Mega Deals Resurface: Global M&A Surges in First Half Despite Trade War Headwinds
GerikSummary:
Despite initial setbacks due to Trump's trade war and geopolitical tensions, global M&A activity surged 26% in the first half of 2025, driven by larger deals and a rebound in market confidence...
Resilient Markets and Bigger Bets Power M&A Rebound
Global mergers and acquisitions (M&A) in the first half of 2025 have outperformed cautious expectations, with total deal value reaching $2.14 trillion—up 26% year-over-year—despite market turbulence sparked by U.S. President Donald Trump’s tariff war and elevated interest rates. While the total number of deals dropped, the average deal size grew significantly, with a notable 62% rise in $10 billion-plus transactions compared to the same period in 2024.
The unexpected strength in M&A stems largely from a late-quarter resurgence in U.S. equity markets and renewed optimism among institutional investors. According to Dealogic, North American deal volume hit $1.04 trillion by June 27, while Asia accounted for $583.9 billion—more than doubling its contribution from a year earlier. Japan and China led the charge, with regional giants like Toyota and ADNOC initiating multibillion-dollar transactions that kept capital circulating within Asia-Pacific.
Trump’s Tariff Policy Initially Disrupts, Then Clears Path
The launch of President Trump’s aggressive tariff campaign—branded “Liberation Day” on April 2—initially suppressed deal activity by creating uncertainty. Many IPOs and cross-border transactions were delayed or shelved. However, the unexpected upside emerged as Trump’s administration took a more lenient stance on antitrust reviews, which investment bankers suggest may facilitate future megadeals exceeding $50 billion in size.
Market sentiment further improved as the S&P 500 and Nasdaq reached record highs, pushing down volatility. The VIX index’s decline signaled growing investor confidence. This stabilization enabled dealmakers to restart negotiations and revisit postponed IPO plans.
U.S. and Asia Anchor Activity as Europe Lags
While North America remains the largest M&A market, Asia gained over 11 percentage points in global deal share from 2024, now accounting for 27.3% of total volume. Noteworthy transactions include Toyota’s $33 billion supplier buyout and ADNOC’s $18.7 billion acquisition of Santos in Australia.
In contrast, Europe’s M&A momentum remained relatively sluggish, hampered by persistent inflation and weaker capital market performance. However, bankers expect the global upswing to eventually lift deal activity in the region, especially in sectors benefiting from clean energy subsidies and industrial digitization.
Bankers Signal Stronger H2: IPOs Return, Investors Reengage
Interviews with senior bankers from UBS, Goldman Sachs, Bank of America, and Deutsche Bank highlight growing optimism for the second half of 2025. With monetary policy expectations stabilizing and institutional investors returning to equities, a window of opportunity for IPOs and leveraged buyouts is reopening.
“We’re seeing momentum rebuild,” said Jefferies vice chairman Philip Ross. “The number of new issuances and client mandates over the past three weeks is unlike anything we’ve seen since early 2022.”
Goldman Sachs noted that Asia-to-Asia deals are accelerating, while Deutsche Bank emphasized the resilience of European equities amid geopolitical shocks. In short, there is growing consensus that dealmaking could surpass pre-pandemic levels if macro risks remain contained.
Though the number of deals signed in H1 2025 (17,528) fell short of the 20,583 deals from the same period last year, the shift toward higher-value transactions signals a new phase in global dealmaking. With regulatory barriers easing in the U.S., confidence returning to Asian markets, and risk appetite rebounding among major institutional investors, the stage is set for a blockbuster second half of 2025—one potentially marked by megadeals that redefine global capital flows.
Source: Reuters
To stay updated on all economic events of today, please check out our Economic calendar
Risk Warnings and Disclaimers
You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
