DealLawyers.com Blog

MergerMarket recently issued its Q1 2026 M&A Highlights report. Among other things, the report said that global M&A volume rose 22% year-on-year to $1.16 trillion through March 23rd. That’s the second highest first quarter ever after 2021. However, not all the news was good. This excerpt notes that financial sponsors had a bumpy ride during the year’s first quarter:

Headwinds from geopolitical uncertainty, private credit market jitters and scrutiny on AI from investment committees created a more challenging environment for sponsors in 1Q.

Global financial sponsor investment activity declined 14% YoY to USD 143bn. AES’s proposed USD 38.4bn buyout by a Global Infrastructure Management/ EQT-led consortium in early March accounted for nearly a third of the total, underlined the growing interest in infrastructure and energy transition from sponsors.

Exit activity also slowed, dropping 29% YoY to USD 112.4bn. Top-tier assets continued to command strong premiums, while sale processes in more volatile sectors paused or failed to trade. The largest exit was Aethon Energy Management’s USD 7.5bn sale of Aethon United in January, while partial exits, and more creative dealmaking were a strong feature of the market.

The report says that North American M&A grew 32% year-over-year to $611.1 billion. North American deals accounted for 55% of global volume and the first quarter was second-strongest first quarter on record for the region. The EMEA region also posted strong results, with deal volume up 48% year-over-year to $334.7 billion. The Asia Pacific region was the laggard, with deal volume declining by 27% year-over-year to $165.2 billion. MergerMarket says the Asia Pacific region was heavily impacted by the Iran war and its reliance on oil imports.

In terms of industry sector performance, tech led all sectors with a record $357.5 billion in deal volume. OpenAI’s staggering $110 billion raise. Utility and energy followed with a record $ 132.5 billion. The financial services sector also had a strong quarter, with deal volume doubling year-over-year.

– John Jenkins