Morgan Stanley executives speak out: AI mergers and acquisitions are fully rolling out, highlighting the value of infrastructure industry chain.

Wally Cheng, global head of technology M&A at Morgan Stanley, stated on Wednesday that with major enterprises rushing to fill technological gaps in areas such as chips, electrical power, networks, and infrastructure, M&A transactions in the field of artificial intelligence (AI) are showing characteristics of large transaction volumes and broad industry coverage. Cheng said in an interview, "I think the activity will cover all areas, including private and public markets." Cheng pointed out that while semiconductors supporting AI development have been widely regarded as "scientific miracles", the infrastructure supply chain serving the chip industry also has immense value, involving multiple links such as network equipment, storage, power supply, and real estate. At the time Cheng made the remarks, the AI sector saw another busy week of M&A transactions. On Monday, Alphabet Inc. Class C under Alphabet (GOOGL.US) and Blackstone Inc. (BX.US) announced a joint investment of $25 billion to establish a cloud AI enterprise; on Tuesday, analog chip giant Analog Devices, Inc. (ADI.US) announced a cash acquisition of Empower Semiconductor for approximately $1.5 billion to expand its AI power management product portfolio. Data from Bloomberg Intelligence shows that AI investments in the tech industry drove total M&A transactions to $90.11 billion last year. However, Cheng mentioned that valuing the AI sector is still "very challenging" and requires a balance between the potential of promising unicorns and a bright future, and the risks of execution. Tammy Kiely, Senior Managing Director of technology investment banking at Evercore Inc., expressed a similar view in the same interview. Potential acquirers must weigh the value they could create against the opportunity cost of missing out. With 27 years of industry experience, Kiely acknowledged that AI is triggering major industry upheavals, continuously driving companies to strategize. She noted that industry transactions and market opportunities are at unprecedented highs. Kiely stated that large companies have always relied on acquisitions for strategic transformations. She cited NVIDIA Corporation's acquisition of Mellanox Technologies Ltd. in 2019, which helped the company venture into data center components business. She also pointed out that M&A activity is especially active in the tech and semiconductor sectors, with more and more large corporations acquiring private companies through large-scale transactions. Kiely stated, "Some large companies are supported by strong profits, leading to extremely high valuations. Therefore, I believe it is not surprising to see more blockbuster M&A transactions in the future."