Global deal activity slows in early 2025

India’s M&A market remains resilient

In early 2025, the global deal market experienced a slowdown, with a 9 pc decline in overall deal volume year-on-year. Despite the global challenges, India’s M&A landscape has flourished, with deal values increasing by 43.2 pc to reach USD 36.14 billion by November 2024.

According to a recent report by GlobalData, the global deal market has slowed down in early 2025, with overall deal volume falling by 9 pc year-on-year (YoY).

This decrease is seen across mergers and acquisitions (M&A), private equity, and venture financing, all of which have experienced drops in activity in the first two months of 2025 compared to the same period in 2024.

Europe, in particular, has seen a sharp decline in deal-making, largely due to economic challenges and geopolitical uncertainties. However, some regions have shown resilience despite the global slowdown, with India, Japan, and the UAE standing out as markets where deal activity has remained strong.

India’s M&A landscape

Among the resilient markets, India has emerged as a significant player, particularly in the M&A sector.

According to the data published by Forbes India, India’s M&A landscape experienced a significant resurgence, with deal values reaching USD 36.14 billion by November 2024, a 43.2 pc increase from USD 25.24 billion in 2023. Deal volumes also rose by 24.4 pc during this period.

This surge was driven by both domestic and inbound deal activity, particularly in sectors such as Technology, Media and Telecommunications (TMT) and Pharmaceuticals, where India has seen increased investment interest from both foreign and local players.

“The global competitive environment and a large young population have made India, an active space for investment, especially when compared to regions experiencing economic slowdowns, tariff burdens, or rigid regulatory environments,” Ramanand Pandey, Director, Centre of Policy Research and Governance (CPRG), an independent, non-profit think tank  based in Delhi, tells Media India Group.

Several notable M&A deals in India in 2024 included the merger of  Reliance Industries and Disney in February 2024, creating a joint venture valued at USD 8.5 billion.

Similarly, in March 2025, Ambuja Cements, owned by the Adani Group, received approval from India’s antitrust watchdog for its USD 451 million acquisition of Orient Cement and in December 2024, Ambuja Cements also announced plans to merge Penna Cement and Sanghi Industries into the company.

“India is witnessing an upward trend in M&A activities, the focus should be on increasing government investments in the domestic market to attract global players. It should tap into all the potential agreements to make it a financially strong country. With continued economic expansion and supportive government policies, M&A activity is expected to remain robust. Sectors like aerospace and agritech are anticipated to attract investments, offering new opportunities for M&A activities,” says Pandey.

Alongside traditional M&A, private equity and venture capital activity has also risen in India. The country’s growing startup ecosystem has attracted significant interest from private equity firms and venture capitalists.

Sectors like fintech, edtech, and e-commerce have particularly benefited from this investment, with startups receiving funding to expand their operations. This influx of capital has added another layer to the M&A activity in India.

In 2024, VC investments surged by 43 pc year-on-year, reaching USD 13.7 billion across 1,270 deals. Notably, consumer technology, software and SaaS (including generative AI), and fintech sectors collectively attracted over 60 pc of this funding, says a report by Bain & Company, a consultancy, and IVCA, a non-profit, apex industry body promoting the alternate capital industry.

“Indian tech startups specialising in AI, analytics, and cloud-based software (SaaS) are prime targets for global acquisitions,” says Pandey.

Several factors have contributed to this growth. First, India continues to attract foreign investment, especially from global players looking to tap into the country’s large consumer market and expanding economy.

The retail and consumer vertical led in deal volume during the first quarter of the financial year 2024, with 81 deals.

The country’s rapid digital transformation has also played a major role in driving M&A activity. The growth of e-commerce, fintech and digital services in India has created significant opportunities for companies to acquire new technologies and expand their digital capabilities.

The government’s push for digitalisation, alongside the growing adoption of new technologies, has further encouraged investment in India’s tech space.

In addition to the digital shift, recent policy reforms have helped improve India’s business environment. The Indian government has made efforts to streamline regulations, simplify tax laws, and encourage foreign direct investment (FDI).

“Government policies are also encouraging domestic production and have led to mergers between Indian firms and global defence players,” says Pandey.

In the April-June quarter of 2024, the Indian pharma and healthcare sector saw 55 deals totaling USD 4.1 billion. This marked an eight-fold increase in deal values and a 10 pc rise in deal volumes compared to the previous quarter.

“The global demand for affordable generics and vaccines has made India’s pharma industry a hotbed for M&A activity. Many firms are acquiring biotech companies to boost R&D capabilities and large hospital chains are expanding through acquisitions to cater to increasing healthcare needs, especially in Tier II and Tier III cities. The rise of digital health platforms, teleconsultations and AI-driven diagnostics has led to strategic mergers between tech firms and healthcare providers,” he adds.