06 Apr 2023

Sullivan & Cromwell tops M&A rankings in Q1 as deal making tumbles to decade low

First quarter deal value is lowest since 2013 and slowest quarter since the start of the pandemic, according to Refinitiv

Deal making drops 44% compared to opening three months of 2022 Shutterstock

Sullivan & Cromwell topped the global M&A legal advisor rankings by deal value in the first quarter of the year as deal activity slumped to the lowest in a decade, according to Refinitiv’s Q1 Global M&A Review.

Sullivan & Cromwell worked on 38 deals worth $99bn to claim the top spot, holding off Wachtell Lipton Rosen & Katz in second place, which advised on 17 deals worth $84bn. Goodwin Procter ($76bn), Skadden Arps Slate Meagher & Flom ($73bn) and Kirkland & Ellis ($59bn) completed the top five by deal value.

Global M&A activity slowed significantly in the first three months of the year, with $580bn of deals – the lowest opening quarter since 2013. That was a 44% drop on the opening three months of 2022 and the largest year-on-year percentage decline since 2001. It was the slowest quarter for global dealmaking since the second quarter of 2020 when markets ground to a halt due to the coronavirus pandemic.

Julian Pritchard, head of global transactions at Freshfields Bruckhaus Deringer – which was the highest ranked UK firm in 10th spot, having advised on just under $41bn of deals – said: “The macro environment has led to significantly compressed M&A volumes across geographies as the uncertainty has impacted valuations and conviction levels. The recent challenges in the financial sector are likely to have an additional dampening effect.”

Some regions were harder hit by the slump than others. In Europe, M&A activity cratered to a 26-year low, with deal values falling by 60% to $90bn – less than the total value of global deals that Sullivan & Cromwell advised on alone.

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In Asia Pacific, deal values dropped 23% to just under $145bn. The US accounted for almost half of all deal making in the first half of the year (47%), with $273bn of deals – though that is still a significant drop on 2022 levels (also 47%). Mega deals (those valued at $10bn or more) declined by half to $113bn, the lowest value of mega deals since 2014.

The number of deals also fell in the first quarter, with 12,700 transactions announced, almost a fifth lower than the same period in 2022. 

Goodwin Procter topped the rankings by deal count, working on 172 transactions. Kirkland was second with 122 deals, while Latham & Watkins was third with 94 deals. White & Case and Fasken Martineau DuMoulin completed the top five with 79 and 77 deals respectively.

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