The total number of transactions in the first quarter of 2024 dropped 8.2% from the previous quarter to 3,765, the lowest quarterly transaction total in nearly four years. March proved a particularly difficult month for dealmaking, with steep year-over-year declines for both deal volumes and the total value of transactions.
Still, transaction values have followed a largely positive trajectory since mid-2023 and were up 144.7% and 100.7% in January and February. The total value of US and Canadian deals amounted to $378.25 billion in the first quarter of 2024, down from $434.13 billion in the previous quarter but greater than all other quarterly deal values since the second quarter of 2022.
Oil and gas deals in focus
Despite muted first-quarter M&A activity and smaller transactions compared to dealmaking levels over the previous three years, several notable deals did take shape, even amid less attractive financing conditions.
Building on a trend that defined the biggest deals of 2023, the oil and gas industry remained at the forefront of M&A with three of the quarter's largest deals.
Diamondback Energy Inc.'s acquisition of Endeavor Energy Resources LP was the industry's most significant first-quarter deal at $25.79 billion. Strong year-end balance sheets among major producers had led analysts to believe an acquisition of the company was imminent, one of several likely targets in a wave of industry consolidations.
The first quarter's largest deal came from the banking sector, with Capital One Financial Corp.'s $35.34 billion deal for Discover Financial Services. The proposed acquisition would represent the largest US bank deal in over 15 years and remains subject to regulatory approval.
Sector activity
The number of M&A deals decreased steadily throughout the first quarter across all but the materials sector. The consumer sector saw a particularly precipitous decline, with the number of deals dropping 56% from January to March.
In terms of aggregate transaction values, March was the weakest month of the quarter for financials; healthcare; energy and utilities; and technology, media and telecommunications.
The greatest number of deals originated from the industrials sector in the first quarter at 674, followed by the technology, media and telecommunications sector with 653, and the consumer sector with 429. The three sectors also saw the most deals announced in the previous quarter.