The 2021 deal-making story is above and to the right.
The news is driving: Global M&A activity will break all records in the first three quarters of 2021, according to preliminary data from Refinitiv.
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According to the numbers: Transaction volume topped $ 4.3 trillion, nearly double what it was in 2020 so far. It’s also 34.4% higher than 2007, which was the previous record holder and one of just two years that ended September 3 Trillion US dollars have been exceeded.
The 2021 data includes $ 1.52 trillion for the third quarter, which is also an all-timer. Not just for a third quarter, but for every quarter.
The third quarter also reflected higher average deal sizes, or at least higher disclosed deal sizes, as the number of deals was hundreds below the previous four quarters.
Geographically, the volume of transactions in Europe doubled for the third quarter of 2020, while the US grew 32% and the Asia-Pacific region increased 21%. US volume represented 44.9% of global M&A since the start of the year and 36.9% in the third quarter.
Tech continued to lead all other industrial sectors with a market share of 20.7% (YTD), followed by financials (12%), industrials (11.3%) and energy (10%).
What’s happening? Animal spirits.
What is the fear? Did you miss the hint about 2007?
The bottom line: This isn’t just a deal-making boom. It’s a deal-making boom in the context of a global pandemic and expectations of tax and interest rate hikes. Yes, cycles will prevail again at some point. But right now the economical Teflon is unprecedented.
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