Plenty of deals cropped up last year in the financial IT industry, and it may be ripe for even more in 2011. According to mid-market investment bank Berkery Noyes, deals increased 30 percent to 238 in 2010 from 183 in 2009, and transaction value increased 27 percent to $20.52 billion in 2010 from $16.14 billion in 2009. About one-third of 2010's deals took place at values between $7.4 and $54.6 million.

Capital Markets was the most active segment, powered in part by notable deals in the investment research vertical. Morningstar was an active acquirer and will likely remain so in 2011.

Chris Young, Managing Director at Berkery Noyes, tells us, "In a market where supply is substantially greater than demand, independent investment research firms will continue to join forces with companies of equal size. While many of these deals will be at the lower end of the middle market,  the expectation is the combined companies will, over time, provide multi-asset global research capabilities in line with larger firms like Morningstar."

Low trading volumes and heightened regulatory scrutiny may also lead to more deals. We would expect the big boys of the IT universe--IBM, Oracle and others--to continue to make selective purchases that fit their platforms.

For more:
- here's a release

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