Skip to main content
main content, press tab to continue
Press Release

Global M&A market sees exceptional rebound in activity in final quarter of 2020, led by surge in North American deals

January 12, 2021

As COVID dragged M&A activity to its lowest level in years, buyers in North America bounced back in the final three months to record their best quarter-on-quarter performance.
Mergers and Acquisitions

LONDON, 12 January, 2021 — Global mergers and acquisitions (M&A) activity in 2020 fell to its lowest level since the aftermath of the financial crisis over a decade ago, despite a surge in dealmaking in the final three months, according to latest research on completed deals 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), the data reveals that companies worldwide completed just 674 deals valued over $100 million in 20201, significantly less than the previous year (774) and the lowest annual volume since 2009 (322).

Acquirers worldwide have now on average failed to add value from transactions for four consecutive years, based on share-price performance, having underperformed the Global Index by -1.9pp (percentage points) over the past year.

Despite the deadening impact of COVID-19 on M&A activity for much of 2020, the QDPM data revealed a sharp rise in volume in the final quarter with 246 deals completed worldwide, compared to 210 in Q4 2019, including the highest ever number of large deals2 completed in a final quarter (61). This resurgence has so far been driven by a strong uptick in activity by North American buyers with a record number of deals (136) for a final quarter, matched by the region’s first positive quarterly performance in three years.

European buyers maintain their resilient form by outperforming their regional index by +5.3pp in Q4, while UK acquirers continue to shrug off Brexit challenges by beating the European Index by +4.1pp for the full year. Market conditions in the APAC region remain volatile following a negative quarterly performance of -8.7pp.

While the world in 2021 remains a volatile place, pent up demand, ample funding, ultra-low interest rates and confidence returning to boardrooms indicate conditions are ripe for one of the biggest M&A years on record.”

Jana Mercereau | Head of Corporate M&A Consulting, Great Britain at Willis Towers Watson

Jana Mercereau, Head of Corporate M&A Consulting, Great Britain at Willis Towers Watson, said: “The year 2020 has been unlike anything we’ve ever seen, fuelled by an enduring pandemic, massive economic uncertainty, a highly divisive US presidential election and rising geopolitical tensions. While the world in 2021 remains a volatile place, pent up demand, ample funding, ultra-low interest rates and confidence returning to boardrooms indicate conditions are ripe for one of the biggest M&A years on record.”

Global M&A deals – Annual performance

*The figures in the table show the annual median-adjusted performance of all acquirers.
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Average Annual Performance (percentage points)* 4.0 2.7 -0.7 4.5 5.5 10.1 5.4 -1.3 -3.0 -5.0 -1.9

Five M&A trends for 2021

Despite the uncertain economic outlook, conditions are primed for a dealmaking surge in 2021, with our data suggesting a rally may have already begun. That said, the road to recovery will not be smooth. Jana Mercereau shares her top trends for the year ahead.

  1. 01

    An increasingly bipolar world

    When President-elect Biden takes office, a straightforward shift from the isolationist stance of President Trump’s administration to more internationally expansive market conditions is unlikely. Instead, a geopolitical and macroeconomic environment dominated by tensions between the US and China is expected, with emerging economies largely aligning with China, and Europe caught in between.

  2. 02

    COVID: A race against time

    Governments are running out of cash, spending trillions to keep businesses and jobs afloat in the hope of a jump-start in 2021. Will economies warm up in time or will the fallout from the pandemic be worse this year, triggering a wave of insolvency that overwhelms the global economy, crushing any prospect of recovery in the short term?

    Some sectors have already reached their ‘tipping point’. Accelerated consolidation, restructuring and divestitures will dominate the travel, retail and real estate sectors.

    COVID-19 has also seen a quantum leap in the rate of digital adoption in financial services. In particular, the shift to remote working practices precipitated by the pandemic and calls to pursue a ‘green’ economic recovery are expected to drive M&A activity in the tech sector in 2021 and beyond.

  3. 03

    Remapping the geography of M&A

    Turbocharged by the pace of technology adoption during the pandemic, the criteria for dealmaking have substantially changed, with location slipping down the priority list for acquirers when targeting companies. Instead of searching in Manhattan or London, a major bank looking to buy a fintech, for example, is increasingly likely to look beyond the borders of Europe and North America to new markets to access the right talent. The implications for the M&A market in 2021 and longer term will be significant.

  4. 04

    SPACS on the rise

    The evolution of Special Purpose Acquisition Companies (SPACS) in the US has been dramatic, with 2020 a record-breaking year for the ‘blank cheque’ firms. Despite significant growth (350% increase year on year), they still represent only a small fraction of the overall M&A market (<1%). Their strong track record, however, is intensifying pressure on regulators in other countries to relax rules and allow SPACS to operate in their markets. With questions over due diligence yet to be resolved, a new wave of SPACS seeking acquisition targets outside of North America in 2021 is more likely to be seen in markets less tightly regulated than Europe. Time will tell how many of these ventures will be successful.

  5. 05

    Post-Brexit: What next for UK financial services?

    Since the Brexit vote in 2016, M&A activity has continued in the UK and Europe against a backdrop of political and economic uncertainty. While December’s last-minute deal ensures tariff-free trade will continue, how financial services will be affected remains unclear. This uncertainty will inevitably lead to some market volatility and disruption, creating M&A opportunities in 2021 for UK businesses and overseas buyers, as some sectors benefit from severing ties with the European Union, whilst others struggle.

Mercereau said: “The pandemic demonstrated a need for companies to double-down on efforts to adopt innovation into existing business models and focus on a digital approach to build new routes to market. Following a rollercoaster year for M&A, firms will continue to look to build resilience to withstand future shocks or crises, with an increasing number of transactions across all sectors focused on diversification and capturing long sought-after capabilities.

“That said, dealmakers should not assume a corner has been turned, with uncertainty set to remain. It will be as critical as ever for acquirers to pick their targets carefully for growth, before jumping into a deal if they are to give themselves the best chance of success. A dedicated focus on HR and people-related risks during due diligence and integration can help achieve this.”

Willis Towers Watson QDPM Methodology

  • All analysis is conducted from the perspective of the acquirer.
  • Share-price performance within the quarterly study is measured as a percentage change in share price from six months prior to the announcement date to the end of the quarter.
  • All deals where the acquirer owned less than 50% of the shares of the target after the acquisition were removed, hence no minority purchases have been considered. All deals where the acquirer held more than 50% of target shares prior to the acquisition have been removed, hence no remaining purchases have been considered.
  • Only completed M&A deals with a value of at least $100 million which meet the study criteria are included in this research.
  • Deal data sourced from Refinitiv.

About Willis Towers Watson M&A

Willis Towers Watson’s M&A practice combines our expertise in risk and human capital to offer a full range of M&A services and solutions covering all stages of the M&A process. We have particular expertise in the areas of planning, due diligence, risk transfer and post transaction integration, areas that define the success of any transaction.

About Willis Towers Watson

Willis Towers Watson (NASDAQ: WLTW) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 45,000 employees serving in more than 140 countries and markets. We design and deliver solutions that manage risk, optimise benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals. Our unique perspective allows us to see the critical intersections between talent, assets and ideas — the dynamic formula that drives business performance. Together, we unlock potential.


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.

2 Completed M&A deals with a value between $1 billion and $10 billion.

Contact us