LONDON/NEW YORK — Global merger and acquisition (M&A) activities in the third quarter (Q3) totaled $993 billion, down 41 percent compared to the prior quarter, marking the first quarter to fall below $1 trillion since the second quarter of 2025, according to LSEG data.
Banca Monte dei Paschi’s $32-billion bid for Banco BPM and Gold Fields’ $25.7-billion bid for Northern Star Resources were among the 10 deals over $10 billion announced in the third quarter, the lowest number of quarterly megadeals since the fourth quarter of 2024.
While the boom in artificial intelligence and data center building has lifted the outlook for economic growth, surging energy costs have been fanning inflation and pushing expectations higher about where interest rates will settle.
The benchmark 10-year United States Treasury yield hit 5.34 percent on Thursday, its highest level since 2002, after posting the biggest quarterly rise this century in the three months to September.
“At the margins [higher yields] makes valuations sometimes a little tougher,” said John Collins, global head of M&A at Morgan Stanley. “That said, the impact is hard to quantify, so I’m not ready to call a slowdown based on what we are seeing.”
So far this year, worldwide M&A is up 28 percent to $3.9 trillion, the highest level in the period since 2001, while the number of deals fell 8 percent, levels not seen since 2020.
“Corporates are still looking for scale or access to markets and technologies they are not in,” said Carsten Woehrn, Goldman Sachs’ co-head of M&A in Europe, Middle East and Africa.
He sees total deal value exceeding the 2021 peak if the pace continues.
“Megadeals are continuing and we’ve seen significant activity since the summer,” Woehrn said. “Boards feel a greater urgency to pull the trigger on strategic deals.”
Historic levels of investment in the technology sector have bolstered deals, with strategic stake purchases in those companies accounting for about one quarter of global M&A so far this year. Earlier this year, both Claude maker Anthropic and ChatGPT maker OpenAI raised tens of billions of dollars from investors.
While US and European dealmaking fell sharply in the last three months, Asia Pacific M&A totaled $242 billion, up 8 percent from the second quarter and up 36 percent from the same period last year.
This has been the strongest year to date for global private equity-backed dealmaking by value since records began in 1980, but the third quarter also saw a slowdown versus the same period last year.
“We had an extraordinary Q2. Q3 is a normalization rather than an end of a cycle,” said Sarah Jones, global head of corporate at law firm Clifford Chance. “Strategics are still working to pursue their goals.”
Cross-border dealmaking remains a strong theme this year to date, up 32 percent on the same period last year.
“We’re seeing a fair amount of appetite from US companies thinking about acquisitions in Europe for the first time, taking advantage of a strong dollar. In reverse, you’re seeing people considering investment in the US to take advantage of the potentially higher growth opportunity in the country,” said Charlie Bouckaert, JP Morgan’s global head of M&A.
