Large M&A deals driving momentum in 2025, report says
Completed mergers and acquisitions (M&A) globally went up by 15% in the last 12 months, a significant increase driven by a surge in large transactions.
WTW's Quarterly Deal Performance Monitor revealed there were 710 deals valued over $100 million that were completed worldwide in the last 12 months, higher than the 619 transactions in 2023.
According to the monitor, there were 15 megadeals valued at over $10 billion completed worldwide throughout 2023, higher than the 11 megadeals in the year prior.
There were also 162 large deals valued between US$1 billion and $10 billion completed throughout 2024, including 99 that took place in the second half of the year.
This represents a 36% increase in the second half of 2024 compared to the same period in 2023, a resurgence that the report noted is driving momentum into 2025.
In the Asia-Pacific region, there were 163 deals closed in 2024, five per cent higher than the 155 recorded a year ago. Deal numbers were also up by 32% in Europe and 14% in North America.
"Similar to 2023, Japan continued to be the most active market for our clients in 2024, while China had a particularly quiet year offset by a rebound in Q4," said Max Wright, M&A Consulting Leader Asia Pacific at WTW, in a statement.
"We saw an increase in the number of companies proactively working on boosting their M&A capabilities in anticipation of increased deal activity. The tight market for talent continued although buyers are confident in their ability to retain key executives and talent during acquisitions – with the right preparation and frameworks."
Merger and acquisition trends for 2025
Meanwhile, WTW predicts that M&A activity will likely surge in 2025 due to higher margin pressure, among other factors.
Economic conditions and geopolitical events across the world will also make an impact on M&As this year.
"Companies will need to be ready for the risks that come with rapid changes in regional and global stability, in particular conflicts in the Middle East and Ukraine," WTW said. "The impact of the US and China's trade relationship on the cost of doing business could create further complexities that dealmakers will need to navigate carefully during the year ahead."
Role of HR in M&As
HR leaders play an important role in M&As, particularly preserving existing and integrating new traditions from merging organisations.
"That's really important when you think about global organisations," said Cheryl Kerrigan, Chief People Officer at Toronto-headquartered BlueCat, which recently acquired a company in Iceland.
"You can bring people into your organisational culture, but I think it's important to celebrate the traditions and culture of the company you're acquiring."
Having a culture code will be crucial in an organisation's acquisition strategy, as they can help look at similar cultural attributes.
"We've done a couple of acquisitions, and that culture code has really driven not only our employee engagement but also what we hold as critical in what and who we're looking to acquire," Kerrigan previously told HRD.
