All year long, the merger and acquisition community has been bemoaning the paucity of mega-cap deals. Then comes October and ... boom! Three transactions that classify as "mega" vault into the ranks of top 10 deals for the year.
The roster for the month includes AT&T (T) agreeing to buy Time Warner (TWX) , which not only leaps to the top of the year's tote board of deals, at $108.7 billion, but enters the ranks of the five biggest mergers in history.
To give their due to the investment bankers who are distressed by the perceived disappearance of mega-cap deals, it should be noted the aggregate value of M&A transactions has, in fact, fallen by more than one-third through the first 10 months of the year, October's wave of big deals notwithstanding.
Why? It could be argued the M&A market was doomed as soon as we flipped the page on the calendar to Jan. 1, 2016. Fundamentals had actually begun to sour months earlier.
Remember that the public markets were besieged with an antic dose of volatility beginning last August: The VIX doubled in a 10-day period that month. The credit markets retreated. All of a sudden the relentless battle that greed wages with fear turned in favor of the latter.
So rather than coming into 2016 with the momentum of a runaway freight train after two consecutive years of record mergers, the M&A market entered the year on crutches.
There was the Brexit, global terrorism, a GDP reading that struggled for a "2" handle. Then there was uncertainty over the direction of interest rates. The presidential election is getting hairier the closer we get to the second Tuesday in November.
All those factors are temporary because in little more than a week, we'll know the outcome of the election and in a month, we'll have some clarity on rates.
But what is a more permanent feature when it comes to the M&A market is multiples. Asset holders, having witnessed more than two years of "sky's the limit" for transaction prices, gave the same answer that Edward G. Robinson's character says motivates him in Key Largo: More.
So what changed in October?
The easiest answer would be that this is an anomaly rather than the start of a trend. Whether that analysis is on the money or not won't be resolved until later this month, if not the end of the year.
There's also the fact that a lot of weird things happen in October, and we're not just talking about the Donald Trump costumes on Halloween night.
Mutual funds close their books on the year in order to calculate their tax exposure. The public markets go from the dreadful month of October to what's historically the beginning of the best six months of any investment cycle.
Look at the three mega-cap deals topping the October M&A chart: in addition to AT&T/Time Warner, there's Qualcomm (QCOM) annexing NXP Semiconductors (NXPI) for $47 billion, and CenturyLink (CTL) bolting on Level 3 Communications (LVLT) at $34 billion.
The common characteristic: each of them are transactions among strategics.
By contrast, in October the roster of the top 10 deals includes exactly one transaction executed by a private equity firm: Blackstone Group (BX) buying TeamHealth Holdings for $6 billion -- and that one qualifies for 10th place. In 2014, when the carousal of M&A deals accelerated, financial sponsors spent half a trillion dollars on acquisitions.
In short, the M&A market here in 2016 is kind of limping because PE firms, mindful of what took place in the aftermath of the 2007 spending boom, are showing discipline.
Maybe the absence of competition in auctions from financial sponsors will be enough to put some pressure on multiples in the last two months of the year. Maybe the fortitude of PE firms will waver by Thanksgiving, and financial sponsors will wade back into the surf of M&A.
But the October bulge in mega-cap deals, at least for now, looks like more of a coincidence than the start of a trend.
EDITOR'S NOTE: This article was originally published by The Deal, a sister publication of TheStreet that offers sophisticated insight and analysis on all types of deals, from inception to integration. Click here for a free trial.