Tax Cut Cash, Cheap Money Fuel M&A Boom

May 03, 2018 - The $26.5 billion merger between Sprint and T-Mobile is the latest mega-deal in what's on course to be a record year for M&A activity.
In the first three months of 2018, there were 3,774 deals worth $890.7 billion, up 18% from a year ago, according to Mergermarket. Dealmaking in Europe was particularly strong, with volume doubling from the same time last year.
The healthcare industry sector has been the most active, with $156 billion in deals during the first quarter.
The activity comes as big companies try to compensate for the expiration of patents on blockbuster drugs by acquiring smaller companies with promising pipelines.
Other forces driving M&A are low interest rates, which makes it inexpensive for companies to borrow money to pay for deals, as well as the U.S corporate tax cut, which has freed up billions of dollars in cash for those companies that don't want to borrow. M&A activity was a record $3.8 trillion in 2015.