in Canada, Exits, Mergers & Acquisitions

Did we hit a billion?

Dr. Evil "One Billion Dollars"Today IBM just announced the $387MM acquisition of Toronto-based Algorithmics. It begs a couple of open questions. Is Algorithmics after being sold to Fitch for $174MM in 2004 still a Canadian startup? Can a 30 year old company like MKS be considered a startup? Is Eloqua who’s HQ moved to Virginia still a Canadian company?

If you imagine that Algorithmics is the second Canadian software startup acquired for more than $300MM in the past 6 months. Then to answer Dan Morel’s question,  if this was “The One Billion Dollar Year” for Canadian startup acquisitions, yes it is.  Only if you consider Algorithmics still a Canadian startup and 30 year old MKS a startup, then combined with Radian6 the acquisitions total just over $1B, everything else is icing on the proverbial cake.

Congratulations to the Algorithmics team and alumni.

Adding to the TechVibes list of Canadian Acquisitions:

1/5/2011 – Victoria’s Flock acquired by Zynga

1/6/2011 – Edmonton’s Attassa acquired by YouSendIt

1/31/2011 – Toronto’s Adenyo acquired by Motricity for $100 Million

2/8/2011 – Toronto’s MyThum acquired by OLSON

3/3/2011 – Toronto’s CoverItLive acquired by Demand Media

3/11/2011 – Vancouver’s Sayvee acquired by Bandzoogle

3/26/2011 –  Waterloo’s Tiny Hippos acquired by RIM

3/30/2011 – New Brunswick’s Radian6 acquired by Salesforce for $326 Million

4/7/2011 – Waterloo’s MKS acquired by Parametric Technology for $292 Million

4/8/2011 – Toronto’s PushLife acquired by Google for $25 Million

4/27/2011 – Montreal’s Tungle acquired by RIM

4/28/2011 – Montreal’s Coradiant acquired by BMC

5/10/2011 – Toronto’s Conversition acquired by e-Rewards

6/3/2011 – Waterloo’s PostRank acquired by Google

6/7/2011 – Toronto’s DealFrenzy acquired by Intertainment Media

7/8/2011 – Toronto’s FiveMobile acquired by Zynga

8/30/2011 – Vancouver’s Zite acquired by CNN for an estimated $25MM

9/1/2011 – Toronto’s Algorithmics acquired by IBM for $387MM



  1. The Eloqua IPO is priced at $100mm, so I think we’re close to $1.5B with a full 4 months to go…  do I hear $2B???

  2. Lots of great liquidity going on which is excellent to see. Particularly
    great to see larger exits, north of $200m, which have been sorely
    lacking the last few years.

    Question though – is Eloqua still considered a Canadian company? What
    criteria are we using for deciding if something is “Canadian” here? If
    Eloqua is “Canadian” then you can also count SiGe as part of this list
    (sold for USD$210m) one could argue….

    Also, sidenote: “filing” for an IPO can not be considered an exit, regardless of criteria used….

  3. Hey David, I like the article and the excitement that it can create.  I’d obviously like to see our own name appearing in the next couple of years on a similar list.

    But the list has a couple of problems though;  MKS and Algorithmics are not startups.  MKS was nearly 30 years old.  Algorithmics is also at least 15 years old and was no longer a “Canadian” company.

    Q4 should also be a great quarter for exits given information that I’ve heard from several sources. 

  4. Eloqua felt like a super CDN story in the early days – I remember going to their Toronto office and them trying to sell some stuff to me in their early days.  Definitely feels like it was “built in Canada” during its formative years and we should celebrate them.  But its a tricky question – could make similar arguments about Coradiant as well, built in Canada but kinda relocated later on.

    Also, I just heard Algorithmics doesn’t really count since they had already sold to Fitch like years ago.  I suppose Warren Buffet needed his chunk of that $200mm though.

  5. We may be headed in the right direction, but this is still anemic compared to Canada’s potential. We get excited at these sparks of activity, but let’s look at the big picture:

    Starting point:  Canada is 10% of the US (GDP to GDP), so why not claim 10% of Tech M&A activity. 

    – US Q2 2011 Tech M&A $52 billion. Did we do $5billion in March-June? Not even a fraction of that
    – US 777 deals in that same quarter. Canada: 3-4? 

    Ok, we can’t be 10% for several reasons. But how about 5%? 
    As it stands, we’re barely at 1% of the US, and that’s not acceptable nor a cause for celebration. It’s a reason to worry.


  6. Yes, Eloqua was definitely born and bred in Canada.
    My point is if we’re going to measure and celebrate this stuff we need some more structured criteria.
    Eloqua is a great company, but again, just because a company filed for an IPO doesn’t mean it will actually get public and/or deliver returns to investors.
    If you are going to include filers in the criteria there are a number of others missing.

  7. I agree, wait for actual offering, not filing – I am prematurely cheerleading.  I know the filing not equal offering story only too well (Redknee we started/stopped a few times). 

  8. Baby steps!  There were almost no in the mid 2000s, now we’re at least growing.

    Also I think US is the wrong benchmark.  They are the global leader in technology.  I wonder how we match up to other G20 countries on a per-capita basis.

  9. I disagree. The US is the right benchmark. Forget the G20’s. We shouldn’t lower the bar on Canada’s potential. 
    Better than before is not good enough. I’m in the trenches and don’t want us sugar-coating reality. 

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