04.2 - Trends and Developments in European Mergers & Acquisitions

• Geanina Gabriela Prodan

  Alexandru Ioan Cuza University

  Author

• Mihaela Onofrei

  Alexandru Ioan Cuza University

  Author

The European mergers and acquisitions market has undergone a significant transformation, influenced by economic, political and technological factors, becoming a means of adapting to new economic and geopolitical circumstances. Digitalization, sustainability and the energy transition have redefined the motives for transactions as well as the selection of target companies. The war in Ukraine and the general economic and political instability have affected the business environment through small value acquisitions to recover certain industries and strengthen technology, healthcare and renewable energy. Since 2024, the volume of European deals has declined but the total value has increased by 31% as investor confidence has returned. The market has been dominated by deals in the technology sector, namely IT and telecoms amid accelerating digitization growth and the adoption of emerging technologies such as cloud computing or big data. The gradual stability of the macroeconomic backdrop is narrowing the buyer-seller valuation gap. Strategic investors were in the majority as both buyers and sellers. The study aims to highlight developments and trends in M&A transactions at the European level, over the period 2017-2025, depending on the source and frequency of data reporting. The evolution of economic activity has a cyclical character, where periods of intense activity are followed by stagnation, with an impact on investor behavior. Trading dynamics highlight global declines in values but in terms of numbers, European trading has been boosted by the strategic opportunities created by Brexit and the depreciation of sterling. The crisis generated by the Covid-19 pandemic has reduced investor interest in European assets, necessitating a strategic reorientation. Deal structures indicated increased confidence in the stability of target companies, reflected in a reduction in the use of price adjustment mechanisms and earn-out clauses.