August 3, 2026 – The 2026 FIFA World Cup recently concluded as the most successful soccer (football?) tournament yet. Featuring nearly 7 million spectators across 104 matches and estimated global engagement as high as 5 billion people, the World Cup’s cultural influence is undeniable.
While the United States men’s national soccer team’s advance to the Round of 16 was respectable, ultimately, the team’s performance ended below expectations (they were generally expected to make a quarterfinal appearance). In contrast, the Canada men’s national soccer team performed far above expectations in reaching the Round of 16, which was a notable result for a country that had never previously advanced from the group stage.
In comparison to their similar results in the World Cup, merger market activity in each country presents a striking contrast.
In last month’s memo, A Bull Market for Dealmakers, we stated that “the booming U.S. public M&A market is on track to exceed 2025’s record year of $1.1 trillion.”
The trend of robust public U.S. merger and acquisition volume continued into July, with 18 deals announced worth an aggregate $63.3 billion – in line with the historical average. While the rare jumbo M&A deal did not occur during the month, the merger tally was dominated by small cap transactions in the $1 billion to $10 billion range.
While it is unsuitable to expect the Canadian M&A market to match that of its much larger southern neighbour, an appropriate benchmark would be 1/13th of the activity, given this figure represents the size differential of their respective economies.
This approximation makes sense in terms of historical averages, as the Canadian merger market has seen an average of 2.82 deal announcements per month over the past five years.
Alas, Canadian deal activity did not live up to expectations in July, with zero transactions announced in the month. As the U.S. merger market booms, Canada’s remains mired in a deal drought.
Typically, deal droughts correspond with significant negative macro events and their corresponding spike in volatility. While certain macroeconomic and market-wide incidents remain active, including the seemingly never-ending war in Iran along with the recent vicious reversal in momentum stocks, overall equity market volatility remains benign – an environment conducive for corporate dealmaking activity.
Moreover, deal flow remained consistent in the U.S. special purpose acquisition company market in July. SPAC initial public offering activity continued at an above-average pace, with 18 SPAC IPOs coming to market, raising nearly $4 billion. Additionally, there were 10 SPAC mergers announced through the month, worth a total of $11.2 billion.
While a zero public M&A deal month in Canada is not unprecedented, as these have occurred in eight months out of the past five years (13.3% of the time), it is discouraging to see when the U.S. market is so robust (it makes you wonder – did Canadian investment bankers take the whole month off?).
Nevertheless, similar to the country’s above-expectations performance in the 2026 FIFA World Cup, hopefully Canada’s merger market can bounce back and showcase a banner year with deal activity that surprises to the upside.
The AlphaRank.com Merger Monitor below represents Accelerate’s proprietary analytics database on all announced liquid U.S. mergers. The AlphaRank Merger Arbitrage Effective Yield represents the average annualized returns of all outstanding merger arbitrage spreads and is typically viewed as an alternative to fixed income yield.
Each individual merger is assigned a risk rating:
- AA – a merger arbitrage rated ‘AA’ has the highest rating assigned by AlphaRank. The merger has the highest probability of closing.
- A – a merger arbitrage rated ‘A’ differs from the highest-rated mergers only by a small degree. The merger has a very high probability of closing.
- BBB – a merger arbitrage rated ‘BBB’ is of investment grade and has a high probability of closing.
- BB – a merger arbitrage rated ‘BB’ is somewhat speculative in nature and has a greater than 90% probability of closing.
- B – a merger arbitrage rated ‘B’ is speculative in nature and has a greater than 85% probability of closing.
- CCC – a merger arbitrage rated ‘CCC’ is very speculative in nature. The merger is subject to certain conditions that may not be satisfied.
- NR – a merger-rated NR is trading either at a premium to the implied consideration or a discount to the unaffected price.
The AlphaRank merger analytics database is utilized in running the Accelerate Arbitrage Fund (TSX: ARB), which may have positions in some of the securities mentioned.
* AlphaRank is exclusively produced by Accelerate Financial Technologies Inc. (“Accelerate”). Visit Alpharank.com for more information. Disclaimer: This research does not constitute investment, legal or tax advice. Data provided in this research should not be viewed as a recommendation or solicitation of an offer to buy or sell any securities or investment strategies. The information in this research is based on current market conditions and may fluctuate and change in the future. Accelerate does not accept any liability for any direct, indirect or consequential loss or damage suffered by any person as a result of relying on all or any part of this research and any liability is expressly disclaimed. Accelerate may have positions in securities mentioned. Past performance is not indicative of future results.
