{"id":90592,"date":"2024-03-29T00:00:00","date_gmt":"2024-03-29T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/uae\/blockbuster-transactions-double-in-1q-as-mas-rebound\/"},"modified":"2024-03-29T00:00:00","modified_gmt":"2024-03-29T00:00:00","slug":"blockbuster-transactions-double-in-1q-as-mas-rebound","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/uae\/2024\/03\/29\/blockbuster-transactions-double-in-1q-as-mas-rebound\/","title":{"rendered":"Blockbuster transactions double in 1Q as M&As rebound"},"content":{"rendered":"

The number of mega-acquisitions valued at USD 10 bn or above more than <\/strong>doubled worldwide in the 1Q 2024<\/strong>, with 11 transactions totaling USD 215 bn taking place over the first three months of 2024, compared to five transactions worth a total of some USD 100 bn during the same period last year, the Financial Times<\/a> reports, citing data from the London Stock Exchange Group. <\/p>\n

The growth was driven by large-scale transactions in the US in the energy, tech and financial sectors<\/strong>, reflecting companies\u2019 appetite for \u201ccapitalizing on the market conditions to accelerate growth,\u201d Citi\u2019s head of investment banking Tyler Dickson told FT.<\/p>\n

This growth indicates that the market is on course to recover from its \u201clengthy drought\u201d,<\/strong> following a period of stagnancy in M&A activity on the back of the Covid-19 pandemic and the ensuing market volatility, which led to the market shrinking to a decade-low decline<\/a>.<\/p>\n

While large-scale transactions are seeing an uptick, the total number of transactions globally fell 31% <\/strong>over the first three months of 2024. However, the overall value grew to USD 690 bn, marking a 30% y-o-y increase.<\/p>\n

What spurred the rebound?<\/strong> M&A activity surged as investors anticipate rate cuts<\/a> from central banks, expected to come in June. The expected rate cuts have reduced financing costs, facilitating takeovers, in tandem with a resurgence in IPO activity. <\/p>\n

By region:<\/strong> The US made up the lion\u2019s share of takeover activity, growing 59% y-o-y to USD 431.8 bn, Reuters<\/a> reports. The European market also jumped more than 60% y-o-y to USD 127 bn. Meanwhile, transactions in the Asia-Pacific region fell 28% y-o-y, amounting to USD 90 bn.<\/p>\n

The market is expected to expand further:<\/strong> Bankers and M&A firms foresee that the M&A momentum will continue to grow throughout the year as companies pursue more takeovers, as fears of recession diminish and economic indicators suggest that the global economy is headed to a \u201csoft landing\u201d and that inflation is under control. \u201cBoards and management teams feel more comfortable about the future,\u201d Reuters quotes co-head of global M&A at Bank of America Ivan Farman as saying.<\/p>\n

ALSO WORTH NOTING- Amazon ramps up AI investments with USD 2.75 bn for <\/strong>AI startup: <\/strong>Amazon has pledged a USD 2.75 bn investment in US-based AI firm Anthropic, marking the e-commerce giant\u2019s largest venture investment to date and bringing the total value of its investments to Anthropic to USD 4 bn, the Financial Times<\/a> reports. <\/p>\n

The company is attracting interest from investors<\/strong>, with Anthropic poised to raise at least USD 750 mn from VCs in a funding round expected to close next month, people familiar with the matter told FT. Google has reportedly also agreed to pour USD 2 bn into the startup, according to a person in the know.<\/p>\n

ICYMI- <\/strong>Abu Dhabi sovereign wealth fund Mubadala agreed to purchase a <\/strong>USD 500 mn stake<\/a><\/strong> in Anthropic<\/strong> from Sam Bankman-Fried\u2019s bankrupt crypto exchange FTX earlier this week. Mubadala is the biggest buyer in a consortium of buyers snapping up two-thirds of FTX\u2019s 8% stake in the company.<\/p>\n

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THE MARKETS THIS MORNING-<\/p>\n

It feels kind of lonely here in Dubai as we look ahead to the trading day: <\/strong>The Kospi, Hang Seng, and Shanghai Composite are all in the green, but markets from London and Paris to New York and Toronto are closed today and Monday for the Easter long weekend<\/strong>. <\/p>\n

YESTERDAY- The S&P 500 rose on Thursday, posting its best Q1 performance in five <\/strong>years<\/strong>, CNBC writes<\/a>. At the end of the first quarter:<\/p>\n