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Goldman Sachs believes global mergers and acquisitions activity is on course for one of its strongest years in history, with transaction volumes potentially approaching the record levels reached during the dealmaking boom of 2021.
On the surface, the comparison is straightforward. Deal activity is rising, confidence is improving and corporate buyers are returning to the market.
Yet the similarities may end there.
The conditions that fueled the record-setting M&A environment of 2021 no longer exist. Interest rates remain elevated compared with pandemic-era lows, regulators have become more aggressive in scrutinizing large transactions and geopolitical tensions continue to complicate cross-border dealmaking.
M&A may be rebounding, but the rules governing the market have changed.
The shift is becoming more apparent as companies pursue acquisitions to secure growth, strengthen competitive positions and gain access to technologies that would be difficult or time-consuming to develop internally.
Strategic logic matters more than cheap money
The M&A surge that followed the pandemic was fueled in part by exceptionally low borrowing costs and abundant liquidity.
Companies could access financing on favorable terms, private equity firms deployed record amounts of capital and buyers were often willing to pay premium valuations in pursuit of growth.
The current environment looks very different.
Financing remains available, but it is no longer inexpensive. Companies now face greater pressure to justify acquisitions through a clear strategic rationale rather than financial engineering alone.
This helps explain why strategic corporate buyers have become the dominant force in the market.
Speaking at a recent industry conference, Goldman Sachs President John Waldron described the current environment as a corporate-led market. Rather than relying on leverage to drive returns, many buyers are pursuing acquisitions that expand market share, strengthen supply chains, provide access to emerging technologies or support long-term growth objectives.
Artificial intelligence offers a clear example. Companies seeking specialist capabilities, proprietary software or valuable data assets often view acquisitions as the fastest route to securing a competitive advantage.
The emphasis has shifted from whether a transaction can be financed to whether it can create lasting strategic value.
Regulatory scrutiny begins before a deal is announced
The regulatory landscape has evolved significantly since the last major dealmaking cycle.
Competition authorities in the US and abroad have adopted a more interventionist approach toward mergers, particularly in sectors involving technology, healthcare, infrastructure and other strategically important industries.
Regulatory considerations now influence deal strategy much earlier in the process.
Potential antitrust concerns, foreign investment reviews and national security considerations are often assessed before companies advance serious discussions with potential targets. In some cases, regulatory risk shapes whether a transaction proceeds at all.
Cross-border acquisitions present additional challenges.
Governments around the world have expanded their oversight of foreign investment, while geopolitical tensions continue to affect transactions involving strategic technologies, critical infrastructure and sensitive supply chains.
Identifying an attractive target is only one part of the equation. Understanding the regulatory path to completion has become equally important.
Certainty carries a premium
A stronger M&A market does not necessarily mean an easier one.
As transaction volumes increase, sellers are placing greater emphasis on certainty of execution. Financing commitments, regulatory preparedness and transaction structure can influence outcomes as much as headline valuation.
This marks a notable shift from previous periods of intense deal activity, when abundant capital often allowed buyers to compete aggressively on price alone.
Today, execution risk remains a significant concern.
Valuation expectations remain difficult to align in some sectors, while financing markets continue to respond to changes in economic conditions and monetary policy. Buyers must also account for the possibility of extended regulatory reviews and more demanding approval processes.
The result is a market where certainty can become a competitive advantage.
Companies that can demonstrate a credible path to completion may find themselves in a stronger position than competitors willing to offer higher valuations but carrying greater execution risk.
Growth remains the priority, but the playbook has changed
Despite the challenges, companies are returning to acquisitions for familiar reasons.
Many industries continue to face slower organic growth, intense competition and pressure to improve efficiency. Acquisitions remain one of the fastest ways to enter new markets, acquire capabilities and strengthen competitive positions.
What has changed is the framework through which those decisions are being made.
The market is no longer defined by easy capital and rapid execution. Strategic fit, regulatory outcomes and transaction certainty now play a larger role in determining which deals move forward and which remain on the drawing board.
The recovery extends beyond mergers and acquisitions. Capital markets activity is beginning to improve, while a stronger IPO environment is creating additional opportunities for companies pursuing growth and restructuring initiatives.
Together, these developments point to a more active transaction market than many expected at the start of the year.
A different kind of M&A cycle
Goldman Sachs’ forecast suggests dealmaking could approach levels not seen since the record-breaking conditions of 2021.
Yet the comparison can be misleading.
The market that produced those records was shaped by cheap financing, abundant liquidity and a relatively straightforward regulatory environment. The recovery taking shape in 2026 is unfolding under a different set of conditions.
Companies are still pursuing acquisitions. Capital remains available. Competition for attractive assets is still intense.
The difference is that success now depends on more than ambition alone.
Strategic rationale must be clearer, regulatory risks must be understood earlier and execution must be planned more carefully. Those realities may not prevent dealmaking from reaching historic levels, but they are reshaping how transactions are evaluated, structured and completed.
M&A may be rebounding. The rules, however, have changed.
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