M&A in Tech: What Recent Acquisitions Mean for CIOs

February 17, 2025 shubham

No one knows more about mergers and acquisitions (M&A) than the tech industry. Larger corporations often purchase smaller ones to enhance capabilities, access new markets or reduce rivals. In recent years, we’ve observed some prominent deals reorganizing the industry framework.

These acquisitions come with opportunities as well as challenges, particularly for Chief Information Officers (CIOs). From integrating new technologies and maintaining cybersecurity to managing vendor relationships, CIOs play a role in navigating the impacts of M&A on their organizations.

Explore recent tech acquisition trends, their implications for IT leaders, and steps CIOs can take to adapt.

The Tech Industry’s M&A Boom

The tech industry is also at an all-time high when it comes to M&A activity. Frenzied companies are scooping up startups and rivals to solidify positions in cloud computing, artificial intelligence (AI), cybersecurity, and more.

Some of the largest recent acquisitions include:

Microsoft’s purchase of Activision Blizzard ($69 billion, 2023) – An attempt to bolster its gaming and metaverse ambitions.
Broadcom buying VMware ($61 billion, 2023) – A move to make itself the mind of cloud computing and enterprise software.
Slack, acquisition by Salesforce ($27.7 billion, 2021) – A strategic move to double down on work-from-home infrastructure.
AMD: Acquired Xilinx ($35B, 2022) — AI, data centre, and edge computing

These deals are a reminder of how big tech players are trying to become future-proof. But what does that mean for CIOs running IT infrastructures?

The CIO’s Tech M&A Conundrum: Four Questions to Consider

Acquisitions can certainly provide new creativity and growth, but at the same time raise some hurdles for CIOs. Let’s consider some of the major risks:

1. Integration Complexities

Merging IT infrastructures, software platforms and security protocols can be a nightmare when one company acquires another. Different companies have different systems and that poses a huge challenge to migrate seamlessly without disrupting operations at any point in time.

CIOs need to decide whether to combine existing systems or continue separate systems. They must also make sure data migration occurs securely and promptly.

2. Vendor and Licensing Issues

An acquisition may trigger contract renegotiations with software vendors, service providers, etc. If a CIO’s organization uses software from a newly acquired company, licensing terms could change and increase costs or create compliance questions.

To prevent surprises, CIOs should carefully review vendor contracts at the early stages of the M&A process and negotiate preferable terms.

3. Risks in Cybersecurity and Data Privacy

IT system mergers involve integrating cybersecurity policies, which could aggravate vulnerabilities. A company being purchased may have lax security practices, potentially jeopardizing the parent company.

To remedy this, CIOs should perform in-depth cyber audits and create a policy guide to uniform security practices that safeguard sensitive information. You must also take into account regulatory compliance (GDPR, CCPA, etc).

4. Challenges Around Employees and Culture

M&As usually bring about layoffs, restructuring, and uncertainty for IT teams. Divergence in company cultures, tools, and workflows may create friction.

CIOs must focus on helping employees transition smoothly and therefore implement clear communication plans, training programmes, and change management strategies.

5. Disruptions to IT Strategy

An acquisition can require changes to a company’s long-term IT roadmap. New leadership might shift priorities, delay ongoing projects or demand new technology integrations.

CIOs must be nimble and prepared to adjust their IT strategies while keeping current digital transformation initiatives on track.

Creating Opportunity for CIOs In the M&A Process

Although there may be challenges, M&As can also offer CIOs an exciting opportunity to energize IT teams and help their organizations innovate and grow.

1. Access to New Technologies

Acquisitions frequently enable the introduction of advanced new technologies that CIOs can utilize for digital transformation. When Salesforce bought Slack, for instance, that gave CIOs new options for integrating communication and collaboration.

The CIO can leverage new capabilities with the strategic adoption of Tools to create operational efficiencies and business outcomes.

2. Stronger IT Capabilities

With new resources at hand, CIOs can scale their IT capabilities, whether it’s for cloud, AI or cybersecurity. Broadcom’s acquisition of VMware, for instance, gives enterprises stronger cloud solutions.

In addition, CIOs should evaluate how these acquired technologies fit into their existing IT ecosystem and examine potential synergies.

3. When you train it does not mean learning without you, it is trained on data to:

Reduction in Cost can be achieved by combining similar IT systems and refining processes. CIOs should seek ways to optimize cloud costs, software licensing and data-center operations.

This can ensure that IT investments are aligned with business objectives and maximize the value of the merger as a whole.

4. Stronger Cybersecurity Frameworks

M&As offer an opportunity to harmonize security controls and best practices throughout organizations. [ENREPLACEMENT]CIOs can advocate for more robust cybersecurity frameworks, which help protect data and ensure regulatory compliance.

5. Expanded Talent Pool

Another massive benefit is, that acquisitions usually come with tech-savvy experts talented in new-age tech. This is an opportunity for CIOs to build their teams and promote innovation.

Together, retaining this critical talent and promoting knowledge sharing will allow businesses to benefit from new ideas and technical know-how.

Steps CIOs Can Take to Ensure M&A Success

CIOs need to be proactive in ensuring a smooth transition. Here are some key strategies:

1. This is a part of this multi-part series about IT Due Diligence.

Before any integration can begin, CIOs need to assess the IT landscape at the acquired company. This includes:

Assessment of the existing infrastructure, applications, and data architecture.
Diagnosing cybersecurity vulnerabilities and compliance challenges.
Reviewing vendor contracts and licensing agreements

This detailed assessment will help CIOs decide how to move forward with integration and risk mitigation.

2. Create a Defined IT Integration Strategy

It is essential to know how to create a road map for IT integration. CIOs should outline:

A process for integrating IT systems
Sensitive data protectiveness (Security protocol).
Training schedule for employees on new technologies

A planned approach minimizes the impact on business.

3. Remember Security and Compliance (first)

As cybersecurity threats are increasing, CIOs have to tighten security policies. Key steps include:

Performing security audits and penetration testing.
Combining access controls with identity management systems.
The focus is on data protection regulations.

4. Notify Employees and Stakeholders

During an M&A, transparency is important. CIOs should:

Communicate IT developments and expectations to employees.
Work with business leaders on aligning IT goals with overall company objectives.
Offer training programs for a smooth transition.

5. Restructuring IT Performance After A Merger

CIOs should continue monitoring IT systems even after the merger. So regular performance audits are required to ensure correcting in time for continuous improvement.

By proactively addressing M&A challenges, CIOs can make rapid gains that pay off in the long run for the business.

Conclusion

The tech mergers & acquisitions landscape is changing more rapidly than ever. While they introduce integration challenges, licensing burdens and cybersecurity threats, they also provide new opportunities for CIOs to mine emerging technologies, streamline IT operations and increase cybersecurity.

For CIOs, success will depend on business and technology alignment, proactive outreach, and articulation of the IT integration process. Embracing change and maintaining agility will enable IT leaders to transform M&A disruptions into growth opportunities for their organizations. As the technological landscape shifts, CIOs are required to remain proactive, flexible, and able to navigate the nuances of an ever-evolving sector