The first quarter of 2024 saw a significant increase in deal activity compared to Q1 2023. Total deals in Q1 2024 totalled $613bn, a rise of 38% year-on-year (YoY). In terms of deal volume, there was a slight drop of 13% from 8,301 deals in Q1 2023 to 7,248 M&A deals in Q1 2024, according to GlobalData.

This drop in M&A deals can be attributed to climbing inflation, rising interest rates, tumbling tech, and a weaker Euro.

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Key takeaways

Below are the key trends that were observed in Q1 2024.

  • Billion-dollar deals shrank – Q1 2024 saw a fall in the number of mega deals. These are deals where the transaction value is greater than or equal to $1bn. In Q1 2024, there were 121 mega deals recorded, which was a decline of 8% compared to Q4 2024—but this marked a rise of 53% YoY.
  • TMT continued to dominate M&A deal activity – The technology, media, and telecom (TMT) sector continued to dominate, with 2,163 deals worth $186bn recorded in Q1 2024. The TMT sector also accounted for six out of the top 20 global M&A deals in Q1 2024, driven by several key themes including connectivity, big data, cloud, and Internet of Things. TMT was followed by the energy sector (which includes oil & gas and power & utilities) and the basic materials sector (including construction, mining, chemicals, agriculture, and forestry), with deal values of $146bn and $144bn, respectively.
  • Supply chain disruption was the most prominent theme in terms of deal volume – in Q1 2024, the supply chain disruption theme drove 19 M&A deals out of the top 150 M&A deals in Q1 2024 by deal volume, as well being the most prominent theme by deal value, with a total deal value of $52bn. Other noteworthy themes included ESG (Environmental, Social, and Governance), emerging economies, connectivity, and the future of work.
  • North America recorded the highest M&A deal activity – North America continued to dominate M&A deal activity with 3,007 deals worth $385bn recorded in Q1. All regions though saw a drop in deal volume Q1 2024 compared to Q1 2023.

Notable deals in Q1 2024

Q1 2024 saw some interesting deals such as Capital One Financial’s $35bn acquisition of Discover Financial Services, a direct banking and payments services company, and Synopsys’ acquisition of ANSYS, a provider of engineering simulation software and services for $35bn.

Other prominent deals included Diamondback Energy acquiring Endeavor Energy Resources, an exploration and production company for a deal value of $26bn, and Novo Holdings’s $17bn acquisition of Catalent, a provider of advanced delivery technologies and development solutions for drugs, biologics, and consumer health products.

M&A 2024 outlook

The M&A outlook for the rest of 2024 remains subdued though the prospect of rate cuts in certain markets and a generally improving growth outlook could see an increase in activity throughout the year. Mega deals will continue to face hurdles, especially in the US where antitrust concerns have been a focus of regulators.

As businesses navigate the rapidly changing global landscape, integrating ESG principles into M&A strategies has become a necessity for long-term success. However, the M&A market will rebound throughout 2024 as interest rates fall and acquisitions remain a key element of corporate strategy.