It may surprise some that after a year combatting a global pandemic, companies are buying and selling at unexpected rates, and M&A experts don’t expect a slow-down anytime soon. A report from Refinitiv states that as of June, global activity was up 158% over the same prior year period. And with current backlog of activity, the rest of the year is projected to be very active.
What’s driving all of this activity? According to the U.S. Dept of Commerce, the GDP increased at an annual rate of 6.5% in the second quarter of 2021, signaling continued economic recovery. Adjusted for inflation, we are back to pre-pandemic levels. To add a little perspective, after the last recession ended in 2009, the GDP took two years to fully recover.
The stock market is driving confidence and interest rates remain at record lows, making borrowing cheap. With strong consumer spending and investment 2021 could turn out to be a record-breaking year for M&A.