Mergers and acquisitions (M&A) increased sharply in the first quarter of this year, reaching a monetary value that was the highest since 2007. Deals totaled $902.2 billion in Q1, with transactions valued at $1 billion or more accounting for nearly 70% of all mergers and acquisitions, CNBC reported.

“I think it’s a forward-looking barometer in the sense that people engage in more M&A when they have an expectation of either stability or better growth going forward,” said Scott Sperling of private equity firm THL Partners, on CNBC. “One of the things you’ve seen is a level of comfort among large strategic players with this stability they’re seeing in the marketplace for the foreseeable future.”

Better stability is one factor in the M&A surge, but so is the challenge to produce consistently higher revenues, according to Sperling. With large companies finding organic growth more difficult to achieve, they’re turning to mergers and acquisitions – which they can sometimes finance at interest rates as low as 2%. “Obviously the math works really well at reasonably high multiples from a stock accretion perspective if you can do that,” he said.

The Financial Times reported this month that U.S. companies are expected to return a record $1 trillion to investors in the form of buybacks and dividends in 2015, up $904 billion over last year. Capital spending and sales gains, though, remain generally muted. “The significant increase in corporate leverage and lending is not being used in the pursuit of organic growth but is instead being used for financial engineering,” Vadim Zlotnikov, chief investment strategist at AllianceBernstein, told FT.

Within the ad specialty space, where distributors grew sales by 3.5% in Q1, major deal-making also appears to be picking up, as well. Last month, Staples Inc., the parent company of Staples Promotional Products (asi/120601), agreed to acquire Canada-based Accolade Promotion Group (APG, asi/102905) for an undisclosed amount. Staples Promotional Products is the largest distributor of ad specialty items in North America, while APG ranks 21st on Counselor’s Top 40 list. Counselor estimates that the combined promotional products revenue of Staples and APG will surpass $500 million annually.