Competition Among Corporate, Private Equity And SPAC Buyers Intensifies

The analysis examines current global deals activity and incorporates insights from PwC’s deals industry specialists to identify the key trends driving M&A activity, and anticipated investment hotspots for the remainder of 2021 and into 2022. 

The first six months of 2021 saw record levels of dealmaking both in terms of deal volumes and values, notably setting a record growth of global deal values in excess of US$1 trillion per quarter over the past 12 months. Fresh capital inflows led by SPACs have been an important catalyst, plus an increase in private equity (PE) investment and corporate acquisitions – particularly focused on technology assets.

SPACs, in particular, catapulted the megadeals (deals with values over US$5 billion) announced during the first half of 2021. A third of announced megadeals in the last six months had a SPAC buyer and an outsized proportion of those (almost 90 percent) involved bolstering technology capabilities.

A record 274 new SPACs were listed in the first quarter, raising over US$80 billion during the first half of 2021, more than the amount raised during the whole of 2020. While the creation of new SPACs has slowed, there remain almost 400 existing ones that have yet to identify an acquisition target. PwC analysts estimate that these SPACs possess nearly a half trillion dollars in buying power, with existing capital and leverage combined, for M&A over the next two years – the bulk of it to be invested by the end of 2022.