Global M&A Volumes Surpass Record Highs - Refinitiv
(16 August 2021 – Global) Merger and acquisition (M&A) activity has reached fresh record highs, expanding on the surge in H1 2021 dealmaking driven by sustained dovish monetary policy holding interest rates down and bullish equity markets.
The total value of pending and completed deals announced in 2021 has already reached US$3.6 trillion year-to-date (YTD), surpassing the full-year value of US$3.59 trillion in 2020. 35,128 deals have been announced YTD, marking a 24 percent increase over the entirety of 2020.
After hoarding record cash reserves, resurgent deal flow by major buyout firms and corporates is expected to further underpin M&A volumes through H2 2021.
The latest data from Refinitiv revealed that sectors which are still struggling from the pandemic, such as consumer retail and travel firms, have lagged other acquisitive sectors such as technology and healthcare on M&A activity in 2021. The renewable energy sector has amassed US$18 billion worth of deals YTD, more than twice the M&A volume that was generated in 2020.
Bank of America is one of the standout investment banking winners from the increase in M&A activity, closing the gap rapidly to key rival JPMorgan especially in Asia as a three-year rebuild of the business with a focus on winning big deals starts paying off. M&A activity in Asia in particular is expected to remain strong through H2 2021.
"The M&A momentum points to a fundamentally strong market looking ahead. This pace of dealmaking could continue for the next 18-24 months, with new financing solutions and sectors driving activity. The strong demand from private equity and the rebound in SPAC acquisitions should support a robust deal pipeline in the near to mid-term” stated EY Global Vice Chair, Andrea Guerzoni.
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