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Global M&A soars as acquirers make up for lost time

Matthew Toole
Matthew Toole
Director, Deals Intelligence

The market hiatus of a year ago is a distant memory, as 2021 becomes the biggest year for global M&A ever, with records smashed across categories. Existing segment leaders were also the biggest winners: the U.S., the technology sector, private equity, and Goldman Sachs.

  1. Globally, 2021 is the strongest opening nine months of M&A since records began. In the U.S. alone, target M&A has surged 139 percent to US$2trn.
  2. Private equity deals have more than doubled to hit record US$839.6bn, and the number of deals was up by 65 percent. Favoured sectors included technology, healthcare and retail.
  3. So far in 2021, 757 deals worth more than a billion dollars have been announced.

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There is still three months to run and already 2021 is a giant anomaly in terms of global M&A levels. World-wide deal-making has topped US$4.4trn from more than 40,000 transactions, making it the strongest opening nine months of any year since records began in 1980.

Watch – Q3 2021: A supercharged environment for M&A | The Chatter

Deal-making fell off a cliff in the first half of 2020, as corporate acquirers hesitated in the face of the COVID-19 pandemic. But the bounce-back has more than compensated, with Q3 2021 the largest on record and the fifth consecutive quarter to top US$1trn.

While all major regions have seen strong growth and set all-time records, the U.S. is way ahead of the pack with a 139 percent year-on-year increase, to account for 45 percent of the global market. Meanwhile, Europe and Asia-Pacific were hardly slouches, surging 69 percent and 53 percent, respectively.

The resurgence has been in both very large deals and mid-market companies.

In the third quarter of 2021, deals with a transaction value in excess of US$10bn increased 50 percent compared with the same period last year, while deals with a transaction value between US$1bn and US$5bn were up by more than 130 percent.

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Buyout bounce-back

Private equity sponsors, unusually quiet during 2020, have been making up for it, with global private equity backed M&A reaching US$839.6bn, more than doubling the level from a year ago.

Meanwhile, the number of private equity deals was up by 69 percent.

Favoured sectors for the buyout barons were technology, healthcare and retail, with the latter seeing a significant year-on-year increase.

Overall, 2021 has been the biggest year for private equity since records began in 1980, with the industry accounting for nearly one-fifth of the global M&A market.

By contrast, the heat appears to be coming out of the SPAC market.

These special purpose acquisition companies have announced 275 ‘combinations’, worth US$545.8bn, so far during 2021, accounting for 12 percent of total global M&A. However, activity peaked in February and since Q2, the number of deal announcements has fallen 7 percent, despite a 12 percent increase by value.


Tech expands its lead in global M&A

In terms of sectors, technology continues to ‘eat the world’, with an astonishing 133 percent increase in global M&A so far this year, to reach US$888.2bn of announced deals, and an all-time high.

The sector now constitutes 20 percent of the M&A market, trailed by financials in a distant second place, constituting 12 percent of the global M&A market.

Even so, acquisitions of financial companies have increased by 82 percent compared with last year, to hit a 14-year high of US$537.4bn.

M&A rankings for the top advisors show how globalised the market has become, with Goldman Sachs taking top place in every region, while JPMorgan, Morgan Stanley, Citi and BofA Securities consecutively taking places 2-5 in the worldwide, U.S. and European tables.

In Asia-Pacific, UBS upset the pattern to take second place, after Goldman.

Despite this bias towards large institutions, independent advisory firms were placed among the top 25 global financial advisors, led by Evercore Partners and Lazard.


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Access unmatched financial data, news and content coverage in a highly customized workflow experience built just for you. Global M&A soars as acquirers make up for lost time