Global terminated M&A deals totaled $15.96 billion across 29 transactions in the fourth quarter of 2023, the lowest quarterly tally since 2020, according to data from S&P Global Market Intelligence.

However, deals backed by private equity or venture capital firms, either as seller or buyer, comprised 17.2% of the total volume, the highest quarterly proportion since at least the first quarter of 2020.

For full year 2023, terminated deals worldwide, including whole company and minority stake acquisitions and asset deals, were worth $150.60 billion, with private equity backers involved in about $28.16 billion, or approximately 19%, of the total value.

The volume of terminated transactions closed at 392, with 42 deals, or about 10.7%, involving private equity.

– Download a spreadsheet with data featured in this story. – Read about trends in global venture capital funding rounds in 2023. – Read the latest on private equity investments in China's semiconductor industry.

Among the five private equity-backed deals that failed to close in the fourth quarter, one transaction involved a private equity firm as a buyer. In the other four transactions, private equity firms were the sellers.

'Look before you leap' strategy

The decreasing number of terminated deals seems to align with the sluggish dealmaking activity in 2023, as a valuation gap between buyers and sellers, the high cost of debt and regulatory concerns slowed M&A.

"The recent deal climate has rewarded a 'look before you leap' strategy," Alexandra McCormack, a partner at law firm Skadden, said in a written comment.

Buyers and sellers have been reaching agreement on the value of assets "and buyers are building more room for error into their valuations. At the same time, parties are front-loading the work to identify and propose solutions for antitrust issues. One result, especially in competitive processes, is fewer busted deals," McCormack added.

Largest terminated transactions

In 2023, there were seven canceled private equity-backed deals worth at least $1 billion. Some of these deals fell apart due to antitrust regulation hurdles and misaligned valuation between buyers and sellers.

The largest among the terminated deals was the canceled sale of Allfunds Group PLC to Euronext NV, valued at $5.92 billion. The supposed seller was an investor group including Hellman & Friedman LLC and BNP Paribas SA.