The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.

All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.

Investment banking: Is the mega-deal M&A party over?

A string of jumbo strategic corporate deals made 2018 one of the busiest years ever in M&A, but falling equity markets, slowing economies, rising debt costs and geopolitical uncertainties have now dimmed the outlook severely. M&A bankers hope that private equity buyers, with $1 trillion of equity to put to work, will pick up the baton and that activist investors will stop corporate executives from quietly jamming those takeover and disposal plans back into the freezer.


On the last Sunday of October, IBM announced the biggest M&A deal in its history, agreeing to acquire Red Hat, the world’s leading provider of open-source cloud software, for $190 per share. That’s a 64% premium to the target’s previous closing price and values Red Hat at $34 billion, with the consideration to be paid in cash.

IBM has had to suspend its share buyback programme for the next two years to finance the deal from available funds and debt without threatening its single-A rating or the steady dividend policy, for which many retail investors hold the stock, rather like a low-risk utility play.

Refinitiv, the financial data company formerly known as Thomson Reuters, was quick to note that the deal pushed announced global technology M&A in the first 10 months of 2018 up to $422.2 billion, 59% ahead of the same period in 2017.

“Technology developments will continue to underpin M&A across most industries, including autos, industrials, retail, media and telecom,” says Adrian Mee, co-head of global M&A at Bank of America Merrill Lynch.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree