The overall value of mergers and acquisitions (M&A) deal activity in the global aerospace and defense sector in 2019 was up sharply in 2019 due to the pending combination of United Technologies [UTX] and Raytheon [RTN] although there were slightly fewer deals than in 2018, PwC says in its year-end review and analysis of M&A activity.

PwC also provides an outlook for M&A activity in the sector, suggesting continued strength.

Deal value was up 62 percent to $93.8 billion in 2019 and was 2.5 times the 10-year average, PwC, a global auditing, consulting and professional services firms says in the report issued on Thursday. The average deal size was up 68 percent to $539.2 million, 2.3 times the 10-year average, it adds.

The UTC and Raytheon merger, which is expected to close in the first half of this year, is valued at $52 billion.

The number of deals declined 4 percent to 447 in 2019 versus 464 in 2018, PwC says.

Spending on defense and commercial air travel remains robust, pointing to positive trends going forward, PwC says. It highlights the announcement this month of aerospace and defense suppliers Woodward [WWD] and Hexcel [HXL] merging in a $6.6 billion deal as getting 2020 “off to a good start.”

“Strong defense spending and commercial air travel trends appear to be supporting confidence in deal making and we see that confidence continuing into Q1 2020 absent any major heightening in the recent Middle East tensions or other geopolitical developments,” the report says.

The potential impact of Brexit and the 2020 U.S. presidential election are “significant unknowns,” PwC says.

PwC expects private equity investments, which were strong in the fourth quarter, to continue to help propel deal activity moving forward.

“The fourth quarter especially saw an uptick in financial investors leading deal value, which is a strong indicator of attractiveness of the industry and would lead us to expect private equity to continue seeking opportunities permitted by relatively strong valuations,” PwC says.

C4ISR, defense modernization, and original equipment manufacturers expanding into the commercial aftermarket space are “certain bright spots” for deal activity this year, PwC says.