Here are the 6 tech companies most likely to be acquired next, according to Morgan Stanley
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There has been plenty to keep dealmakers busy in the technology sector so far this year.
Microsoft is acquiring LinkedIn for $26 billion, and computer-security company Symantec is buying Blue Coat Systems for about $4.65 billion in cash. Oracle agreed to buy cloud software provider Netsuite for $9.3 billion.
"Non-traditional buyers" are joining the fray, with companies like GM and Bed Bath and Beyond gobbling up startups now, according to Marc Andreessen, cofounder of venture capital firm Andreessen Horowitz. Private equity's infatuation with tech has also spurred a flurry of deals this year.
Morgan Stanley's equity strategists, led by Adam Parker, updated their ranking of companies the bank thinks could get acquired in the next 12 months, according to a proprietary model analyzing the companies' finances.
Even though the overall pace of M&A activity slowed to 6.5% of public tech companies receiving a buyout offer last quarter, there are bright spots within the sector. The tech hardware and equipment industry group, for example, stood out with 10.6% of stocks getting an offer, according to the bank's research.
Here's a list of companies in the tech sector that Morgan Stanley thinks have a high probability of getting a buyout offer in the next 12 months.
1. Take-Two Interactive Software
Phil McCarten/ReutersWhat: A New York-based publisher, developer, and distributor of video games.
Market cap: $3.81 billion
Recent news: The firm faced a lawsuit from Lindsay Lohan, who alleged the company used her likeness in the game "Grand Theft Auto V" without permission. The case has been tossed out of court, according to Bloomberg News.
2. Cypress Semiconductor Corp.
Kimberly White/ReutersWhat: The San Jose-based company is one of the largest makers of SRAM, a memory chip that is used in consumer electronics.
Market cap: $3.8 billion
Recent news: The firm is pushing car makers to incorporate its chips, with applications including wireless radios and touch displays.
3. Brocade Communications Systems
Robert Galbraith/ReutersWhat: The San Jose-based firm supplies enterprise networking hardware.
Market cap: $3.62 billion
Recent news: In May, Brocade acquired wireless network equipment maker Ruckus Wireless Inc. for $1.5 billion. It's Brocade's latest efforts to tap into the growing Wi-Fi market.
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