The global value of mergers and acquisitions has rebounded after a sharp decline following the start of the conflict in Iran, with companies and investors ignoring volatility to carry out larger operations.
The value of announced transactions worldwide in the second week of March dropped to around $39 billion, as American and Israeli strikes on Iran disrupted markets. This marks the lowest weekly level since the announcement of the “Liberation Day” and massive tariffs imposed by the United States last April, according to LSEG data.
However, the total amount of global transactions has since recovered, driven by a series of major operations, including Pershing Square’s $68 billion offer for Universal Music Group and the $45 billion merger between McCormick & Co and Unilever’s agri-food portfolio.
In the four weeks following March 15, the average weekly value of global mergers and acquisitions soared to around $117 billion, surpassing the cruising pace of about $93 billion seen in January and February, according to the data.
“The confidence of executives has somewhat eroded, but the relevance and logic of these corporate transactions remain,” said Guillermo Baygual, global co-head of mergers and acquisitions at Citi.
“The geopolitical dynamics may, at best, add some short-term uncertainty, but in the long term, it further justifies the need to increase critical scale, improve cost efficiency, and strengthen the ability to finance investment expenses that will become almost imperative for generating growth.”
Some regions have been more severely affected by the turbulence. Mergers and acquisitions involving a target in the Gulf totalled nearly $15 billion since the beginning of 2026, a 65% decrease compared to the same period last year, despite a 5% increase in number of announcements.
LSEG identified 70 announced transactions in the Gulf in February, a monthly volume that has only been exceeded once in the region over the past five years. However, in March, after the start of the conflict, only 37 operations were announced, the lowest monthly total since August 2025.
Entities in the Gulf region, however, have been active buyers. The value of acquisitions made by Gulf buyers amounted to $17.1 billion in the six weeks following the start of the war in Iran on February 28. This figure is 244% higher than the six weeks before the conflict, but down 21% from the same period in 2025, according to LSEG.
While the total number of transactions decreased globally, companies continue to pursue large-scale transformation operations.
The number of smaller transactions decreased, potentially hampered by geopolitical tensions and the macroeconomic context, highlighted Nimesh Khiroya, co-head of mergers and acquisitions for EMEA at Goldman Sachs. He suggests that the rebound was fueled by large deals long in the making.
“The large transactions have been in the pipeline for some time and are not a response to the Middle East conflict,” added Mr. Khiroya.
The pace of operations in the equity capital markets (ECM) slowed down after two exceptional weeks immediately following the start of the conflict, during which over $50 billion of transactions were sealed worldwide, according to LSEG data. Global ECM reached $215 billion in the year-to-date until April 14, up 37% compared to the same period last year.
The week immediately following the attacks was the most active of the year in terms of fundraising, some companies and their shareholders seeking investors before markets further deteriorated, three financial advisors told Reuters.
In the four weeks following March 15, the average weekly value of global ECM operations stood at around $11 billion, compared to $13 billion in January and $18 billion in February. This decline is partly due to a slowdown in new equity issuances during the conflict and a traditionally calmer period related to financial results announcements.
Market conditions, however, suggest potential for recovery. The CBOE Volatility Index (VIX), a gauge of investor anxiety, spiked after the conflict erupted at the end of February, but fell below 20 in April. This index, often referred to as the “fear index” on Wall Street, signals stable market conditions when it is below this threshold.
“Volatility has sometimes affected the timing, but it has not fundamentally altered the strategic intentions, especially for well-financed large transactions,” said Philipp Beck, head of mergers and acquisitions EMEA at UBS.
The long-term impact remains to be determined, with the IMF warning this week that the global economy could slide into recession if the conflict escalates.
“If we enter a recessionary environment, players will need to consider multiple scenarios, which could delay some transactions,” concluded Mr. Baygual from Citi. “But in the same way, I believe the next three years will be marked by very active activity, as the fundamentals behind mergers and acquisitions since last year remain intact.”
