Global M&A Falls Below $1 Trillion in Q3 as Higher Borrowing Costs Cool Deal Rush
Global merger and acquisition activity lost steam in the third quarter, with deal values sliding 41% from the second quarter to $993 billion, according to LSEG data reported by Reuters on October 1. It is the first quarter below the $1 trillion mark since the second quarter of 2025.
The slowdown comes as surging energy costs feed inflation worries and lift expectations for where interest rates will settle. The benchmark 10-year US Treasury yield hit 5.34% on Thursday, its highest level since 2002, after recording its biggest quarterly rise this century in the three months to September, Reuters reported.
Megadeals dry up
Just 10 deals worth more than $10 billion were announced in the quarter, the lowest count of such megadeals since the fourth quarter of 2024. Among them were Banca Monte dei Paschi's $32 billion bid for Banco BPM and Gold Fields' $25.7 billion bid for Northern Star Resources.
"At the margins [higher yields] makes valuations sometimes a little tougher," said John Collins, global head of M&A at Morgan Stanley, adding that he was not yet ready to call it a slowdown. Clifford Chance's global head of corporate, Sarah Jones, described the quarter as "a normalization rather than an end of a cycle" after what she called an extraordinary second quarter.
Year-to-date still strong
Despite the third-quarter pullback, the full year remains on a record pace: worldwide M&A is up 28% so far this year to $3.9 trillion, the highest level for the period since 2001, even as the number of deals fell 8% to levels last seen in 2020. It is also the strongest year to date on record for private equity-backed dealmaking by value since records began in 1980.
Asia Pacific bucked the trend: regional M&A totalled $242 billion, up 8% from the second quarter and 36% higher than a year earlier. Cross-border dealmaking is up 32% year to date, with US companies eyeing acquisitions in Europe and capital flowing the other way too, said JPMorgan's global head of M&A, Charlie Bouckaert. Technology investment also continues to prop up activity, with strategic stake purchases in tech companies accounting for roughly a quarter of global M&A this year.
Sources: Global M&A deal rush fades in third quarter as rising borrowing costs bite, Global M&A deal rush fades in third quarter | The Manila Times
Global merger and acquisition activity lost steam in the third quarter, with deal values sliding 41% from the second quarter to $993 billion, according to LSEG data reported by Reuters on October 1. It is the first quarter below the $1 trillion mark since the second quarter of 2025.
The slowdown comes as surging energy costs feed inflation worries and lift expectations for where interest rates will settle. The benchmark 10-year US Treasury yield hit 5.34% on Thursday, its highest level since 2002, after recording its biggest quarterly rise this century in the three months to September, Reuters reported.
Megadeals dry up
Just 10 deals worth more than $10 billion were announced in the quarter, the lowest count of such megadeals since the fourth quarter of 2024. Among them were Banca Monte dei Paschi's $32 billion bid for Banco BPM and Gold Fields' $25.7 billion bid for Northern Star Resources.
"At the margins [higher yields] makes valuations sometimes a little tougher," said John Collins, global head of M&A at Morgan Stanley, adding that he was not yet ready to call it a slowdown. Clifford Chance's global head of corporate, Sarah Jones, described the quarter as "a normalization rather than an end of a cycle" after what she called an extraordinary second quarter.
Year-to-date still strong
Despite the third-quarter pullback, the full year remains on a record pace: worldwide M&A is up 28% so far this year to $3.9 trillion, the highest level for the period since 2001, even as the number of deals fell 8% to levels last seen in 2020. It is also the strongest year to date on record for private equity-backed dealmaking by value since records began in 1980.
Asia Pacific bucked the trend: regional M&A totalled $242 billion, up 8% from the second quarter and 36% higher than a year earlier. Cross-border dealmaking is up 32% year to date, with US companies eyeing acquisitions in Europe and capital flowing the other way too, said JPMorgan's global head of M&A, Charlie Bouckaert. Technology investment also continues to prop up activity, with strategic stake purchases in tech companies accounting for roughly a quarter of global M&A this year.
Sources: Global M&A deal rush fades in third quarter as rising borrowing costs bite, Global M&A deal rush fades in third quarter | The Manila Times
