Dealmakers see rebound after US activity buoys global M&A volumes

investing.com:

By Anirban Sen and Anousha Sakoui

NEW YORK (Reuters) — Mergers and acquisitions activity globally showed few signs of improvement in the third quarter but a rebound in volumes in the United States — the world's biggest investment banking market — gave dealmakers hope of a sustained recovery in the near term.

The total value of M&A fell slightly to $717.4 billion during the September quarter, according to data from Dealogic, from $738.1 billion last year during the same period.

U.S. dealmaking contributed to a larger-than-usual share of global activity and offset a decline in volumes in Europe and Asia Pacific, accounting for about half of global volumes.

«My outlook is stable — we're going to continue to see a steady flow of deals. We're not going to see the craziness that we had in 2021. But on the other hand, I think all these predictions of the demise of M&A are overblown,» said Melissa Sawyer, global head of M&A at law firm Sullivan & Cromwell LLP.

U.S. dealmakers advised on deals worth $356.51 billion during the quarter — a 35% jump from the same period last year. Deal volumes in Europe and Asia Pacific fell 31% and 9%, respectively.

Investment bankers and M&A lawyers blamed headwinds such as high interest rates, increased antitrust scrutiny, and a looming U.S. federal government shutdown for the sluggish pace of activity, but pointed out that cash-flush buyers have started to fight through the market conditions to go after sizable targets.

This could lead to more hostile and unsolicited approaches from well-capitalized buyers, they said, pointing to examples like Cleveland-Cliffs (NYSE:CLF) Inc's $7.3 billion bid for U.S. Steel.

«There is a good amount of pent-up demand for M&A. In 2023, the deals that are