M&A Deal Activity Trends Post-Pandemic

M&A Activity Surges Amid Policy Tailwinds and Economic Resilience: M&A activity is roaring back to life, fueled by a potent combination of resilient global growth, falling interest rates, deregulation, and greater clarity around tariffs and geopolitical risks. This new macro and policy backdrop has unleashed a fresh wave of corporate confidence, empowering CEOs and Boards to pursue bold, strategic combinations. Financing costs have declined meaningfully, with loan rates down 50 basis points in the U.S. and over 100 basis points in Europe in 2025, sharpening the math for LBOs. Meanwhile, deregulation has reduced political friction, increased certainty of regulatory approval, and accelerated deal timelines. In parallel, tariffs, once a cloud over global dealmaking, are now priced into when evaluating cross-border transactions for exporters and importers. Spin-offs are also on the rise as companies sharpen their strategic focus. U.S. spin-off volume doubled in Q2 2025, as firms seek to unlock value and shed non-core assets. The environment is now one of action, after a long period of hesitation. This resurgence comes at a critical juncture for Private Equity. With ~30,000 sponsor-owned portfolio companies globally, the industry has faced mounting exit pressure, especially for 2016–2021 vintage funds, which have reported ~20% lower DPI relative to prior funds. We are seeing green shoots with M&A up 20% and bankers on pace for their best year since 2021: IPOs, sponsor-to-sponsor deals, M&A exits, and dividend recaps are all re-accelerating. For credit investors, this is equally constructive, since ~50% of LBO capital structures are funded with debt, higher deal velocity directly supports origination pipelines. Sectors like technology, defense, energy, healthcare, transportation and business services are leading the rebound, offering rich pipelines for both equity and debt capital providers. Union Pacific-Norfolk Southern, Baker Hughes -> Chart Industries, Charter -> Cox, Alphabet -> Wiz are setting the tone, with significantly more to come as this momentum is highly likely to continue. Could it be that the best is yet to come?

"M&A dealmakers have been on a wild ride." First it was the pandemic. Then a record-breaking recovery in 2021. Then a steep YOY 16% decline in 2023, when the number and value of global deals fell to their lowest levels in 10 years. Yet many are approaching 2024 with optimism. McKinsey & Company highlights why: - The M&A market is durable: With all the change in the business landscape—AI, sustainability, more demanding consumers—CEO’s say that M&A is more important than ever as a lever for growth. - Experience predicts success: Companies making >2 small to midsized acquisitions a year between 2012-2022 delivered total shareholder return that outperformed all other M&A strategies and organic growth, partly because they were actively reshaping their portfolios, divesting as well as acquiring. Making more deals tended to outperform making fewer. - Private equity coming back? PE drove a lot of global M&A in the past, but cut its activity 37% to $560B and only accounted for 18% of deal activity in 2023, due to the high cost of capital, central bank uncertainty, and greater regulator scrutiny. The expectation is that activity will pick up as some funds need to exit and redeploy, and dealmakers will be attracted by the $2T in undeployed capital at the end of 2023.  - Strong economies: Despite uncertainty around geopolitical stability, dealmakers are generally feeling positive about their countries’ economies and where they're headed over the next six months. Inflation is now just over 3% in the US, Europe and Asia. US unemployment was <4% at the end of 2023. Consumer spending globally is robust. - Areas of opportunity: The Americas, which remains the most active M&A market (> 50% of global activity in 2023), saw deal value fall 7% to $1.6T but that was only slightly lower than the $1.7T of pandemic year 2020. Average deal size increased 38%, and 11 of the world’s 20 biggest deals in 2023 came from the region. In EAME, the value of M&A fell 30% to $721B in 2023, and APAC deal value dropped 19% to the lowest levels in 10 years.  India and Japan, with relatively low geopolitical risk, saw an uptick in deal inflow, and overall APAC continues to account for ~25% of global deal value, up from 15% in 2004, and is expected to continue growing. - Fourth quarter saw growth: The value of global M&A activity grew 41% vs. Q3, and 37% YOY; the number of deals increase 7% quarter-on-quarter, and average deal size was up 32%. - Active industries: Global Energy and Materials accounted for the largest share (26%) of activity in 2023 after a long run of Technology/Media/Telecom deals, which fell from 25% in 2020 to 17% in 2023. Deals in Healthcare (14%), Financial Services (11%), Advanced Industries (9%), Consumer/Retail (8%), Real Estate (8%), and Travel/Logistics/Infrastructure (4%) followed. Nearly five months in, how are you feeling about M&A in 2024? #mergersandacquisitions #deals #recovery #optimism #performance #growth #portfolio #acquisitions

Mergers and acquisitions in the financial-services sector staged a notable comeback in 2024, rebounding by 30 percent from the previous year. While dealmaking accelerated, most transactions remained within national borders, suggesting that regulatory hurdles and geopolitical pressures continued to weigh on cross-border ambitions. Many investors pursued scale and capability acquisitions, particularly in fields like capital markets, wealth and asset management, and fintech. These areas together made up two-thirds of the total transaction value, a rise from less than half just a few years ago. Traditional banking acquisitions declined from nearly half of total deal value down to less than a third, reflecting lingering worries about loan portfolios, rising capital requirements, and the specter of more stringent regulations. Meanwhile, private equity, buoyed by over two trillion dollars in available capital, targeted technology and data-driven businesses that promise swift returns without heavy balance-sheet risk. In regional terms, Europe showed signs of embracing cross-border consolidation to create internationally competitive banks, whereas the United States edged closer to reducing the fragmentation of its 4,000-plus financial institutions. In the Middle East, healthy local deals continued at a brisk pace, aided by growth in Islamic finance, and Asia remained conservative, focusing more on digital readiness than on large-scale M&A plays. Heading into 2025, dealmakers in commercial and retail banking may pursue consolidation at home, yet also keep an eye on potential policy shifts that might reignite cross-border expansions. Struggling fintechs, squeezed by tougher funding conditions, could be prime acquisition targets for stronger fintech or incumbent players seeking differentiated capabilities. In payments, which has already undergone significant merger activity, further tie-ups may be smaller and more focused on niche competencies. While caution defines the immediate environment, a steady easing of economic and regulatory hurdles could prompt larger, more transformative deals to reemerge, setting the stage for a new wave of global expansion in financial services.

📈 𝐃𝐞𝐚𝐥𝐒𝐜𝐚𝐩𝐞 | 𝘐𝘯𝘤𝘳𝘦𝘢𝘴𝘦𝘥 𝘔&𝘈 𝘈𝘤𝘵𝘪𝘷𝘪𝘵𝘺 {𝘸𝘪𝘵𝘩 𝘳𝘦𝘭𝘦𝘷𝘢𝘯𝘤𝘦 𝘧𝘰𝘳 𝘦𝘮𝘦𝘳𝘨𝘪𝘯𝘨 𝘤𝘰𝘮𝘱𝘢𝘯𝘪𝘦𝘴} Disclosed startup M&A exceeded $100 billion in the first half of 2025, a 155% increase over the same period last year (Crunchbase). While a portion of that came from large-cap transactions such as Google’s $32 billion acquisition of Wiz, the broader trend is more important: 𝘚𝘵𝘳𝘢𝘵𝘦𝘨𝘪𝘤 𝘢𝘯𝘥 𝘧𝘪𝘯𝘢𝘯𝘤𝘪𝘢𝘭 𝘣𝘶𝘺𝘦𝘳𝘴 𝘢𝘳𝘦 𝘳𝘦-𝘦𝘯𝘨𝘢𝘨𝘪𝘯𝘨, 𝘢𝘯𝘥 𝘢𝘤𝘵𝘪𝘷𝘪𝘵𝘺 𝘪𝘴 𝘱𝘪𝘤𝘬𝘪𝘯𝘨 𝘶𝘱 𝘢𝘤𝘳𝘰𝘴𝘴 𝘴𝘦𝘤𝘵𝘰𝘳𝘴. ⟡ The market is open to smaller, targeted acquisitions. The majority of transactions involve growth-stage companies with strategic positioning rather than scale. Examples include Stripe’s acquisition of crypto wallet startup Privy and Zscaler’s pickup of Red Canary. These transactions were not billion-dollar outcomes, but they created strong alignment between acquirer and target. ⟡ Outcomes are being driven by fundamentals, not hype. Even in sectors like AI, many buyers are focused on core technology fit, talent, or distribution leverage. This rewards founders who have invested in real product traction, even if revenue is still early. ⟡ 𝘏𝘦𝘢𝘭𝘵𝘩𝘤𝘢𝘳𝘦 𝘤𝘰𝘯𝘵𝘪𝘯𝘶𝘦𝘴 𝘵𝘰 𝘴𝘦𝘦 𝘮𝘦𝘢𝘯𝘪𝘯𝘨𝘧𝘶𝘭 𝘪𝘯𝘵𝘦𝘳𝘦𝘴𝘵. One of the largest transactions of the year was Modernizing Medicine’s $5.3 billion recapitalization with Clearlake Capital. Buyers remain active in vertical software, clinical decision tools, and services tied to efficiency and reimbursement. → For many companies, M&A is becoming the next round. Four years after the 2021 funding peak, many venture-backed companies are now weighing strategic outcomes more seriously. Continued fundraising remains an option, but M&A has re-emerged as a credible and, in some cases, preferable path. ⁘ 𝘗𝘦𝘳𝘴𝘱𝘦𝘤𝘵𝘪𝘷𝘦: For emerging growth companies, the return of M&A provides an opportunity to align with the right strategic partner before market conditions shift again. These transactions do not require billion-dollar scale. A compelling narrative, focused execution, and thoughtful positioning can drive strong outcomes, even in the $25 to $150 million range. ❯ If you are thinking about capital strategy or starting to evaluate options, I would be glad to have a conversation. #MergersAndAcquisitions #StartupExit #StrategicCapital #HealthcareInnovation #VentureCapital #SierraPacificPartners

2025 was the most active year on record for SaaS M&A. 2,698 deals closed in 2025 vs 2,107 in 2024... that's a 28% jump and over 500 more transactions than both 2024 and 2022. December alone saw 196 deals, up 58% from December 2024. What's driving this: Buyers are aggressively pursuing AI-enabled platforms that sit at the core of enterprise operations – data infrastructure, security, and workflow automation. The mega-deals tell the story: > IBM → Confluent: $11.1B (10.0x revenue) > ServiceNow → Armis: $7.75B (22.8x revenue) > ServiceNow → Veza: 40.0x revenue > Marvell → Celestial AI: $3.48B But it's not just the big deals. Activity is distributed across all sizes. We're seeing consistent demand from $20M acquisitions all the way up to multi-billion dollar platforms. The leading categories: > Analytics & Data Management (18% of December deals) > Content & Workflow Management (17%) > Business Management (11%). Here's what matters if you're a founder: The market is rewarding quality and differentiation. Public SaaS saw a 33.3% gap between top and bottom quartile performers in 2025 (upper quartile +5.9%, lower quartile -27.4%). If you're building mission-critical software that enterprises depend on daily – especially if it touches data, security, or AI-enabled workflows – buyers are paying attention. The setup heading into 2026 looks strong. Corporate earnings remain solid, and there's underlying demand that hasn't fully translated to valuations yet. For founders thinking about timing: 2026 could be an exceptional window. Source: SEG SaaS Index - [Monthly Insights] December's SaaS Trends and Deals

The cross-border M&A market in Asia is in a state of resurgent but cautious optimism, as of March 2026. After a good recovery in late 2025, the market is characterized by a "Singapore +1" strategy for Chinese firms, a surge in outbound capital, and a focus on energy and AI infrastructure. Aggressive capital export: Asia-Pacific has emerged as a major capital exporter, with $385bn in outbound deployment compared to $280bn inbound as of early 2026. Outbound growth: BDA Partners projects Asian outbound activity to increase by 25% in 2026, driven by sovereign wealth funds and big corporates seeking stable returns in developed markets. "Singapore +1" strategy: Chinese enterprises are increasingly using Singapore as their primary regional HQ and investment platform, to then expand into Indonesia, Vietnam, and Thailand. Dealmaking is concentrated in: Energy transition: Renewables (offshore wind, solar), battery storage, and critical minerals like lithium and nickel. Digital infrastructure: Massive investment in data centers and AI-scale compute power, with capacity in the region expected to rival the US within a decade. Healthcare & wealth management: Driven by aging populations and a rising high-net-worth demographic in the region. * Mainland China - seeing a rebound in investor confidence; M&A value rose 45% in the preceding year as regulatory predictability improved. * Japan - remains a top source of deal flow due to corporate governance reforms; inbound M&A hit record highs in 2025. * India - sustained high activity levels in tech and renewables, with a 73% increase in deal value over 2024-2025. * SE Asia - increasingly a manufacturing hub for firms diversifying away from China; high interest in semiconductors and electric vehicle (EV) supply chains. Regulatory hurdles: national security reviews (CFIUS in the US or FIRB in Australia) are intensifying, with mandatory declaration rates for tech deals reaching 85%. Risk mitigation: significant rise in the use of Warranty and Indemnity (W&I) insurance to protect deals against geopolitical volatility. Minority stakes: to avoid strict regulatory triggers, more buyers are opting for minority equity interests, JVs or staged deals rather than full acquisitions. 

📊 “With Intelligence” Recently Dropped Their Q3 2025 PE Report - Here’s What the Numbers Say About the Market Right Now “With Intelligence” recently released their 'Q3 2025 Private Equity Deal Activity Trends' report, published in July 2025 and tracking closed deal volume through June 30, 2025. It’s one of the freshest looks we have at mid-year private markets activity, and it paints a clear picture of how this cycle is maturing. According to the report, private equity still dominates North American M&A, accounting for 53% of all transactions in 1H 2025. But total volume has cooled, pacing at 49% of 2024’s full-year total, with Q2 showing a 13% drop from Q1 and a 17% decline year-over-year. Even so, there’s resilience beneath the surface: Q2 2025 still notched a 10% rebound in deal flow versus Q1, showing that dry powder hasn’t disappeared, it’s just being deployed more selectively. Sector trends tell a similar story. Technology, Financial Services, and Utilities were the only sectors posting year-over-year growth, while Industrials, Business Services, and Consumer led in raw deal count. The standout stat: PE firms executed an average of 2.7 add-ons per platform, up from a multi-year average of 2.4. This appears to be clear evidence that consolidation and scale remain the name of the game. Deal conversion rates are finally moving in the right direction too. After several quarters of decline, 27% of deals sourced in Q2 2024 have now closed, signaling healthier follow-through in a market that had been stuck in due-diligence limbo. 💡 The bigger takeaway? 👉 Dealmaking in 2025 isn’t about chasing volume, it’s about conviction. More firms are prioritizing strategic fit, scalability, and proprietary sourcing over broad outreach. As financing costs stay elevated and diligence standards rise, the winning playbook is shifting from seeing more to seeing smarter. If this mid-year snapshot is any indication, private equity may be entering a new phase - disciplined, data-driven, and quietly setting up for the next expansion.

M&A is booming again. So what's new and what's changed from the last peak in 2021? Having been involved in dozens of M&A transactions as both buyer and seller in the public and private markets, here are my thoughts on the below chart (source: The Information). What's Changed: 1. 𝐂𝐨𝐫𝐞 𝐓𝐡𝐞𝐬𝐢𝐬 - Much of the current M&A is related to legacy companies shifting to become AI companies. Pivots are incredibly hard to do at scale (having been a finance exec at Adobe, I saw this firsthand), so M&A is the fastest way to shift into the AI era. Similarly, in the 2010s, much of the M&A activity was driven by legacy on-premise companies shifting to the cloud (i.e., Oracle / NetSuite). 2. 𝐂𝐫𝐞𝐚𝐭𝐢𝐯𝐞 𝐃𝐞𝐚𝐥 𝐒𝐭𝐫𝐮𝐜𝐭𝐮𝐫𝐞𝐬 - Acquiring companies for talent used to be the smallest type of acquisition (called acqui-hires). Now we're seeing creative deal structures into the billions for talent alone. Top AI talent can materially impact outcomes in the current arms race, and that's reflected in the price. 3. 𝐈𝐧𝐭𝐞𝐫𝐞𝐬𝐭 𝐑𝐚𝐭𝐞𝐬 - In 2021 the fed funds rate was essentially zero, in contrast to ~4% for most of this year. When we were acquired in 2021 by Bill.com, they had recently raised a zero-coupon convertible bond to fund M&A. Debt isn't as attractive in the current market, so strong public company share prices and cash flow from operations are the main drivers. What's the Same: 1. 𝐁𝐮𝐲𝐢𝐧𝐠 𝐆𝐫𝐨𝐰𝐭𝐡 - There's a material valuation divergence in the public markets right now for high-growth vs. low-growth tech companies. This is historically consistent. When we were being acquired in 2021 for $625M, one of my main slides for the board presentation was an Enterprise Value / Revenue vs. Growth Rate regression chart for our acquirer vs. their peers, since the deal currency was 75% equity. Tech acquirers are consistently buying growth to move up and to the right on this regression line. 2. 𝐒𝐭𝐫𝐞𝐧𝐠𝐭𝐡 𝐢𝐧 𝐏𝐮𝐛𝐥𝐢𝐜 𝐌𝐚𝐫𝐤𝐞𝐭𝐬 → 𝐒𝐭𝐫𝐞𝐧𝐠𝐭𝐡 𝐢𝐧 𝐌&𝐀 - We consistently see that deal volume and prices go up when there is enthusiasm in the public markets. Will Campfire be on the M&A charts anytime soon? Only as the acquirer. Every time I meet with reporters (including two last week) to discuss Campfire, they ask if I'm open to being acquired. We receive plenty of acquisition interest, but there is zero appetite. We have a lot of work to do, but I'm incredibly focused on building a long-term, durable company that will enter the public markets.

When I talk with people in M&A who focus exclusively on AV, the message is clear... Deal activity is BOOMING. This is part of a larger wave of consolidation that’s reshaping the industry. 2025 has already seen major moves, and multiple new announcements are set to hit before year-end. All signs point to 2026 being even stronger. Private equity is fueling much of the momentum, backing both large platform acquisitions and steady add-on deals. At the same time, the convergence of AV and IT is driving strategic investments in unified communications, remote management, AI integration, and full-scale enterprise solutions. Scale and technology are now the winning formula. Global integrators are expanding aggressively, while service-led business models with recurring revenue are commanding premium valuations. With the pro AV market forecast to grow steadily through 2030, consolidation is now inevitable and accelerating. I’ve seen this evolution firsthand. When Atlantis Partners entered the New York subcontracted AV market, there was virtually no competition. With our recent Atlantis–UGS merger, we’ve doubled down on scale and capability, and can now deliver on projects that might have been impossible before. 2026 will be a defining year, and the boom is only just beginning.

The strategic M&A rebound continues Strategic M&A is closely watched as a barometer of C-suite confidence. Data tracked by Dealogic shows an acceleration of activity in recent months – above and beyond the elevated volumes we highlighted in March and June of this year, when we pushed against the prevailing market narrative that aggregate deal-making was muted. So far in 3Q2025, companies based in North America have already announced $240 billion worth of strategic acquisitions (as of August 5th) – making the quarter the most active since 3Q2021, with seven weeks more to go. And year-to-date volumes are now running at the most active pace since 2021 – which ultimately proved to be a record year (Exhibit 1). Beyond the aggregate strategic M&A volumes across regions, our analysis of the granular deal-level data for 2025 (YTD) reveals four key themes: (1) Large-cap ‘mega’ deals are back, (2) M&A is being used to build and add capabilities, and divestments are being used to refine focus, (3) sector ‘leadership’ has shifted so far in 2025, and (4) the financing mix is somewhat unfriendly for bondholders. #MergersAndAcquisitions #Strategic #USD #EUR #FundingMix #CorporateCredit Please see here for more: https://1blk.co/4frYeDe FOR INSTITUTIONAL INVESTORS ONLY