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Global M&A Reaches $2.6 Trillion in 2025, Driven by AI and Growth Ambitions

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Global mergers and acquisitions (M&A) have hit $2.6 trillion in the first seven months of 2025 — the highest level since the pandemic-era peak of 2021 — as companies prioritize growth and capitalize on opportunities in artificial intelligence (AI). Despite a 16% drop in the number of transactions compared to last year, total deal value rose 28%, fueled by large-scale U.S. transactions exceeding $10 billion.

Key deals include Union Pacific Corp’s proposed $85 billion takeover of Norfolk Southern and OpenAI’s $40 billion funding round led by SoftBank. These transactions mark a shift from early-year hesitation caused by U.S. tariffs and geopolitical uncertainty, as renewed boardroom confidence and a clearer regulatory environment spur activity.

Industry experts say the M&A landscape is now heavily growth-oriented, with AI adoption and regulatory changes prompting companies to move quickly to avoid falling behind. Compared to August 2021’s $3.57 trillion, current activity is still down 27%, but bankers expect more large deals in the second half of 2025 as executives adapt to market volatility and post-election policy direction.

Healthcare dominated post-pandemic dealmaking, but over the past two years, technology and electronics have taken the lead. AI-driven needs, such as data center infrastructure and cybersecurity, are major drivers — highlighted by Samsung’s $1.7 billion purchase of FlaktGroup and Palo Alto Networks’ $25 billion acquisition of CyberArk. Private equity has also re-entered the market, with major bids like Sycamore Partners’ $10 billion move to take Walgreens Boots Alliance private and competing offers from KKR and Advent for UK firm Spectris.

The U.S. remains the world’s largest M&A market, representing more than half of global deals, while Asia Pacific’s activity doubled from last year, surpassing the pace of EMEA growth.

Musk’s xAI Eyes $170-$200 Billion Valuation in Upcoming Funding Round, Financial Times Reports

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Elon Musk’s artificial intelligence company xAI is reportedly preparing to raise additional capital in a funding round that could value the firm between $170 billion and $200 billion, according to the Financial Times, citing sources close to the discussions. Saudi Arabia’s Public Investment Fund (PIF) is expected to play a significant role in the round, holding an indirect stake in xAI through its investment in Kingdom Holdings Company, which has put $800 million into the AI startup.

The discussions are still preliminary, and details may evolve, the report noted. Musk himself responded on X, stating that xAI is not currently seeking funding and has sufficient capital. PIF did not immediately comment on the report.

Previously, in June, Morgan Stanley disclosed that xAI completed a $5 billion debt raise along with a separate $5 billion strategic equity investment. The company is aggressively expanding its AI infrastructure with new data centers amid increasing competition in the sector.

xAI acquired X (formerly Twitter) in March, valuing the AI firm at $80 billion and X at $33 billion. Musk founded xAI in July 2023 to compete with OpenAI’s ChatGPT, which recently announced plans to raise up to $40 billion at a $300 billion valuation.

According to projections shared by Morgan Stanley, xAI expects to generate over $13 billion in annual earnings by 2029 and anticipates $1 billion in gross revenue by the end of this year. The company also plans to invest $18 billion in data center expansion going forward.

Huawei aims to expand role in Brazil’s data center market amid pending tax incentives

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Chinese technology giant Huawei has expressed interest in strengthening its position as a supplier of data center solutions in Brazil, Reuters reported on Thursday. While Huawei clarified it does not plan to invest directly in data centers, the company is keen to provide connectivity, storage, and energy solutions for the growing market.

Huawei’s Latin America and Caribbean Vice President of Public Relations, Atilio Rulli, emphasized the importance of the Brazilian government implementing upcoming tax-break incentives designed to attract tech investments. “We want the government to implement these incentives, which are good for the country, and the time has to be now,” he said.

Brazil, Latin America’s largest economy, is working to build a strong data center industry leveraging its abundant renewable energy resources. The government’s tax-break plan is expected to be sent to Congress soon, according to a finance ministry adviser.

The country has already attracted attention from major players such as ByteDance, TikTok’s parent company, as part of its digital infrastructure expansion.

Huawei reaffirmed its commitment to supporting Brazil’s digital transformation with reliable, scalable, and sustainable data center solutions once government incentives come into force.