I am really struggling to create a multi line equation that incorporates both a matrix and a single equation that lines up the equals signs such as the one below:

So far have done the following:
\begin{equation*}
M = U\Sigma V^{*}
\end{equation*}
\begin{equation}
= \textbf{U}\left[ \begin{array}{cccc}
\sigma_{1} & 0 & \ldots & 0\\
0 & \sigma_{2} & \ldots & 0\\
\vdots & \vdots & \ddots & \vdots\\
0 & 0 & \ldots & \sigma_{m}\\
\end{array} \right]\textbf{V*}
\end{equation}

amsmathenvironments asalign(in your case.equationscan be used only for one line equations!. – Zarko Apr 09 '16 at 14:16