INTRODUCTION Contributed by: Frank Aquila, Sullivan & Cromwell LLP
Corporate M&A: An Introduction After a decade-low year of deal making in 2023, M&A activity experienced a modest bounce- back in 2024, nearly rebounding to pre-pandem - ic levels of activity based on deal value. Despite these gradual increases, 2024 was nevertheless characterised by uncertainty in the market in the shadow of the 2024 US presidential election, strict governmental regulations and enforce - ment, and broad regulatory changes. As we look forward to 2025, there is optimism that M&A activity will continue to pick up steam. Factors supporting a resurgence for M&A include relaxed antitrust regulation, improved market conditions, pent-up private equity demand and unprecedented levels of dry powder for private equity to deploy. However, there are a number of countervailing factors that may prove to sup - press this atmosphere, including unpredictable cross-border regulatory enforcement, uncertain - ty amidst trade wars and the imposition of new tariffs, and geopolitical tensions. Preliminary data for M&A in January 2025 shows a significantly slower start than many had hoped or anticipated, with USD211.5 billion in announced deals, a 7% decrease compared to one year prior, and a 28% decrease compared to the previous month, December 2024. Based on total M&A deal volume, 2025 has had the fewest deals and the slowest start to a year since 2015. However, there is still hope that this slow start will not be the norm, and that momentum will continue to build throughout the year. M&A activity trends in 2024 Approximately USD3.2 trillion in deals were announced in 2024, representing a 10% increase from 2023, although an 11% decrease from 2022 and a 46% decrease from 2021, as measured by the value of announced deals. Despite the
year-over-year increase in deal value, the total volume of M&A deals reached an eight-year low, with 50,200 deals announced in 2024, reflecting a 14% decrease compared to 2023. This discrepancy can largely be attributed to the number of mega-deals in 2024, with 96 deals over USD5 billion buoying the global M&A mar - ket and accounting for USD1.1 trillion in total deal value. This represented an increase of 17% in mega-deals compared to 2023 levels, marking the strongest full year period for mega-deals, by value, since 2022. By contrast, the value of worldwide M&A below USD500 million totalled USD794.8 billion during 2024, which was a 4% decrease by value and a 17% decrease by number of deals, compared to 2023 levels. Among the M&A activity in 2024, most transac - tions were centralised within the top five indus - tries: • technology; • energy and power; • financials; • industrials; and • materials. In contrast to 2023, however, technology sup - planted energy and power as the industry with the highest transaction value. Deal making in the technology sector totalled USD499 billion during 2024, an increase of 32% compared to 2023 levels and accounting for 16% of overall M&A deal value. Technology also led the way in terms of total deals, with more than 10,000 deals announced. Energy and power, the 2023 leading industry, accounted for 15% of 2024 deal value activity, down 7% compared to 2023, and was only responsible for 3,400 deals.
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