Oct. 4--When Cisco Systems CEO John Chambers all but announces he's going on a shopping spree, does his list include a smart-grid tech startup, consumer electronics -- or both? And what might be next for Oracle's Larry Ellison, assuming the $7.4 billion deal for Sun Microsystems gets finalized?

Mergers and acquisitions, also known as MandA, are back on the front burner in Silicon Valley. Corporate chieftains, venture capitalists, startup entrepreneurs and their attorneys have been busy cooking up deals large and small in an atmosphere that blends calculation, optimism and, in some cases, desperation.

The optimism arises from the renewed confidence in the economy. Deals such as Cisco's $3 billion acquisition last week of Tandberg, a videoconferencing innovator, and Adobe's $1.8 billion acquisition two weeks ago of Omniture, a Web analytics firm, wouldn't have happened amid the financial industry meltdown and the tumult on Wall Street, analysts say, because values were so hard to determine.

Giants such as Cisco, which has $35 billion cash on its balance sheet, and smaller public companies such as Intuit, with $1.4 billion in its wallet, have emerged from the crisis in a mood to buy. Leaders of such companies "are thinking, 'What will drive growth? What will drive innovation?' " said venture capitalist Bruce Golden of Accel Partners.

"It's an interesting time for the large-cap companies to acquire growth stories, talented teams and

distinctive (intellectual property) and then leverage that through their giant distribution systems," he added.

Mountain View-based Intuit aimed to do that this summer by paying $170 million each for valley startups PayCycle, an online payroll service, and Mint.com, an online system for managing personal finances, according to Intuit's chief corporate strategy officer, Greig Coppe.

The Darwinian economy, Coppe noted, minimized competition for appealing companies and allowed more time for due diligence. "We have had a number of potential acquisitions go pretty far down the pipeline that we did not close, because something hasn't proven out," Coppe said. Intuit, he said, is actively scouting other possible deals.

September brought a sharp uptick in MandA activity, according to the 451 Group, a firm that analyzes the tech industry. The month began with the $2 billion "carve out" deal for Skype, in which eBay sold 65 percent of the company to a consortium led by the Menlo Park-based private equity group Silver Lake Partners, with participation by venture firms Andreessen Horowitz and Index Ventures.