Mergers and acquisitions activity surged globally in the first quarter of 2021 to a year-to-date record, as companies and investment firms rushed to get ahead of changes in how people work, shop, trade and receive healthcare during the COVID-19 pandemic.
"This is as robust and broad-based an M&A market as I have witnessed in the last 20 years," said Colin Ryan, co-head of Americas M&A at Goldman Sachs Group Inc."We are in an environment where assets are scarcer than the available capital right now." Around half the deal activity came from United States where volumes were up 160per cent year on year at US$654.1 billion.In contrast, M&A activity in Europe was up 24.5per cent year on year at US$277.3 billion, as mega-deals became more difficult to negotiate with the French government blocking a proposed 16.2 billion euro takeover of European retailer Carrefour SA by Canada's Alimentation Couche-Tard in January."This year we have seen a continuation of cross-border activity.
"What you're seeing right now and will see to an even greater extent throughout the year is strategics coming out of hibernation and trying to do the things they've been thinking about for months," said Alan Klein, co-head of M&A at Simpson Thacher. A further catalyst for activity could come from activist investors, which are shareholders in a company agitating for change. In the first quarter, the likes of department store Kohl's Corp, French food and beverage company Danone SA and oil giant Exxon Mobil were subjects of activist campaigns.
"Private equity funds are standing front and centre in the dealmaking arena and driving a strong pipeline of public-to-private transactions," said Dwayne Lysaght, JPMorgan's co-head of EMEA M&A.
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