M&A deals have been on the rise in the past few months, as more and more firms aim to strengthen their market presence and leverage on new business opportunities in the post COVID-19 world.

As of the most recent information from Refinitiv, worldwide M&A deal making has already hit more than $3. So far this year, the value of announced deals has reached $6 trillion, which is 24% higher compared to the same period of the previous year and became the new record of the deal-making.

Technology sector remains the most active in terms of M&A transactions, backed by the increasing digitisation of businesses. Cloud computing, cybersecurity and artificial intelligence are the most active segments in terms of M&A, as big players try to strengthen their positions and counter the threats from the innovative new entrants.

Microsoft’s recent $68. The $7 billion acquisition of Activision Blizzard, the gaming company, is another example of the biggest deals in the tech industry, which shows the further merging of gaming, cloud services, and the metaverse.

Pharmaceutical companies in the healthcare industry are in the process of acquiring other companies in order to strengthen their drug portfolios and venture into new areas of treatment. The competition for coronavirus treatments and vaccines has led to more attention to biotech companies with innovative technologies.

Pfizer’s $6. The recent deal of $7 billion acquisition of Arena Pharmaceuticals and Merck’s $11. Such moves include Celgene’s $5 billion acquisition of Juno Therapeutics and Bayer’s $2. 7 billion acquisition of Loxo Oncology as well as the recently announced $5 billion acquisition of Acceleron Pharma.

The energy sector is also going through a phase of M&A due to the shift towards clean energy. Oil and gas giants are snapping up renewable energy projects and EV charging facilities in a bid to transform their businesses and respond to shareholders’ demands for decarbonization. Shell’s $1. The $6 billion acquisition of Ubitricity, the leading European electric vehicle charging company is an example of this.

The financial services are not lagging behind either, with banks and other financial technology companies merging in order to strengthen their position in the digital market. The latest deal of Square, a payment company, acquiring Afterpay, a buy now pay later service, for $13 billion shows how traditional financial services are integrating with new age fintech services.

International M&A activity has also increased, despite the various geopolitical risks and increased regulatory concerns. It is a trend that is seeing firms search for growth and strategic resources in markets outside their domestic markets. Nevertheless, one of the most important issues that continue to hamper many multinational corporations is the ability to chart their way through the maze of rules and regulations, especially in relation to transactions that involve strategic assets or activities such as technologies and infrastructures.

Deal making activities have remained strong and private equity firms have been one of the key drivers of this growth as they sit on record levels of unspent capital and take advantage of low interest rates. There has been an increase in the number of large buyout deals for instance the $34 billion acquisition of Medline Industries by a consortium of private equity firms, which shows the increased interest in mega deals in the current market.

The rise in the M&A has also seen enhanced focus from the antitrust authorities across the globe. In the United States, the Federal Trade Commission and Department of Justice have shown an increased enthusiasm in merger reviews especially in the technology industry. Likewise, the European Commission is scrutinizing the proposed transactions for the competitive issues which has resulted in longer time periods for review and in some cases, the deals are called off.

Thus, as the M&A environment changes, the emphasis is shifting towards ESG factors in the process of transactions. Buyers are focusing more on the environmental concerns and social responsibility of the target firms, which is a testimony to the fact that these factors are becoming more relevant to investors and customers.

Moving forward, M&A practitioners anticipate that the M&A market will continue to be active in the next few months due to the recovering economy, availability of capital, and the fact that organisations need to transform in response to new market conditions. Nevertheless, there are certain factors that may affect the deal making sentiment in some sectors or in specific geographies including inflation, interest rates and geopolitical risks.