With the U.S. government returning to a more business-friendly policy and business confidence recovering, M&A and IPO activity rebounded rapidly in 2025, and the market expects this momentum to continue next year.
According to Dealogic, the total value of announced mergers and acquisitions (M&A) deals worldwide this year is approximately $4.8 trillion. This is the highest level since the golden age of 2021 and the second-highest year for M&A activity in the past decade.
Of these, 166 deals were valued at over $5 billion, the highest number since 2021. However, despite this surge in massive transactions, the number of M&A deals announced this year is the lowest in at least a decade.
Technology companies have dominated this year’s M&A market, accounting for more than one-fifth of all announced deals, with a total value of $1 trillion, more than double that of the second-ranked healthcare industry.
Furthermore, the return of leveraged buyouts also signifies a recovery in the M&A market. Global private equity transaction volume reached $1 trillion this year, the highest level since 2021; the number of transactions reached 7,854, the highest in three years.
Mergers and acquisitions activity this year generally showed a weak first half and a strong second half, mainly due to a series of risky policies issued by the US government in the first half of the year, such as tariffs and semiconductor-related policies . Export restrictions and other measures have not only caused sharp fluctuations in asset markets but have also shaken the confidence of business leaders.
However, Frank Aquila, a partner at Sullivan & Cromwell, said the M&A market saw explosive growth in the second half of the year, somewhat catching up with the industry's full-year 2025 expectations from a year ago.
Some traders say that falling interest rates have fueled this wave of M&A activity. Companies can borrow at lower costs, enabling them to finance deals, while company valuations have also stabilized.
At the same time, private equity firms face enormous investment pressure. (According to S&P Global...) It is estimated that private equity firms currently hold approximately $2.1 trillion in so-called "dry powder," or unused investment capital, which makes investors eager to see this huge sum of money put to good use.
While the IPO market isn't as booming as the M&A market, it's still showing a thriving trend. Dealogic data shows that 1,372 companies went public globally, raising a total of $170.6 billion. This is the best year for IPOs since 2022, but still far below the $606.4 billion raised in 2021.
The technology sector is also a major force in the IPO market, accounting for 29% of the global IPO market. The largest IPOs are almost entirely dominated by technology companies, such as cloud computing companies . Service provider CoreWeave, software manufacturer Figma, etc.
This year's fruitful results have also fueled the expectations of dealmakers for 2026, who believe the first half of next year will be similar to the second half of this year. Morgan Stanley Arnaud Blanchard, global head of equity capital markets, said that current communication is very positive and the number of projects planned to be launched next year is also considerable.
(Article source: CLS)
