Has the electronics manufacturing industry finally lost its power? The industry enjoyed record growth during 1998, 1999 and into 2000; with many companies reaching over 100% increases in annual top line revenue growth. As the market slowed, companies scrambled to conserve cash and position to survive the shakeout. As a result, mergers and acquisitions have become a survival strategy for many companies while stronger players are using this market downturn to enhance their product offerings through strategic acquisitions.

The embedded software space has seen significant merger and acquisition activity in recent years. While the industry is expected to grow 16% per year through 2004, the consolidation of small and mid-size embedded software firms continues to increase the margin pressure felt by many firms in the industry.

The growth of the satellite communication industry has been fueled by booming demand for mobile communication, global positioning service, and broadcasting. According to the Satellite Industry Association (SIA), the commercial satellite industry generated $81 billion in global revenue in 2000, with revenue segmented into four sectors: 1) services 2) ground equipment 3) satellite manufacturing and 4) launching.

Despite several market and technological challenges, the Customer Relationship Management (CRM) industry is alive and kicking with increased sales and market penetration, moderate investment levels, and increasing M&A activity.

The specialty food segment underwent significant consolidation in 2000. Rapid growth rates in key demographics, including health-conscious consumers, should make the small- and mid-sized acquisitions of niche food companies more profitable in the long run than many of the recent mega-mergers in the industry.