Tech M&A Activity Surges as Companies Seek AI Capabilities

Merger and acquisition activity in the tech sector has reached historic levels as established companies race to acquire AI capabilities. ## Deal Volume Tech M&A deals totaled $400 billion in 2024, with AI-related acquisitions accounting for over half of the total. ## Strategic Rationale Companies are buying AI startups to rapidly acquire talent, technology, and data that would take years to develop internally. ## Valuation Premiums AI companies command significant valuation premiums, with some deals exceeding 20 times revenue. ## Regulatory Scrutiny Antitrust regulators are paying close attention to tech consolidation, potentially limiting some large deals.