M&A bankers experience increase in deals without positive feelings

Global mergers and acquisitions (M&A) have been on the rise in recent years, with the proportion of M&A to worldwide equity market capitalization steadily increasing. A line chart depicting M&A as a percentage of global equity market capitalization from Year-To-Date (YTD) 2009 to YTD 2025 shows a clear upward trend. This growth indicates a significant shift in the global business landscape, with more companies engaging in M&A activities to drive growth, expand market share, and increase competitiveness.

The chart illustrates that in the years following the global financial crisis of 2008, there was a slight dip in the proportion of M&A activity compared to equity market capitalization. However, since then, there has been a steady climb, with M&A activity outpacing the growth of equity market capitalization. This trend suggests that companies are increasingly turning to M&A as a strategic tool to navigate challenges, capitalize on opportunities, and achieve sustainable growth in a rapidly evolving business environment.

One of the key drivers behind the surge in M&A activity is the desire for companies to gain a competitive edge in their respective industries. By acquiring complementary businesses, companies can access new markets, technologies, and talent, allowing them to strengthen their market position and drive innovation. Additionally, M&A can offer cost-saving opportunities through synergies and economies of scale, enabling companies to improve efficiency and profitability.

Another factor contributing to the uptick in M&A activity is the availability of cheap financing. Low-interest rates and ample liquidity in the global financial markets have made it easier for companies to fund acquisitions, making M&A an attractive growth strategy. Furthermore, in a fast-paced and increasingly digital world, companies are under pressure to adapt quickly to changing consumer preferences and technological advancements. M&A provides a strategic avenue for companies to stay ahead of the curve and remain relevant in a competitive marketplace.

The chart also highlights the cyclical nature of M&A activity, with periods of peak activity followed by downturns. These fluctuations are often driven by external factors such as economic conditions, regulatory changes, and geopolitical events. Despite the inherent risks and complexities associated with M&A transactions, companies continue to pursue deals in search of growth opportunities and value creation.

In conclusion, the increasing proportion of M&A to worldwide equity market capitalization signals a growing trend of companies using M&A as a strategic tool for growth and competitiveness. As companies navigate an ever-changing business landscape, M&A offers a pathway to expansion, innovation, and sustainable success. By leveraging the power of M&A, companies can position themselves for long-term growth and resilience in an increasingly dynamic global economy.