Microsoft is conducting a million-dollar shopping session.
The company recently agreed to pay as much as $ 19.7 billion for Nuance Communications, which assists artificial intelligence to health professionals, in a deal that came not terribly long after the acquisition of video game publisher Zenimax Media last year not.
Meanwhile, Microsoft is said to be in exclusive talks to acquire the online group chat platform Discord for as much as $ 10 billion, which previously bid on the US operations of the viral video app TikTok, and was allegedly in an unhappy conversation with Pinterest for what would have been multibillion-dollar deal.
The company has the money to spend, ending its 2020 financial year with $ 136 billion in cash after the pandemic forced a shift to remote work and led to a boom in Microsoft’s cloud and productivity software. Experts say that with its rising market capitalization of nearly $ 2 billion – and its leading competitors slowed by regulatory scrutiny – we can expect Microsoft to open its wallet to large and small companies for the rest of the year.
“Microsoft is on the M&A war path over the next 12 to 18 months and Nuance could be the first step in a greater appetite for transactions in 2021,” Wedbush Securities analyst Dan Ives said in a note to customers.
Insider asked nine industry analysts which companies could be next on Microsoft’s shopping list, as it wants to strengthen its existing businesses and break into new businesses via acquisitions.
Some analysts believe that Microsoft could use M&A to sharpen its cloud division, where it is considered the biggest player behind Amazon Web Services’ market leader in cloud computing. This is especially important because Google is making progress and IBM and Oracle are inventing their own niches in the market.
It could also continue on the path laid out by the Nuance agreement and buy more AI businesses, which will enhance its presence in a key technology sector. Other experts have suggested that Microsoft explore new ventures in spaces as diverse as geothermal energy or the removal of ‘rogue drones’. Some have suggested that Microsoft could spend more than ever before on established names like Twilio, Okta or even Twitter.
Here are 22 companies that analysts say make sense for Microsoft to acquire. (All valuations of private enterprises have been taken from Pitchbook, unless otherwise stated, while the information on public companies is accurate from Friday afternoon.)