The global M&A boom is rolling into 2026 as AI sparks deal frenzy — but cash is getting tight

• Mega-deals over $5 billion accounted for 73% of the increase in deal value, with 60 deals exceeding that threshold in 2025, the highest since 2021
• The proportion of capital allocated to M&A hit a 30-year low in 2025 as competing priorities like AI capital expenditures diverted funds, with U.S. hyperscalers spending an average of $760 million per day on AI infrastructure
• Private equity now represents roughly 40% of global M&A activity, while private credit markets valued at $2.1 trillion are expected to double by 2030, providing alternative funding sources

Global M&A Boom Continues into 2026 Amid AI-Driven Deals and Capital Constraints

Key Findings

Global M&A activity surged 40% to $4.9 trillion in 2025, marking the second-highest level on record after the $5.6 trillion peak in 2021. The rebound followed a sluggish start due to Trump's early tariff policies but accelerated as central banks cut interest rates and AI investment intensified.

Market Outlook

Survey data indicates strong momentum continuing: 80% of M&A executives expect to sustain or increase deal activity in 2026, while 57% of Goldman Sachs clients cite scale and strategic growth as primary drivers. However, Boston Consulting Group's sentiment index remains at 75—below the long-term average of 100—reflecting cautious optimism.

Capital Constraints

Despite robust deal appetite, the proportion of capital allocated to M&A hit a 30-year low in 2025, as companies prioritized dividends, buybacks, and R&D spending. This represents the tightest funding squeeze in decades, forcing executives to pursue only high-return transactions.

Private equity now accounts for approximately 40% of global M&A activity. The private credit market, currently valued at $2.1 trillion, is expected to more than double by 2030, providing additional deal financing capacity.

AI-Driven Activity

Mega-deals exceeding $5 billion comprised over 73% of 2025's deal value increase, with 60 such transactions—the highest since 2021. AI-related demand is central to this trend, though massive AI infrastructure spending may temper near-term activity. U.S. hyperscalers averaged $760 million daily in capital expenditures between Q1 2024 and Q3 2025.

Goldman Sachs led 2025 advisory rankings with nearly 40 deals totaling $1.48 trillion—the strongest period for mega-deal volume since 1980.