M&A Market Slump is Global, Sounding Warning Bell for Future Deal Making in 2019

North American companies making M&A deals, on average, lost shareholder value during the second quarter of 2019, underperforming the MCSI North America Regional Index by –3.7 percentage points (pp). Further, for the first time in over a decade companies making M&A deals in every region worldwide, on average, lost shareholder value, underperforming the World Index1 by –6.3 pp. According to the latest results from Willis Towers Watson’s Quarterly Deal Performance Monitor (QDPM) — run in partnership with Cass Business School — the global M&A market has now underperformed for an unprecedented seven consecutive quarters.

Source: Willis Towers Watson | Published on June 27, 2019

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For the first time in five years there were no completed megadeals in Q2 2019 (those valued at over $10 billion). North American deal volumes were essentially flat for the quarter, and all global geographic regions underperformed their respective indices. Asia Pacific acquirers showed the worst performance of all regions with underperformance of –7.9 pp, followed by European buyers at –4.1 pp. Europe now remains the only region where acquirers are still outperforming the index for both the one-year and three-year rolling periods.

“M&A activity is a barometer of business confidence. The rapid drop in deal volume in the last six months, especially in the U.S. market, suggests the impact of geopolitical, trade and tariff uncertainties has been brutal, fueling board room uncertainty around the world,” said Duncan Smithson, senior director, M&A, Willis Towers Watson. “Until there is less turbulence in the markets there is a good chance that even fewer deals will be announced in the second half of 2019, underscored by more stringent regulations, protectionism and political uncertainty, which continue to frustrate deal making.”

Based on share-price performance, deal volumes were at the lowest level since Q2 2009 for any second quarter, with 144 deals completed so far in Q2 2019.2 This is attributed to a flat volume of deals in North America (lowest since Q2 2009), Europe and Asia Pacific (lowest since Q2 2013).

“Corporate clarity will continue to be a key theme driving M&A activity, as pressure increases on companies to review their business structures and assess how best to unlock value from deals,” said Smithson. “Digital disruption will also be a major factor shaping the market, as large companies attempt to assimilate technology to become more efficient and better reach end users by buying boutique firms, resulting in fewer billion-dollar megadeals.”

Willis Towers Watson QDPM methodology

All analysis is conducted from the perspective of the acquirer.

Share-price performance within the quarterly study is measured as a percentage change in share price from six months prior to the announcement date to the end of the quarter.

All deals where the acquirer owned less than 50% of the shares of the target after the acquisition were removed, hence no minority purchases have been considered. All deals where the acquirer held more than 50% of target shares prior to the acquisition have been removed, hence no remaining purchases have been considered.

Only completed M&A deals with a value of at least $100 million that meet the study criteria are included in this research.

Deal data sourced from Refinitiv.

About Willis Towers Watson M&A

Willis Towers Watson’s M&A practice combines our expertise in risk and human capital to offer a full range of M&A services and solutions covering all stages of the M&A process. We have particular expertise in the areas of planning, due diligence, risk transfer and post-transaction integration, areas that define the success of any transaction.

About Willis Towers Watson

Willis Towers Watson is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 45,000 employees serving in more than 140 countries and markets. We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals. Our unique perspective allows us to see the critical intersections between talent, assets and ideas — the dynamic formula that drives business performance. Together, we unlock potential.


1. The M&A research tracks the number of completed deals over $100 million and the share-price performance of the acquiring company against the MSCI World Index, which is used as default unless stated otherwise.
2. The QDPM research for Q2 2019 includes deals completed between April 1, 2019, and June 14, 2019. We anticipate the current number of deals of 144 to increase by quarter end.