The global volume of large deals fell sharply in Q1

• Record decline in the number of completed mergers and acquisitions worldwide in the first quarter of 2024, despite an uptick in announced deals.

• Deal activity worth more than 100 million dollars fell eight percent in volume compared to the same period in 2023, resulting in the lowest first quarter figures since 2010.

• M&A performance was below par in several regions, particularly in North America, where buyers underperformed the regional index for the fifth consecutive quarter, and in Europe, where dealmakers have not outperformed their regional index since 2021.

Despite an upturn in announced deals, the number of completed mergers and acquisitions worldwide will again show a record decline in the first quarter of 2024.

Dealmakers also faced numerous challenges in executing transactions in the first quarter, according to research on completed deals from WTW’s Quarterly Deal Performance Monitor (QDPM).

Compared to the strong performance of global equity markets, companies completing mergers and acquisitions lagged the market with a decline of 14.8 percentage points between January and March 2024 for acquisitions valued at more than 100 million dollars, based on the development of share prices.

This is a continuation of the negative performance of the previous quarter (-13.6pp). Despite these latest results, the long-term trend of over fifteen years still shows that deals have outperformed the market since the global financial crisis (+1.5pp).

Despite the decline, there are clear signals for a revival of the M&A market
The data, collected in collaboration with The Bayes Business School’s M&A Research Center, shows that deal activity worth more than 100 million dollars continued to decline globally in the first half of 2024; with 138 deals completed compared to 150 in the same period in 2023. This represents an eight percent decline in volume and the lowest first quarter figures since 2010.

The volume of large deals (worth more than 1 billion dollars) also fell in the first three months of this year, continuing the steady decline that started in 2021. Thirty deals were completed compared to 35 in the same period last year. In the first quarter of 2024, four mega deals (worth more than ten billion dollars) were closed, compared to only one in the first quarter of 2023.

Jana Mercereau, Head of Corporate M&A Consulting at WTW, said: “In 2023, the global M&A market has endured an exceptionally difficult year for acquisitions. While inflation concerns have subsided, persistent challenges such as weak global economic growth, geopolitical instability and uncertainty surrounding the US presidential elections will have a limiting effect on deal making.”

“At the same time, recession fears are receding, shifting the consensus towards a soft landing, and forecasts for a rebound in mergers and acquisitions are supported by the recent sharp increase in IPO activity. With trillions of dollars of capital lying around, private equity firms are also under increasing pressure to deploy their committed capital. While our research tracks completed mergers and acquisitions, the marked increase in the number of announced deals in late 2023 and early 2024 suggests that the coming year will become busier as they come to fruition.”

Read also: 10 major insights from the Deloitte Belgian M&A Predictions 2024