Global M&A Hits Record High in First Half, Lifted by U.S. AI Boom

[Financial News]  Global mergers and acquisitions (M&A) in the first half of this year hit an all-time high, driven by the boom in artificial intelligence (AI)-related companies on U.S. stock markets. In particular, companies in the United States looking to ride the AI wave showed strong interest in acquiring related firms.
The Financial Times (FT) reported on the 1st, local time, citing data from the London Stock Exchange (LSEG). M&A deal value in the first half reached $2.83 trillion, or about 4,398 trillion won, the highest since data collection began in 1980. That was about 49% higher than a year earlier and above the $2.74 trillion recorded in the first half of 2021, just after the COVID-19 pandemic ended. Deals worth more than $1 billion also rose to 47 in the first half, up 62% from the same period last year and the highest on record.
However, while M&A value increased this year, the number of deals fell by about 9%, marking the lowest level since 2020. By region, transactions in the United States and Europe drove the global M&A market higher. In the first half of this year, M&A value in the United States and Europe rose 77% and 105%, respectively, from a year earlier. Deal value in the Asia-Pacific region fell 2.4%. In Europe, however, the number of deals itself dropped 14.2% from a year earlier because of the fallout from the Iran war.
Citing sources, FT said U.S. M&A increased thanks to looser antitrust regulation under the second Trump administration. It also said companies and investors are increasingly interested in M&A as they try to keep pace with the economic restructuring driven by the recent AI boom. By sector, technology companies accounted for the largest number of M&A firms, followed by energy and power, and industrials. Those sectors are tied to AI development and maintenance, including data centers and power plants. FT added that companies in other sectors are also watching M&A closely, hoping to benefit from the AI investment frenzy and attract capital that is flowing toward big tech.
Last month, U.S. renewable energy company NextEra Energy and grid operator Dominion Energy agreed to merge. FT said the deal was made possible by rising electricity demand from AI data centers. SpaceX, the parent company of AI firm xAI, also acquired Anysphere, the parent company of the AI coding application Cursor, for about $60 billion last month, shortly after its public listing.
In addition, U.S. media company Fox Corporation acquired streaming hardware maker Roku for $22 billion last month. FT also reported that major pharmaceutical companies are buying biotech firms to develop new drugs.
Ben Goodchild, a partner at U.S. law firm Paul Weiss, said, "There is a risk-taking mood right now, so deals are increasing," adding, "Boards are considering every possibility, including one-off transactions." Charlie Buckhardt, global head of M&A at JPMorgan Chase & Co., argued that there is a strong "let's act first" mood in boardrooms. He said, "Companies know very well that standing still is itself risky, and that the strategic need to act outweighs uncertainty."
Meanwhile, FT said the reason M&A-related capital in the first half was concentrated in large deals while smaller transactions declined was the risk posed by volatile energy prices. It also said there are concerns that AI could shake up each company's business model.

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