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Press Release

Surge in North American deals drives the global M&A market to rebound in Q4 of 2020

January 12, 2021

As COVID-19 dragged M&A activity to its lowest level in years, NA buyers recorded their best quarter-on-quarter performance.
Mergers and Acquisitions
Mergers and Acquisitions

ARLINGTON, VA, January 12, 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. This, despite a surge in deal making in the final three months, according to latest research on completed deals from leading global advisory, broking and solutions company Willis Towers Watson’s Quarterly Deal Performance Monitor (QDPM).

Data from the QDPM, run in partnership with the M&A Research Center at The Business School (formerly Cass), reveal companies worldwide completed just 674 deals valued over $100 million in 2020,1 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 –1.9 percentage points over the past year.

Despite the stifling 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 with 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 (+5.9 percentage points) in three years.

“2020 was unlike anything we’ve ever seen, fueled by an enduring pandemic, massive economic uncertainty, a highly divisive U.S. presidential election and rising geopolitical tensions,” said Duncan Smithson, senior director, M&A, Willis Towers Watson. “While the world in 2021 remains a volatile place, pent-up demand, ample funding, ultralow interest rates and confidence returning to boardrooms indicate conditions are ripe for one of the biggest M&A years on record.”

European buyers maintained their resilient form by outperforming their regional index by +5.3 percentage points in Q4, while U.K. acquirers continued to shrug off Brexit challenges by beating the European Index by +4.1 percentage points for the full year. Market conditions in the Asia Pacific region remain volatile following a negative quarterly performance of –8.7 percentage points.

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

“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,” said Smithson. “Following a roller-coaster year for M&A, firms will 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, deal makers 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,” Smithson concluded.

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 that meet the study criteria are included in this research.
  • Deal data are sourced from Refinitiv.

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, optimize 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 $100 million 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.

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