M&A mid-year review: Enthusiasm for portfolio growth spurs M&A activity

Merger and acquisition activity throughout the United States hit record high numbers in the first half of 2018, according to EY’s M&A Mid-year Review.

According to EY, there was $978 billion of net M&A activity from January to May, up 80 percent from the same period last year. This is 2018’s highest-yet figure for a calendar years’ first five months.

“Continued global expansion and pro-growth domestic policies are filling coffers and inspiring confidence in shareholders, CEOs and C-suites across the U.S.,” said Bill Casey, EY Americas vice chair, transaction advisory services.

“Executives and CFOs are taking a fresh look at their portfolios as industries respond to rapid innovation. This growing digital sophistication is driving an M&A market in which transactions are a key strategy, as reflected in the deal numbers we are seeing,” he said.

Enthusiasm for dealmaking is a result of higher corporate earnings, a rise in private equity-backed deals and a positive outlook for capital markets, EY said.

Two-thirds of U.S. executives (66 percent) said portfolio transformation is the top priority for senior management and shareholders.

Also, more than half (58 percent) said the main drive for M&A is acquiring talent.

According to the report, about half (54 percent) of U.S. executives said they expect to actively pursue M&A in the next year, and 61 percent expect their M&A pipelines to increase.

To read the full report, click here.