Skip to content

Steepest ever second-half decline in worldwide M&A

Matthew Toole
Matthew Toole
Director, Deals Intelligence

It was always a tough act to follow, but 2022 M&A activity underwhelmed across all regions and sizes relative to the year before. More concerningly, the direction of travel from H1 to H2 has been deeply negative. Some recovery in the U.S. during the closing months of the year is the only bright spot in a darkening deal making environment.

  1. Drop in M&A value of 33 percent since the end of June.
  2. Most declines continued into Q4, some levelling in the U.S.
  3. Private equity sponsors retreat in line with market.

For more data-driven insights in your Inbox, subscribe to the Refinitiv Perspectives weekly newsletter.

After the flood, the drought? Perhaps not yet, but after the boom year of 2021, world-wide M&A deal-making has hit reverse, with the second half of 2022 down 33 percent, the largest ever second-half swing since records began in 1980.

Compared to the same period last year, the decline was scarcely better – 37 percent down, the sharpest decline since 2001.

If you are a Refinitiv Workspace user, access our Deals Intelligence Insights here

The $3.6trn final tally for the second half of 2022 was more concentrated in larger deals, with the number of transactions down just 17 percent, touching a two-year low.

The biggest ticket deals, those in eleven-figures, have fallen ‘just’ 31 percent by value during 2022, whereas for mega deals as a whole (all those worth more than $5bn), the total fell 41 percent to $1.1trn as their number almost halved. It was a similar story in the mid-market ($1bn-5bn), where M&A deals dropped 44 percent  by value and 42 percent by number of deals.

There are few signs yet of the market reaching a floor, with declines accelerating into the final three months of the year, marking the slowest quarterly period since April-June 2020. Declines have been universal, with no region, deal-type or sector spared from large, double-digit declines during 2022.

One bright spot

The U.S .may just prove the exception. For the year-to-date, the US has led the retreat in M&A activity, with a 38 percent drop to $1.5trn, barely surpassing 2020, a year most dealmakers had hoped to forget. But there are tentative signs of a plateau or better, with Q4 transaction value recovering some 23 percent in the final three months of the year.

No such glimmers of hope are visible in Europe, which is 39 percent down on the year, to reach just $850.7bn and a three-year low. Here, the decline has accelerated, with Q4 deal value down 41 percent compared to the preceding three-month period. Europe is also home to the most withdrawn M&A, with 43 percent of failed deals involving a European target, its highest share since 2008.

Asia-Pacific is on a similar trajectory heading out of 2022 – the region’s M&A is 32 percent down on the year, to total $830.7bn and a two-year low.

Access our regional and global Quarterly Reviews in Refinitiv Workspace with the DealIntel app

Sponsors cautious, SPACs side-lined

Unlike in other volatile periods in recent years, special purpose vehicles and private equity investors failed to swing to the rescue.

Sponsor-backed M&A fell 36 percent in 2022, to $784.5bn albeit retaining a historical record of 22 percent of the M&A market. There was a notably marked fall in private equity activity in Asia, with sponsored buyouts down 54 percent to $123.1bn and a three year low. But world-wide, it is a testament to the frenetic activity of 2021 that after such a steep decline, 2022 will still stand as the second busiest year for private equity backed M&A on record.

Meanwhile, SPACs account for just 3 percent of deals in 2022, down from 10 percent a year ago.

Refinitiv Workspace: Experience a powerful, smart and customer-centric solution designed to inform the investment banking community at all times

A trio of mega-tech deals

Despite a 36 percent in technology related deals, the sector comprises a record 20 percent of the M&A market driven by a mega trio of deals: the $68.7bn mega merger of Microsoft and Activision Blizzard; the $68.3bn acquisition of VMware by Broadcom; and Elon Musk’s X Holding’s acquisition of Twitter for $40.3bn.


In other sectors, energy & power deals fell by a relatively modest 19 percent to represent 13 percent of the market, just ahead of the industrials sector at 12 percent. The financial sector was particularly hard hit, down 44 percent to reach just $390.7bn in 2022.

Our M&A due diligence reports cover traditional integrity red flags, emerging risks such as environmental, social, and governance (ESG) risks, operational and quality risks, financial risks, and identity risks. Find out more here.

Cross-border disproportionately affected

In a dismal market, cross-border deals were particularly hard hit, with a 46 percent drop in 2022 to $1.1trn. North American acquirers were responsible for 40 percent of worldwide M&A in 2022, totaling $450.8bn.

US acquirers alone accounted for a quarter of deals, while the UK accounted for 10 percent of activity. By contrast, China outbound acquisitions accounted for just 2 percent of cross-border activity. Even so, China remains the top emerging markets acquirer, with India a distant second.

Investment banking fees have broadly tracked market activity, down 33 percent from last year’s record-breaking high to bring in $110.5bn.

The biggest losers were equity capital market, which saw fees drop 66 percent year-to-date. With the exception of CITIC, all top ten fee earning banks saw a double-digit percentage declines relative to 2021, and one bank saw earnings more than halve.

Access our Deals Intelligence insights

Access up-to-the-minute market intelligence through a variety of research reports, weekly investment banking scorecards, deals snapshots, and our industry-leading quarterly reviews, highlighting trends in M&A and capital markets


How has M&A performed in 2022?

After the boom year of 2021, world-wide M&A deal-making has hit reverse, with the second half of 2022 down 33 percent