Software and Technology Monthly Newsletter
In This Edition:
Highlights from June
Public Market Dashboard
The Whitehorn Matrix
How to Benefit from Defence Spending Increase
Financing
Mergers and Acquisitions
Highlights from June
June 4 - Google to provide $13MM funding to expand AI skills development and training programs across Canada.
June 5 - The federal Global Innovation Cluster for digital technologies (DIGITAL) to invest $15MM across 16 AI-focused workforce development and skilling programs nationwide.
June 17 - The federal government to introduce open banking legislation to allow Canadians and businesses to securely share financial data with third parties other than their banks alone.
June 25 - Canada, along with other NATO allies, commit to invest five per cent of GDP on defense by 2035 (3.5% on core defense and 1.5% on defense-related investments including infrastructure).
June 30 - The federal government rescinds the Canadian Digital Services Tax imposed on US tech companies following US President ending all trade negotiations with Canada because of the tax.
Public Market Dashboard - Year-to-Date Returns
The Whitehorn Matrix
Check out our Matrix for the latest and greatest in tech:
How to Benefit from Defence Spending Increase
On June 25, PM Mark Carney announced Canada will invest 5% of GDP on defence by 2035 to meet its NATO defense spending targets. The spending increase will be executed based on four pillars:
Investing in military personnel & equipment
Expanding military capabilities
Diversifying defence partnerships
Strengthening domestic defence industry
To achieve the nearer term target of 2% by March 2026, Canada will need to spend an additional $9.3B by next March on defense. In addition, the PM emphasized the need to prioritize investing in Made-in-Canada solutions and supply chain to accomplish this.
What this means is that private Canadian companies in key sectors stand to benefit from the increase in domestic defense spending. We investigate how the software & tech industry can benefit and how business owners like you can prepare accordingly:
We expect the emphasis on:
Cybersecurity
IoT surveillance
Data encryption and quantum computing
This serves as a key opportunity for Canadian software & tech business owners to act now or miss out on potential lucrative government contracts. The first wave of government contracts will likely be awarded to larger publicly traded companies. However, the ripple effect will surely benefit small to medium sized enterprises as well.
Financing
Below we summarized a few recent tech financing transactions:
Mergers and Acquisitions
Application Software:
June 24 – Toronto based EcoOnline acquires Irish company D4H. Acquisition of crisis readiness and response software provider to integrate safety and sustainability suite into its ESG offerings.
June 24 – Montreal based Valsoft acquires Ottawa based Alessa. Acquisition of anti-money laundering compliance, controls monitoring and fraud management solutions provider to enter the RegTech and financial crime risk space.
June 30 – Vancouver based Clio acquires Spanish company vLex. Acquisition of legal intelligence platform provider to complement Clio's legal research platform.
IT Consulting & Services:
June 2 – Alithya Group (TSX:ALYA) acquires Plano, TX based eVerge Interests. US$23.5MM acquisition of enterprise applications and transformation services provider with expertise in Salesforce CRM and Oracle HCM and CX with 160 professionals across the U.S. and India.
June 2 – Norwalk, CT based SDG acquires Toronto based Synergetika Group. Acquisition of solutions provider specializing in privileged access management to strengthen delivery capabilities and deepen expertise in securing critical systems.
June 5 – French company Havas acquires Toronto based Enverta Digital. Acquisition of CRM and digital transformation services provider to enhance capabilities and further deliver integrated, tech-enabled solutions.
June 10 – Edmonton based Accurate Network Services acquires Edmonton based Shift Support. Acquisition of IT services company to expand Alberta market presence.
June 17 – Dartmouth, NS based ABM Integrated Solutions acquires Calgary based Plenum Group. Acquisition of managed IT services provider operating in Western Canada to expand offerings nationwide.
June 17 – Vancouver based Transoft Solutions acquires Slovenian company Cgs Labs. Acquisition of specialized software solutions developer for transport infrastructure design, weather information systems and environmental monitoring to enhance Civil & Transportation portfolio.
June 17 – Kanata, ON based Magnet Forensics acquires Chantilly, VA based Dark Circuit Labs. Acquisition of advanced vulnerability R&D company providing tools for cyber arsenal and offensive operations to further expand ability to support federal projects.
June 18 – French company Teleperformance acquires Vancouver based Agents Only Technologies. Acquisition of AI-enabled crowdsourcing gig work platform that mobilizes domain experts globally to expand data services and to enable faster project delivery.
Data Processing & Outsourced Services:
June 3 – Montreal based Leger acquires Toronto based Rank Research Group. Acquisition of provider of ad and concept testing, information audits, traditional research, big data mining company to enhance Consumer Insights division.
June 5 – French company Pasqal acquires Montreal based Aeoponyx. Acquisition of photonic integrated circuits company to strengthen hardware platform and to accelerate roadmap to fault-tolerant quantum computing.
June 11 – Latvian company Paynt acquires Vancouver based E-xact Transactions. Acquisition of payment processing firm which processes $3.5B annually across 50MM transactions to expand market presence in North America.
June 18 – Toronto based Pesa acquires UK based Authoripay Emony. Acquisition of electronic money institution to accelerate plans to scale remittance and payment services across Europe, as well as to expand regulatory reach and card issuance capabilities.
June 24 – Hive Digital Technologies (TSXV:HIVE) acquires Toronto based data centre facility. Acquisition of 7.2MW facility to expand high performance computing capacity and to launch an AI data centre with liquid-cooled infrastructure.
Systems Software:
June 2 – Pittsburgh based Print ePS acquires Toronto based Avanti Computer Systems. Acquisition of print MIS workflow automation solutions provider for commercial print service providers to strengthen midmarket print segment position and expand global tech portfolio.
June 3 – Toronto based Banyan Software acquires German company star/trac supply chain solutions. Acquisition of yard and transport management solutions provider for the chemical, industrial and logistics sectors to expand presence in the logistics and industrial sectors.
June 16 – Toronto based Volaris Group acquires Thunder Bay, ON based 4Site. Acquisition of integrated enterprise asset management suite of solutions provider for asset-intensive businesses to enhance asset management business unit.
June 16 – Undisclosed party acquires Langley, BC based ThinkCX Technologies. Acquisition of advanced market intelligence solutions provider for the telecom industry from Plank Ventures (CSE:PLNK).
June 25 – Toronto based Jonas Software acquires Toronto based CAST Group of Companies. Acquisition of developer of software and hardware solutions for the entertainment, special events, and meetings industries to expand Media Solutions vertical by subsidiary of Constellation Software.
Internet Services & Infrastructure:
June 4 – Burlington based HostPapa acquires Irvine, CA based CloudBlue Technologies. Acquisition of cloud distribution and subscription commerce platform from Ingram Micro (NYSE:INGM) to strengthen cloud services offering.
June 27 – Alset AI Ventures (TSXV:GPUS) acquires Vancouver based Cedarcross International dba Lyken.AI. Acquisition of remaining 25% interest in cloud computing company to enhance AI infrastructure platform.
June 27 – OSL Group (0863.HK) acquires Toronto based Banxa (TSXV:BNXA). Acquisition of crypto infrastructure provider enabling embedded crypto within payment platforms to enhance global crypto infrastructure and services.
