Amid rising interest rates, ongoing fears of a global recession, inflation concerns, volatile share prices, financing market dislocations, geopolitical conflicts and other developments, deal value in the first quarter of 2023 was the lowest for any first quarter in 20 years. The full year saw a 17% decline in global M&A activity compared to 2022. It marked the first year since 2013 that global M&A volume failed to cross the $3 trillion threshold, and represented only 50% of peak 2021 deal value of $5.8 trillion. Transactions involving U.S. targets and acquirers continued to represent a substantial percentage of overall deal volume, with U.S. M&A exceeding $1.26 trillion in 2023 (approximately 44% of global M&A volume), as compared to about $1.5 trillion in 2022 (roughly 43% of global volume).

Despite the overall slowdown in M&A markets, a number of transformative transactions—including several megadeals—were struck. The energy sector saw the two largest deals of the year: Chevron’s $53 billion agreement to acquire Hess and Exxon Mobil’s $59 billion agreement to acquire Pioneer Natural Resources, both announced in the fourth quarter. Only two other deals crossed the $25 billion threshold: Pfizer’s purchase of Seagen for $43 billion and Cisco’s agreement to acquire Splunk for $28 billion. These four $25 billion-plus deals compare to six such deals announced in 2022 and 10 in 2021. Similarly, there were 30 $10 billion-plus deals announced in 2023, against 32 in 2022 and 52 in 2021. As in 2022, a significant number of companies turned to separations, divestitures, carve-outs and spin-offs, with nearly 200 $1 billion-plus divestitures and spin-offs announced.

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