The carrier also announced a joint venture with the Chernin Group for online video and over-the-top (OTT) video services, divested its Connecticut wireline assets to Frontier Communications Corp. (NYSE: FTR) for $2 billion and spent $18.2 billion to acquire valuable wireless spectrum in January's Federal Communications Commission (FCC) auction to support the growth in video.
All in, these deals are helping to transform AT&T and how and where it does business. AT&T says that by the end of 2015, it will be a very different company -- one with a diversified revenue mix, ability to uniquely integrate new products and services and deliver video to any device, and one that is much less dependent on the US consumer wireless market.
- AT&T Makes More Moves in Mexico
- AT&T Eyes TVE Blitz With DirecTV
- AT&T to Buy Nextel Mexico for $1.9B
- AT&T Names Iusacell CEO, Closes Acquisition
- FCC Spectrum Auction Tops $40B in Bids
- AT&T's Mexican Capex Dance
- AT&T to Buy Iusacell, Plans Lower Capex For 2015
- AT&T: Merger Review Halt Won't Hurt Us
- AT&T's OTT Venture Buys Creativebug, Calls Itself Otter Media
IP networking vendor Brocade Communications Systems Inc. (Nasdaq: BRCD) has made three acquisitions in the past year that help make it one of the leaders in virtualization. In September, it acquired analytics vendor VistaPointe, followed by a February acquisition of Riverbed Technology Inc. (Nasdaq: RVBD)'s SteelApp business and a March acquisition of Connectem, all of which round out its SDN and NFV strategy.
VistaPointe brings virtualized analytics tools to Brocade's NFV portfolio, helping network operators classify, visualize, manage and secure subscriber data traffic as they deploy LTE, potentially even setting them up for the eventual migration to 5G. Likewise, its SteelApp acquisition adds virtual application delivery controllers (ADCs) to Brocade's list of software networking products, and the Connectem acquisition adds the virtual evolved packet core (vEPC) element to Brocade's portfolio for the data center.
- Brocade to Acquire Connectem for Virtual Mobile Networking
- Brocade Scoops Up Riverbed's SteelApp ADC
- Brocade Buys NFV Management Smarts
Equipment giant Ericsson AB (Nasdaq: ERIC) is no stranger to deal making and this past year saw it add several companies in strategic growth areas to its arsenal. The company has been ahead of the curve on professional services and systems integrators and the purchases it made in the past year will help it compete in the ever-important areas of SDN, NFV and the cloud.
The acquisitions include media services company Red Bee Media, billing vendor MetraTech, cloud company Apcera, Fabrix for TV and media, Ambient in the smart grid, Sentilla in analytics and TimelessMIND for OSS/BSS.
Small but smart acquisitions like these will continue to be important to Ericsson, especially as it is potentially facing competition from a combined Nokia Networks and Alcatel-Lucent (NYSE: ALU). (See Ericsson Not Planning Big M&A Response to Nokia/AlcaLu.)
- Ericsson Buys Telecom Biz of Chinese IT Firm
- Eurobites: Ericsson Strengthens Its Analytics Hand With Sentilla Buy
- Ericsson Acquires Bankrupt Smart Grid Co
- Ericsson Buys Cloud Video Firm for $95M
- Ericsson Goes Beyond Telecom with MetraTech Acquisition
- PaaS It On: Ericsson Buys Into Cloud Startup Apcera
- Ericsson Completes Red Bee Media Acquisition
Level 3 Communications
Level 3 Communications Inc. (NYSE: LVLT) closed its $7.3 billion acquisition of tw telecom on Halloween last year, but the only thing scary about the deal was how well the two companies fit together. Level 3 brought the fat fiber optic pipes, global reach and data center connections, while tw telecom brought its strong metro network connections, enterprise prowess and dynamic capacity services to the table. Together, the companies tell a compelling and comprehensive story in the enterprise and carrier space.
In North America, the deal also doubled the company's sales force and boosted its enterprise revenue by 5%. By combining tw telecom's metro footprint with Level 3's global network, its customers were also able to go beyond North American for local-to-global business.
The companies are still in the process of evaluating the best components of each of their portfolios to offer to customers, and Level 3 says to expect enhancements to its core cloud connect, Ethernet and data center products in the coming months.
- Level 3 Completes tw telecom Purchase
- Can Level 3 Execute the Perfect Merger?
- Level 3 CTO Jack Waters: Network Integration Guru
Our smallest company on the short list, SpiderCloud Wireless made the cut not for a big M&A deal, but rather a smart partnership that will give it a much bigger presence in small cells. The vendor announced a deal with Cisco Systems Inc. (Nasdaq: CSCO) in February that will see Cisco resell SpiderCloud's entire portfolio of small cells, as well as integrate its 3G/4G radio attachment to Cisco's own access points. It's an important validation for SpiderCloud, but a more important opened door to a huge new global market for it.
SpiderCloud had already racked up enterprise small cell wins with 12 operators in the past year, including Vodafone Group plc (NYSE: VOD) and Verizon Wireless , but the partnership with Cisco -- and a rumored forthcoming one with Nokia -- will grow its profile even more, helping it take on big names like Ericsson AB (Nasdaq: ERIC) and Huawei Technologies Co. Ltd.
SpiderCloud also managed to raise another $25 million funding round in January, bringing the total investments in the privately held company to $125 million.
- Cisco to Resell SpiderCloud's Small Cells
- Telcel Turns Up SpiderCloud's Enterprise Small Cells
- SpiderCloud Evolves Its Small Cells
- SpiderCloud Banks $20M in Fresh Funding
- SpiderCloud Shipping LTE Biz Small Cells
The Leading Lights 2015 winners and newest class of Hall of Fame inductees will be unveiled at the Leading Lights awards dinner, which will be held the evening of Monday, June 8, at Chicago's Field Museum. The star-studded soirée will follow a day of special workshops covering topics such as SDN, 5G and Carrier Ethernet for the Cloud that take place ahead of Light Reading's Big Telecom Event (BTE), which this year is being held at the McCormick Place convention center on June 9 and 10. (Details and the agenda are on the show site above.)
— Sarah Thomas, , Editorial Operations Director, Light Reading