The most recent look at the global mergers and acquisitions (M&A) picture from Pitchbook is out. How did things perform in the second quarter of 2022? Here’s a look.
The Overall Picture
The first look is of the overall M&A picture in North America. Activity peaked in the fourth quarter of 2021 – since then, activity has declined by approximately 30.2% and 37.6%, respectively, with about 4,571 deals closed and a combined value of $547.7 billion. Although activity is cooling, overall activity is still healthy compared to historical counts. At $547.7 billion, activity is still above its historical average as strategic buyers took stock of market volatility to find attractive growth prospects from cyclical companies.
The Share of M&A Value by Sector
The next view is of M&A activity by sector. Overall, M&A managers showed increasing interest in the IT sector, with about 20% of all activity in this sector. The only sector that showed greater interest was Business Products & Services, which captured about 30% of M&A managers’ interest. In third place was Consumer Products & Services at around 15%. The remaining members included Healthcare, Energy, Financial Services, and Materials & Resources.
A View by Payment Type
The next view is of M&A activity by payment type. Overall, by far the most common source of funding was cash at about 60%. The second most popular source of deal funding was a combination of stock and cash at around 25%, followed by stock at around 15%.
The Share of M&A Value by Bucket Size
The next picture is the share of M&A value by the size of the bucket. So far through the first half of 2022, the largest slice of activity was in deals valued at $5 billion or higher, accounting for around 25% of all activity. In second was deals valued between $500 million and $1 billion, capturing about 15% of all deals. Rounding out the top three were deals valued at $1 billion to $5 billion and deals valued at $250 million to $500 million, with both capturing around 10% of the deal value. Smaller deals accounting for the remaining activity.
Summing Up
Overall, global M&A activity continued its modest slowdown in deal value and volume over the course of the second quarter. This came at a time when the S&P 500 suffered its worst first half of the year since 1970. Time will tell how activity will shape up for the remaining two quarters of the year.
Comments on this entry are closed.