Global M&A Activity Remains Muted in Q2 2024, Says S&P Global Market Intelligence
Global M&A Activity Remains Muted in Q2 2024 Amid Federal Reserve Policy Rates
In a recent report by S&P Global Market Intelligence, it was revealed that global M&A activity remained subdued in the second quarter of 2024. This comes as the Federal Reserve has kept its policy rates elevated in an effort to combat inflation, making it more expensive to finance deals.
The report highlighted that the number of global announced M&A deals stayed below 10,000 for three of the last four quarters. In Q2 2024, there were 9,719 transactions announced, which was a slight increase from 9,696 in Q1 but a decrease from 10,784 in the same period last year. The total transaction value for the quarter was $600.1 billion, down from $621.1 billion in the previous quarter but up from $593.1 billion in Q2 2023.
Despite the muted activity, the total value of global M&A deals for the first half of the year increased by 12% to $1.22 trillion compared to the same period last year. The report noted that while the quarterly total value is still below 2021 levels when it surpassed the $1 trillion mark each quarter, the year-over-year rise in 2024 indicates that dealmakers are more willing to execute large transactions.
The report also highlighted the importance of deal-making activity for investment banks, which earn fees for advising companies on sales and acquisitions, as well as for underwriting equity and debt to finance these deals.
According to Dealogic, JPMorgan Chase led the way in revenue generated from global M&A in the first half of 2024, with $1.41 billion and a 9.9% market share. Goldman Sachs followed closely behind with $1.40 billion and a 9.8% market share, while Morgan Stanley generated $960 million, representing a 6.7% market share.
In terms of transaction value, Goldman Sachs advised on the largest chunk of global deals in the first half of 2024, with 201 deals totaling $498.8 billion. JPMorgan came in second, advising on 188 deals worth $411.6 billion, followed by Morgan Stanley with 171 deals totaling $396.9 billion.
The report also noted that Europe M&A activity saw a significant increase in Q2, with the total value of announcements jumping 65% quarter-over-quarter and 25% year-over-year to $182.9 billion, the highest level since Q2 2022.
Overall, while global M&A activity may have been muted in Q2 2024, the report suggests that dealmakers are becoming more active in executing large transactions, which bodes well for the investment banking sector.
