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Technology companies may have courted to rivals offering good price and seductive in 2008, but this year is nothing more sexy to close insurance arrangements.


No signs of an imminent economic recovery, technology companies focused on producing decent earnings and trying to cope with falling stock prices and the attitude of customers economical.

When you consider opportunities to acquire a rival, firms are more cautious and prefer to reach agreements that do not exhaust its cash and in what the company has purchased a healthy business, which generates cash that can be absorbed without pain.


That means that 2009 could well be the year of small and medium agreements indicated bankers and venture capital investors.

There could be a series of multimillion-dollar purchases, especially if Microsoft Corp. revives its bid for Yahoo Inc.


But the huge plays only a small part of the turnover of technology this year, compared with those of the past five years, they said.

The bankers said that they are preparing for business in the "middle market" that the agreements would cover less than 500 million dollars.


"Large companies, strategic and probably not very effective processors make significant acquisitions," said Jeff Bistrong, who leads the group of technology investment banking Harris Williams. On the contrary, he expects more purchases in the size of a mouthful. "

"Most (of companies) keep powder dry and liquidity as it can, given the slowdown in this interim period," said Bistrong.


A WAVE OF SMALL AGREEMENTS

The bankers said that technology will not have many agreements in the early months of the year, but the pace accelerated modestly anger in the second half as they continue down the values of the companies targeted.


Peter Falvey, co-founder of Revolution Partners, an investment bank specializing in technology, said the activity would increase by the end of the first quarter, when buyers and sellers to assess how much money they have and how they see their profits.

Even then, most of the agreements is around 50 and 250 million dollars, he said. The acquisitions will not have the glamor of the supply of 47,500 million dollars that Microsoft made to Yahoo or the sale of Electronic Data Systems to Hewlett-Packard Co by 13,000 million dollars.


These agreements, even if they have money, they often involve high risks of integration, that companies do not want to assume in a market that went out the prospects for growth.

The big banks like JP Morgan, Morgan Stanley and Credit Suisse, which traditionally have the most succulent arrangements, banks are struggling with the "mid-market agreements for less than $ 200 million," said the head of a group of high technology bank, who asked not to be identified because his comment is related to the company's strategy.


A PricewaterhouseCoopers report on the outlook for mergers and acquisitions in 2009 predicted that in the technology segment, there will be an "aggressive procurement activity by industry leaders as (...) advantage of low prices, which occur once per decade, to fill gaps in its portfolio and strategic arrangements for cross-sector processors.

There will be action in the areas of Internet, software, computers and networks, said the report. The green technology is another area where bankers expect agreements.

And in the segment of the chip, desperate to cut costs, manufacturers could seek out partners.