Global dealmakers achieved their first positive M&A performance for a full year in 2021 since 2016, according to latest research on completed
deals from Willis Towers Watson’s Quarterly Deal Performance Monitor (QDPM). Based on share-price performance, companies making M&A deals outperformed the World Index by +1.4pp (percentage points) on average.
Run in partnership with the M&A Research Centre at The Bayes Business School (formerly Cass), the data also reveals that global activity breached new highs as completed deals valued over $100 million reached 1047 in 2021. This represents a significant increase on the previous year (674) and is the highest annual volume since our analysis began in 2008. Deal volume in North America remained consistently strong during 2021, with acquirers closing 614 deals, almost double the 325 deals achieved in the previous 12 months, although they only outperformed their regional index by the narrowest of margins (+0.5pp).
For the full year, APAC dealmakers recorded their strongest performance since 2016, outperforming their index by +16.8pp, despite closing only fractionally more deals regionally compared to 2020 (196 vs 173), as fewer Chinese acquisitions continued to depress volume levels. European acquirers outperformed their regional index, showing a positive performance of +3.9pp and 199 deals closed in 2021, up a quarter on 155 deals
in the prior 12 months. UK acquirers have consistently outperformed the FTSE All-Share index over the last five years, recording a positive performance of +5.7pp for the year.
Jana Mercereau, Head of Corporate M&A Consulting, Great Britain at Willis Towers Watson, said: “The M&A boom in 2021 looks set to continue, fuelled by abundant investment capital, strong equity markets and cheap debt, and companies under pressure to make their businesses greener by hunting for targets with the right climate credentials. M&A data coming out of North America also highlights the impact that historically high asset valuations, pushed up by competition and increasing complexity, can have on deal performance. The question is whether prices being paid now will continue to make sense over time.”