After the highly volatile year of 2020, the global mergers and acquisitions (M&A) market has reached record levels in the year 2021. The combination of readily available capital due to low-interest rates and strong company balance sheets along with pent-up demand from early 2020, where COVID-19 slowed down the industry, has resulted in the global M&A market volume passing 5.5 trillion USD at the end of 2021.

Complete M&A deal volumes in the US reached 2.61 trillion USD, nearly doubling from 2020. Europe saw an increase of 47% in M&A deal volume to 1.12 trillion USD, according to Dealogic.

As of October 2021, the technology sector was the largest industry in M&A deals, accounting for 27% of global deal value, the largest share for the area ever. According to a survey by Mergermarket, which surveyed 300 M&A dealmakers, the most significant individual key driver of M&A activity was management and investors pursuing digital transformation for their business. The high demand for technology businesses is likely to continue in 2022.

ESG considerations also remain an increasingly important topic in M&A, driven by increased scrutiny from investors, regulators, and governments, as well as the growing public awareness of the issues. ESG-related scrutiny in deals is expected to continue to increase, especially in the EMEA and the US in the upcoming years, according to the interviewed M&A dealmakers.

If you’re considering buying or selling your company, now might be the perfect time to start the process. See our M&A Advisory Services for more details on how we can help you.

Olli

Sources:
M&A Highlights: First 9 Months 2021
Reuters: Global M&A activity smashes all-time records to top $5 trillion in 2021