This year, with the strong resurgence of large-scale merger and acquisition transactions, Goldman Sachs on Wall Street is currently in its best shape in the global M&A market in nearly 24 years, as the company has emerged as one of the biggest winners in this wave of mergers.
According to the latest data from the London Stock Exchange Group (LSEG), the total announced M&A volume worldwide this year amounted to $3.8 trillion, with Goldman Sachs commanding a market share of 34% based on deal value, a significant increase from 28% in 2024. With less than two months left until the end of the year, Goldman Sachs’ market share is poised to equal or even surpass the 34.26% reached in 2015, setting a new record since 2001.
Following the aggregation of data by LSEG, last Friday (November 14th), Goldman Sachs announced the acquisition of biotech company Cidara Therapeutics by Merck for $9.2 billion, which could help drive Goldman Sachs’ market share to exceed the record set in 2015 and reach the highest level since 2001.
M&A activities at the beginning of this year were subdued, but have rapidly picked up steam since, making this year projected to be the most active year for M&A activities since the surge during the pandemic in 2021.
The market has been driven by several mega transactions, with the most notable being the $55 billion privatization of Electronic Arts, the gaming manufacturer.
Currently, the U.S. government has adopted a more laissez-faire attitude towards large-scale mergers and acquisitions, leading to some boards of directors of major companies reviving previously shelved deals.
This year, Goldman Sachs has been involved in many of the largest transactions, boosting market optimism for its future profitability and propelling its stock price to hit a historic high this week.
Despite participating in many large transactions and holding a global market share of 34% based on deal value, Goldman Sachs’ advisory fees fall far short of one-third of the market share. According to Dealogic data, Goldman Sachs’ market share in advisory fees for completed transactions is 10.7%. Nevertheless, this is still the highest level for Goldman Sachs since 2022.
It is worth noting that in this quarter, Goldman Sachs completed its most profitable M&A deal in history, providing advisory services for the privatization of Electronic Arts and earning a $110 million advisory fee.
However, Goldman Sachs only receives the full fee upon completion of the transaction, which typically takes 6 to 12 months from the announcement to finalization.
Stephen Feldgoise, Goldman Sachs’ Global Head of Mergers and Acquisitions, stated that corporate leaders recognize that the current deal environment favors transactions with strong strategic significance. He said, “In the current environment, CEOs are realizing from a capital markets and regulatory perspective that if a deal has strategic value, they should consider it.”
Investment banks such as JPMorgan Chase, Bank of America, and Wells Fargo have significantly increased their market share in the M&A transactions announced this year. Wells Fargo, for example, holds approximately 8% of the announced M&A transaction share this year, rising from 17th place in 2024 to 8th place, achieving its best performance historically.
In contrast, Citigroup’s M&A transaction volume market share has decreased from 17% last year to 13.6% this year, marking its lowest level since 2014.