LONDON, April 20 – Corporate merger and acquisition activity worldwide has made a strong comeback following a dramatic downturn that occurred in the weeks immediately after Iran war hostilities began, with businesses and financial backers moving forward on major deals despite market instability.
Deal values announced internationally during March’s second week plummeted to approximately $39 billion as military actions by the United States and Israel against Iran created market turbulence. This represented the weakest weekly performance since last April’s “Liberation Day” tariff announcements caused similar disruption, based on LSEG financial data.
The global transaction market has since staged a remarkable recovery, fueled by several massive business combinations including Pershing Square’s proposed $68 billion acquisition of Universal Music Group and the $45 billion merger between McCormick & Co and Unilever’s food division.
During the four-week period starting March 15, worldwide merger and acquisition activity averaged approximately $117 billion per week, surpassing the roughly $93 billion weekly pace recorded during January and February, the financial data revealed.
“CEO confidence has dropped a bit but the significance and the logic of those corporate transactions remains,” stated Guillermo Baygual, who serves as Citi’s global co-head of mergers and acquisitions.
“The geopolitical dynamics, if anything, can add some uncertainty short term but in the long term they justify even more some of these needs to gain scale, to gain cost efficiency and capacity to finance the capex needs that are going to be almost imperative and to deliver further growth,” Baygual explained.
Certain geographical areas have experienced greater impact from the regional instability. Merger activity targeting Gulf region companies totaled approximately $15 billion during 2026 thus far, representing a 65% decline compared to the same timeframe last year, even as deal announcements increased by 5%.
February saw 70 transactions announced in the Gulf region according to LSEG, a monthly figure exceeded only once during the past five years. Following the conflict’s start in March, however, just 37 deals were revealed, marking the lowest monthly count since August 2025.
Gulf-based companies have remained active as purchasers, though. Acquisition spending by Gulf entities reached $17.1 billion during the six weeks following the February 28 Iran war commencement. This amount represents a 244% increase from the six weeks preceding the conflict, though it remains 21% below the comparable 2025 period, LSEG reported.
Despite fewer overall transactions globally, corporations continue pursuing significant transformational deals.
Smaller transaction volumes have declined, potentially reflecting geopolitical tensions and broader economic conditions, according to Nimesh Khiroya, Goldman Sachs’ co-head of European, Middle Eastern and African mergers and acquisitions. He indicated the recovery stems from larger deals that were already under development.
“Large deals would have been in development for a period of time and are not a response to the Middle East conflict,” Khiroya noted.
Equity capital markets activity has decelerated following an exceptionally busy two-week period right after the conflict began, when nearly $50 billion in global transactions occurred, LSEG data indicated. Worldwide equity capital markets reached $215 billion through April 14, climbing 37% compared to last year’s equivalent timeframe.
The week directly following the attacks became 2026’s busiest in terms of capital raised, as some companies and shareholders accessed equity investors before potential further market deterioration could limit fundraising capabilities, three equity advisors previously informed Reuters.
From March 15 through the subsequent four weeks, global equity capital markets deals averaged around $11 billion weekly, declining from January’s $13 billion and February’s $18 billion levels. This reduction partly reflects decreased new share offerings triggered by the war and a typically quieter earnings reporting season, one advisor told Reuters.
Current market indicators suggest conditions may support renewed deal activity. The CBOE Volatility Index, a widely monitored measure of investor concern, surged when the late February conflict erupted but has since declined below 20 in April. Trading below that 20 threshold typically signals more stable, less stressful market environments, dealmakers indicate.
“Volatility has affected timing in some cases, but it has not fundamentally altered strategic intent, particularly for large, well‑financed transactions,” said Philipp Beck, UBS’s EMEA head of mergers and acquisitions.
Long-term consequences remain uncertain after this week’s International Monetary Fund warning that worsening conflict could push the global economy toward recession.
“If we get into a recessionary environment, people will need to run more scenarios, and that may delay a little bit some transactions,” Citi’s Baygual observed. “But equally, I can see how the next three years are going to be years of very strong activity, as the fundamentals driving M&A since last year remain.”
