Google gets hungry for M&A deals

Posted Oct 16th 2009 12:00PM by Tom Taulli
Filed under: Competitive Strategy, Google (GOOG), Cisco Systems (CSCO), Dell (DELL)

While the tech sector has held up fairly well during the economic downturn, the dealmaking has lagged. But lately, there has been an uptick activity, such as from companies like Dell (NASDAQ: DELL) and Cisco (NASDAQ: CSCO).

Well, according to Reuters, it also looks like Google (NASDAQ: GOOG) is setting its sights on mergers and acquisitions (M&A).

No doubt, the search giant is in an ideal position. As seen with the latest quarterly report, Google continues to pump out huge amounts of cash flows. At the same time, the market cap is at $173 billion, giving the company lots of clout.

While Google has focused mostly on small deals, this may change. In fact, it looks like the company may strike a big deal every year or two.

So, what companies may Google target? For the most part, the company wants something that has a signficant strategic alignment, such as by providing increased revenues or finding new customers. While this is farily vague, it is definitely a change in direction for Google and is sign that the company realizes that -- if it wants to continue growing -- it will need to get more aggressive with M&A.

Tom Taulli is the author of various books, including The Complete M&A Handbook.

Tags: Cisco, CSCO, Dell, GOOG, Google, inthenews, Mergers