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Q3 2020 - Global M&A market sees first positive performance since 2017

Q3 2020 Quarterly Deal Performance Monitor

By Jana Mercereau and Duncan Smithson | October 28, 2020

Despite announced M&A deals rebounding in the third quarter as boards went on a deal spree, new data on completed deals demands some caution.
Mergers and Acquisitions
Mergers and Acquisitions

The global M&A market recorded its first positive performance in three years for completed deals, despite the impact of the COVID-19 pandemic on dealmaking during 2020, reveals new M&A data from Willis Towers Watson.

Based on share price performance, the latest results from Willis Towers Watson’s Quarterly Deal Performance Monitor (QDPM), run in partnership with the M&A Research Centre at The Business School (formerly Cass), show that buyers outperformed the MSCI World Index1 in the third quarter of 2020, with a performance of +1.5 pp (percentage points) above the Index. This is the first positive performance by acquirers since the third quarter of 2017 (+0.7 pp).

However, deal volumes are at their lowest level for over a decade (since Q3 2009), with just 121 deals completed in the last three months. The ongoing economic impact and uncertainty caused by the pandemic have continued to depress deal completions globally.

bar chart shows M&A quarterly analysis from 2008 for each quarter till Q3 2020 indicating first positive performance since Q4 2017
The green line above (2.2pp) shows the median adjusted performance of all acquirers throughout the period.
The magenta line above (-3.0pp) shows the median adjusted performance of all acquirers over a three year rolling period.
The yellow line above (3.9pp) shows the median adjusted performance of all acquirers over one year rolling period.

NB: The share price returns have been adjusted to Index returns over the corresponding period. The MSCI World Index is used as default, unless stated otherwise.

M&A quarterly analysis – global performance

Jana Mercereau, Head of Corporate M&A Consulting, Great Britain at Willis Towers Watson, said: “It is too early to interpret the flurry of announced deals in recent months as a sign that M&A is on the rebound. Our research on completed deals and their performance provokes a more cautious response. With the volume of completed deals at its lowest in a decade, and performance of North American deals at rock bottom, fuelled by enduring pandemic, economic and political uncertainty, buyers need to be both bold and careful.”

bar chart showing M&A regional analysis for Q3 2019 and Q3 2020 for North America, Europe and Asia Pacific
M&A Regional analysis – Q3 2019 and Q3 2020

COVID-19 was a massive shock, hitting economies and stock markets globally, yet instead of collapsing, M&A deals continue to defy gravity. Compared with previous economic cycles, the amount and diversity of capital available for M&A is extraordinary, assisted by historically low interest rates. Buyers who act decisively and with robust due diligence to exploit opportunities during this period of uncertainty could see higher returns than their industry peers and drive long-term growth.


1 The M&A research tracks the number of completed deals over $100m and the share price performance of the acquiring company against the MSCI World Index, which is used as default, unless stated otherwise.


Head of Human Capital M&A, Great Britain

Senior Director, Mergers and Acquisitions

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