As megadeals hit record levels, the world’s biggest dealmakers are rediscovering a familiar truth of capitalism: in uncertain markets, scale becomes essential for survival.

Global megadeal activity — transactions valued at USD 10bn or more — has surged to its strongest opening on record in 2026, even as geopolitical tensions, uneven capital markets, and economic anxieties weigh on smaller companies and midmarket transactions.

According to Mergermarket data, 31 megadeals worth a combined USD 784bn have been announced globally so far this year, the highest opening tally ever by both volume and value. At the same point last year, there had been 26 megadeals totaling USD 478bn.

Source: Mergermarket, data correct as of 15 May 2026

Driving this year’s surge was OpenAI’s USD 122bn funding round, the largest deal announced in 2026 and the fourth-largest transaction ever recorded by Mergermarket. Only Vodafone AirTouch’s USD 172bn takeover of Mannesmann at the height of the dot-com boom in 1999 ranks higher among all-time deal values.

The momentum builds on a record 2025, when 71 megadeals reached USD 1.48tn. The previous high-water marks came during earlier eras of upheaval and reinvention, including 2015 with USD 1.45tn across 56 deals and 2021 with USD 1.23tn across 59.

Source: Mergermarket, data correct as of 15 May 2026

For advisors at the Milken Institute Global Conference in Los Angeles, the pattern is familiar.

Periods of economic uncertainty, from the dot-com collapse to the global financial crisis and the COVID-19 pandemic, have consistently produced waves of large-scale consolidation as companies seek to secure market leadership and reposition for the next cycle.

The rise in deal activity seems counterintuitive, said Andrea Guerzoni, global vice chair at EY.

But CEOs increasingly view uncertainty as the “new normal,” a condition that has persisted since the COVID-19 crisis and is unlikely to disappear, he said, citing EY’s quarterly surveys of about 1,200 executives.

As a result, “CEOs and boards can no longer afford to stand still,” Guerzoni said. “The old approach of treating crises as temporary, waiting them out, and avoiding risk is no longer viable.”

Wall Street’s new playbook is recasting M&A from a pure growth lever into a tool for resilience and risk management, said Anu Aiyengar, global head of advisory and M&A at JPMorgan.

“It’s a reframing of how to use M&A,” Aiyengar said.

Executives and investors are looking past tariffs, AI disruption, geopolitical conflicts, and private credit concerns to focus on the long term, added Leon Kalvaria, global chairman of banking at Citigroup.

A more permissive regulatory backdrop is also helping drive activity, Kalvaria noted.

There is also significant interest in investing in the US, where valuations are higher. Dealmakers are looking at US targets because they want to put capital to work where it will receive the highest returns, they said.

Go big or go private

Yet beneath the headlines lies a widening divide in corporate America and global capital markets: giant companies are flourishing while smaller firms struggle for relevance, financing, and investor attention.

“The one commonality I see across the equity markets and the M&A markets is scale,” Aiyengar said.

That dynamic has transformed public markets in recent years. The largest companies in the S&P 500 now command an increasingly concentrated share of index value, while valuation premiums for large-cap companies relative to smaller peers have widened to historic levels, she said. The same divide is emerging in M&A. While megadeals are booming, activity below roughly USD 2bn has remained subdued.

“There are a bunch of small companies that are just not suited for the public markets anymore. No one cares,” said Kalvaria. “They’re going to go private.”

Bankers say mid-sized companies are being squeezed from both directions: too small to command premium valuations in public markets, yet often not large enough to attract aggressive buyers or financing.

Publicly traded companies must “go big or go private,” Aiyengar said.

Corporate boards are increasingly willing to pursue once-unthinkable restructurings and combinations to avoid stagnation, according to Kalvaria, who cited McCormick’s USD 40bn pending merger with consumer goods giant Unilever and Paramount’s USD 111bn bid for Warner Bros, as examples.

“We’re going to continue to see transactions that people never dreamed of,” he said.

Companies that fail to adapt risk falling out of favor with investors as markets reward liquidity, scale, and market dominance. Otherwise, “they can end up being left behind,” Kalvaria  said. “Their multiples go down.”

At the same time, dealmakers see opportunity in valuation gaps. Despite broader market strength, roughly one-fifth of listed companies trade at sharp discounts to their 52-week highs and intrinsic values, bankers say, creating fertile ground for strategic acquisitions and take-private deals.

Still, the boom is not evenly distributed.

Alan Tannenbaum, CEO and group head of BMO Capital Markets, said financing uncertainty and geopolitical instability are slowing activity for smaller companies even as large-cap dealmaking remains robust.

Dealmakers are “seeing a much bigger challenge in the smaller and mid-market,” he said.

Companies without strong balance sheets or direct access to capital markets are finding financing harder to secure than before recent geopolitical disruptions, he said. That has delayed but not eliminated many transactions.

“The desire to transact still feels high,” Tannenbaum said. “But we’re seeing delays because of uncertainty in financing models.”

The result is a deal market increasingly defined by extremes: giant companies getting bigger, private capital hunting scale, and smaller firms facing mounting pressure to either consolidate, reinvent themselves, or disappear from public markets altogether.