A sharp recovery in global mergers and acquisitions is on track to deliver the second-highest annual deal value on record in 2025, with transactions projected to reach $4.8 trillion, up 36% from 2024, according to Bain & Company.
Despite the surge in value, overall deal volumes are expected to rise by only about 5%, highlighting a market driven by fewer but significantly larger transactions.
Megadeals valued at $5 billion or more have been the primary catalyst for the rebound. These transactions accounted for roughly 75% of the growth in strategic deal value, while around 60% were undertaken by so-called infrequent acquirers. Moreover, close to two-fifths of these large transactions were transformational, each exceeding 50% of the acquirer’s market capitalisation.
Megadeals drive value as infrequent buyers return
Bain’s analysis indicates that companies traditionally cautious on M&A have returned to the market with large, high-conviction bets. However, the firm cautioned that such transactions carry elevated execution risk, as value creation depends heavily on strategic clarity, integration discipline and organisational alignment.
Technology-led deals, particularly those linked to artificial intelligence, have been at the forefront of the recovery. Technology M&A value is up more than 76% year-to-date at $478 billion, with almost half of strategic technology transactions above $500 million involving AI-native targets or citing AI-driven benefits. Advanced manufacturing has also been a key contributor, with deal value rising 38% to $717 billion.
Beyond technology, the rebound has been broad-based. Deal value has increased by double-digit percentages across regions and industries, while strategic transactions rose 38%, financial-sponsor activity increased 31% and venture capital deal value climbed 28%.
Easing conditions lift activity despite trade risks
Bain attributes the renewed momentum to improved market confidence, easing regulatory pressure and lower capital costs. The valuation gap between buyers and sellers has narrowed, with average multiples rising to 11.6x EV/EBITDA, while remaining below 2021 peak levels in most sectors.
Trade-related uncertainty had only a limited impact on dealmaking during the year. An early slowdown in April proved short-lived, and cross-border deal activity remained broadly stable. Fewer than half of M&A executives surveyed by Bain said trade restrictions would materially affect their acquisition plans.
However, the report notes that post-globalisation trends could exert a longer-term influence, as non-US buyers show reduced appetite for US assets and US acquirers increasingly prioritise domestic transactions. At the same time, capital allocation to M&A remains constrained, accounting for just 7% of cash expenditures among major global companies, as investment in AI, automation, infrastructure and energy competes for funding.
Artificial intelligence has also become embedded in deal execution. According to Bain, 75% of strategic acquirers have assessed AI’s impact on target businesses, while the use of AI tools by M&A practitioners has more than doubled, supporting sourcing, diligence and integration planning across transactions.
