Key facts
- Barclays PLC's stock price saw a significant increase.
- The rise in stock value is linked to a surge in dealmaking and equity trading.
- Barclays' Global M&A team projects a 15% year-on-year increase in deal volumes for 2025.
- Corporate activity is expected to rise due to pressure to deploy cash balances.
- Sponsor activity in mergers and acquisitions is anticipated to remain strong.
Barclays PLC's stock experienced a notable surge, reportedly jumping 32%, driven by increased activity in dealmaking and equity trading. The bank's investment banking division anticipates a robust M&A market in 2025, projecting a year-on-year increase in deal volumes of up to 15%. This optimism stems from a shift towards a pro-growth environment with potentially less regulation.
Several factors are expected to fuel this dealmaking surge. Continued corporate activity is anticipated, with companies likely to streamline portfolios and capitalize on secular trends. The pressure to deploy substantial cash balances, especially as the Federal Reserve's interest rate target is expected to fall to 3.75-4% by the end of 2025, will make cash a drag on earnings, accelerating the pursuit of growth through mergers and acquisitions. Growth, whether inorganic or organic, is expected to be more highly valued by investors than dividends or repurchases.
Increased sponsor activity is also a key driver. Sponsor activity rose 21% in 2024, contributing over a quarter of total M&A volumes, marking a significant historical contribution. This trend is expected to continue, supported by substantial dry powder, constructive capital markets, and falling interest rates. Sponsors are anticipated to remain active in private auction processes.
Barclays PLC, headquartered in London, operates across five divisions: UK Consumer Bank, UK Corporate Bank, Private Bank and Wealth Management, Investment Bank, and US Consumer Bank. The company traces its origins back to a goldsmith banking business established in 1690. It has a primary listing on the London Stock Exchange and a secondary listing on the New York Stock Exchange.