Blink and you would have missed it: the moment when top dealmakers, startled by a string of bad news in this year’s first half, paused or considered pausing their dealmaking activities. While the news was more biting in some regions than others, no one fully escaped the abrupt shifts in trade policies or the brutal conflicts rattling Europe and the Middle East. The world remains global—at least for now.
Nonetheless, many dealmakers jumped back into M&A markets, whether they were channeling nerves of steel or simply had become inured to upsets following waves of uncertainty. (We think the latter is more likely—and will be a big factor in the months ahead.)
Rewarding these stalwart professionals, the M&A market that eventually unfolded turned out to be an accommodating place. Top dealmakers—who sharpened their focus and their risk tactics—thrived; giant deals made giant splashes; sectors switched top spots; and cross-regional trading continued. Meanwhile, private equity firms, which had hung back in recent years, returned to the market in an impressive way.
For the first half of the year, ending June 30, the value of deals over $25 million increased 22 percent globally to $2 trillion, from $1.7 trillion a year earlier (exhibit). While volume was flat at slightly over 3,700 deals, a surge in megadeals pushed activity higher. This was especially true in the United States as well as Asia–Pacific, as shifts in government regulations in Japan and China boosted dealmaking activity overall, to $490 billion, up 76 percent from a year earlier. Transaction value in Europe, the Middle East, and Africa (EMEA) declined just under 3 percent for the first half, to $443 billion from $456 billion a year earlier, though the value was sharply higher than the $309 billion transaction value achieved in the first half of 2023 (up 43 percent).
Meanwhile, average deal size reached $544 million globally—the highest level in five years. This was especially impressive since the earlier period included the heady times following the end of pandemic-era lockdowns—a development which lifted moods and spending and created a euphoric blip in M&A.
Extrapolating the market’s current $2 trillion value for the full year (that is, $4 trillion), M&A transactions would equal about 4 percent of global market capitalization, surpassing the level of the past two years. This suggests that the recovery we spotted earlier this year is indeed on its way (though companies should temper their optimism with the assumption that the trade and geopolitical volatility pelting dealmakers is unlikely to go away and could grow more or less severe).
Top dealmakers thrived
Understanding that a sound business strategy requires M&A irrespective of market conditions, the best dealmakers were among those who shrugged off external shocks in this year’s first half and continued their programmatic transactions. In our discussions with organizations seasoned in M&A, we also encountered a group that remained extraordinarily disciplined; they sharpened their focus on deals that could strengthen core businesses through consolidation or geographic expansion while eschewing the more exotic transactions in vogue during the “free money” days of low interest rates.
Many top dealmakers also reduce risk through a variety of strategies, including more rigorous due diligence, as well as adapt deal structures to spread risk across buyers and sellers. And increasingly, top dealmakers are deploying tactics that can boost integration speed and value capture. For example, announced cost synergies as a percent of transaction value are nearly double the levels of 2015, on average. Similarly, announced revenue synergies as a percent of transaction value have risen eightfold over the same period.
Big deals are back
Among the striking trends in this year’s first half was the surge in megadeals (those exceeding $10 billion), with the value of these transactions globally jumping 44 percent to $535 billion, from $372 billion a year earlier. Megadeals increased their contribution to global M&A value to 27 percent, from 22 percent a year earlier, as the number of these behemoth deals rose to 29 from 20. Few observers earlier in the year expected this kind of ebullience to take hold, given the turbulence in trade, geopolitics, and equity markets.
Despite the uncertain environment, acquirers in EMEA made five megatransactions—similar to the number from last year’s first half—but spent 17 percent more on megadeals for a total of $79 billion.
Meanwhile, for ambitious acquirers, targets in the Americas sent out the loudest siren call, as corporate profits and the US economy remained on solid footing, while the dollar and job growth fell. Dealmakers also hoped for relaxed regulation of US-based transactions—a development that has not yet materialized. Nonetheless, targets in the Americas accounted for 13 of the 20 largest transactions globally.
Meanwhile, the proportion of midsize deals globally ($1 billion to $ 10 billion in value) held steady at 45 percent in the first half, as the number of deals in this category increased to 353, from 275 a year earlier. Underscoring the shift away from smaller deals, the proportion of transactions valued at under $1 billion fell six percentage points in the first six months.
Sectors switch top spots
Another interesting development in the first half: technology, media and telecom (TMT) unseated global energy and materials (GEM) as the most active sector globally, with a 39 percent increase in the value of M&A deals. Financial institutions were another active sector globally. Together, these three sectors accounted for some 59 percent of the value of all deals. But the story varied by region. Financial institutions were the biggest contributor to M&A activity in EMEA, driven by a few large, announced deals in banking and insurance, while healthcare deals also increased sharply in the region, up 95 percent from a year earlier. Meanwhile, boosted by increasing interest in harnessing some of the exploding developments in AI, TMT transactions dominated in the Americas, and GEM transactions dominated in Asia–Pacific.
Deals continue across regions
In another surprise to many observers, cross-regional deals maintained a similar level to last year’s first half. Although the first quarter’s 19 percent contribution fell to 12 percent in the second quarter as trade issues gathered steam, cross-regional activity ultimately accounted for 16 percent of global M&A value in the first half, in line with historical averages. The Americas, again, were the largest focus of cross-regional dealmaking value overall, with net inflows of $58 billion in the first half, up from $38 billion a year earlier.
Private equity gets its mojo back
Financial investors, having tempered their M&A participation in recent years, made a much-anticipated increase in global M&A investments in this year’s first half. Observers have been betting that private equity participation in M&A markets would become more aligned with the burst in recent years of private investment industry funds and assets. An equally pressing incentive has been investors’ demands for exits. Average exit hold times reached an all-time high of 8.5 years in 2024—more than double the 4.1 years seen in 2007.1 But the most alluring incentive of all? The estimated $2.2 trillion in dry powder awaiting deployment. In the first half of the year, the value of transactions led by private equity firms jumped 33 percent to $471 billion, up from $354 billion a year earlier.
And that’s not all: The climate for financial investors may become even more favorable as private industry investments become more accessible to the retail class, at least in the United States. (The Americas historically accounts for more than half of M&A activity globally.) The new chairman of the Securities and Exchange Commission has signaled he supports this step.2 Meanwhile, the White House reportedly is preparing an executive order that would allow 401(k) retirement savings plans to invest in private equity.3
These developments could further reward financial sponsors who have long provided a major source of fuel for M&A.
Looking ahead, we continue to see the possibility of a strong second half in M&A, with the upside potential we predicted in our annual report for the year. No matter how the market unfolds, we and our M&A colleagues around the world will continue to closely monitor M&A market developments and trends and share our insights, including in our in-depth 2026 annual report on M&A early in the new year.
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