Despite a US market performance below historical averages, global mergers and acquisitions (M&A) value grew significantly in 2024, driven by a surge in European and Japanese deals. The total global M&A value rose 10.6% to $3 trillion, led by private equity-backed transactions that jumped 24.9% to $670 billion.
According to LSEG data, the US M&A market experienced an 8.3% growth to $1.4 trillion, still below historical averages due to ongoing interest rate and economic uncertainty. However, the European market showed a more promising performance, with deals in Japan, Switzerland, and other countries contributing to the overall surge.
The AI-driven data center boom is expected to be a major driver of M&A activity in 2025, according to Goldman Sachs’ co-head of M&A, Stephan Feldgoise. The sector saw $466.2 billion worth of deals this year, driven by hyperscalers like Microsoft, Meta, and Google investing heavily in infrastructure.
As the US transitions to a new administration under President-elect Trump, regulatory expectations are shifting towards a “normalization” approach. This is seen as favorable for M&A activity, with CEOs expressing more confidence than they did at the start of 2024. However, antitrust enforcement is expected to remain robust, particularly in the tech sector.
Experts predict that the IPO window will open in Q2-2025, but with limited room for new companies to enter the market. Meanwhile, AI-related M&A is poised to gain steam, driven by the convergence of technology and data centers. As the regulatory environment continues to evolve, dealmakers are optimistic about the potential for growth in 2025.
Source: https://www.axios.com/2024/12/19/mergers-2024-2025