Global dealmaking falls under $1 trillion in the third quarter

Worldwide mergers and acquisitions totalled $993 billion in the third quarter, down 41 percent from the second quarter, LSEG data showed on 1 October. It was the first quarter under $1 trillion since the second quarter of 2025. Ten deals above $10 billion were announced in the quarter, the fewest megadeals since the fourth quarter of 2024. Banca Monte dei Paschi's $32 billion bid for Banco BPM and Gold Fields' $25.7 billion bid for Northern Star Resources were two of them.

The quarter does not wipe out the year. From January through September, global M&A was up 28 percent at $3.9 trillion, the highest total for that stretch since 2001. The number of deals fell 8 percent, to a count last seen in 2020. More money, fewer transactions: the year is being carried by large deals signed earlier, not by a wide market. The third quarter is where that pattern broke.

Where the volume went

Asia was the exception inside the quarter. M&A there reached $242 billion, up 8 percent from the second quarter and 36 percent from a year earlier. Strategic purchases of technology stakes accounted for 24 percent of global M&A. That share is the clue to what is still clearing boards. A company buying a stake in a technology firm can move with less debt than a full takeover of a bank or a miner. The two megadeals that did get announced, an Italian bank bid and an Australian gold bid, are old-economy combinations that do not need a story about artificial intelligence to explain them.

The borrowing-cost explanation is the one Reuters' report led with, and it needs a number next to it. The 10-year US Treasury yield touched 5.34 percent this week, the highest since 2002. A buyer financing a $10 billion deal at that rate pays a coupon the 2021 market did not. John Collins, global head of M&A at Morgan Stanley, told Reuters that higher yields make valuations a little tougher at the margins, and that the effect is hard to quantify. He said he was not ready to call a slowdown on the evidence in front of him. The LSEG table calls the quarter. Collins declines to call the cycle. Both can be true for one earnings season.

What a sub-trillion quarter changes for bankers

League tables are built on announced value. A 41 percent drop against the previous quarter moves bonuses, hiring and the pitch books that went out in June. It does not, by itself, cancel deals already signed. Monte dei Paschi's bid for BPM and Gold Fields' bid for Northern Star still have to clear regulators and shareholders. A bid announced is not cash paid. The $993 billion figure counts announcements. The 8 percent drop in the number of deals counts how many boards were willing to sign anything.

The 2001 comparison on the year-to-date total is a volume comparison, not a market comparison. 2001 was the year the dot-com bust showed up in the deal count. 2026 is a year of high completed volume and a sudden thin quarter. The useful split is Asia against the rest. A region up 36 percent year on year, inside a global quarter down 41 percent, means the slowdown is concentrated in the markets where the 10-year yield sets the price of debt. European and American boards that needed a bond issue to close a megadeal had ten such deals to point to, and a market that did not want an eleventh at the September rate.

The figure to watch in the fourth quarter

If the fourth quarter stays under $1 trillion, Collins' reluctance to call a slowdown runs out of road. If it rebounds, the third quarter reads as a pause while buyers waited on the yield. The inputs are already public: a 5.34 percent 10-year, ten megadeals, Asia at $242 billion, technology stakes at 24 percent of the global total, and a year that is still the largest since 2001 only because the first half was. The $993 billion is the number that broke the trillion-dollar run. It is also small enough, against a $3.9 trillion year, to be reversed by two large announcements before December.