M&A is having its best year in half a decade.
But it's a boom with a catch - almost all the action is at the top.
According to a new PwC report, global mergers and acquisitions are on track to hit $4 trillion in 2026. That would be the strongest showing since 2021, when deals topped $5 trillion.
The megadeal takeover
Megadeals - transactions worth more than $5 billion - are driving nearly half of that total. Their share of global deal value has jumped from 26% in 2024 to 39% last year and now 48%.
"2026 is the year M&A supersized," said Brian Levy, global deals industries leader at PwC US.
If the pace holds, megadeal values could rise 40% this year alone. Meanwhile, the rest of the market is barely moving.
We break down what's fueling the surge - and where the opportunities are hiding - in Market Briefs. It's five minutes each morning, plus a free investing masterclass when you sign up.
AI writes the big checks
Artificial intelligence is the common thread in this year's biggest deals.
SpaceX just agreed to buy AI startup Cursor for $60 billion. Salesforce is snapping up AI customer-service platform Fin for $3.6 billion. And Qualcomm is reportedly in talks to acquire chip firm Modular for around $4 billion.
PwC says AI is creating a "K-shaped" M&A market - one where the biggest players get bigger, and everyone else struggles to keep up.
The middle market squeeze
Smaller dealmakers face a wall of headwinds. Geopolitical uncertainty, stubbornly high interest rates, inflation, and a backlog of private equity exits are all making mid-market deals harder to close.
"Many mid-market dealmakers remain constrained," PwC noted. The result: a two-speed market where the headlines are all about megadeals, but the engine of everyday M&A is sputtering.
What to watch
PwC believes AI could eventually make private markets more liquid by helping investors evaluate and trade assets faster. But for now, human judgment still runs the show.
If rates stay high and uncertainty lingers, the gap between megadeals and the middle market could widen even further.
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