Dive Brief:
- It's been quite a year for mergers and acquisitions (M&A), as year-end results from Willis Towers Watson's Quarterly Deal Performance Monitor show that acquiring companies' closing deals in 2015 outperformed their index (MSCI World Index is used as default) by 10.1% over the year.
- In addition, completed M&A deals that meet the study criteria reached an all-time high of 1,041, as a record number (304) were posted in the fourth quarter, more than in any single quarter since the research began in 2008.
- The research — run in partnership with Cass Business School in the U.K. — shows that 22 megadeals worth over $10 billion were also completed, with five completing in the fourth quarter, also the highest annual total since the research began.
Dive Insight:
Looking ahead, Willis Towers Watson's 2016 M&A predictions say that global economic volatility and politics will be a key factor.
Megadeals will continue but a gradual slowdown in activity may happen. Cross-sector deals will continue to grow (despite being the toughest to complete), and weak commodity prices will continue to create opportunities in the Extraction, and Oil & Gas sectors.
In the area of megadeals, which would have the greatest impact on HR, Willis Towers Watson reports that pharmaceutical companies' M&A activity should continue unabated, driving megadeal activity in 2016. At the same time, if the number of smaller deals increases it could mean that "we are reaching the peak of the M&A cycle."
