2024 M&A Year in Review - Flipbook - Page 72
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2025 M&A Outlook
Following encouraging trends during the second half of 2024, the M&A
landscape is poised to continue its resurgence over the course of 2025, even
though lingering political and economic uncertainty, particularly in the
early part of the year, could temper momentum.
While dealmaker and C-suite optimism may be chilled by concerns over the
potential impact of increased tariffs, persistent inflation, slower economic
growth, and stagnant interest rates, several factors indicate that positive
M&A growth will emerge during the balance of 2025.
Regulatory hurdles will not disappear, but they are expected to ease under
new administrations, fostering a more deal-friendly environment in the
United States, the United Kingdom, and the European Union. Resolution of
trade arrangements and the possibility for settlement of international
conflicts would likely bolster boardroom and C-suite confidence,
encouraging corporate buyers to pursue acquisitions as a means to achieve
strategic goals.
Private equity M&A activity should experience an uptick during the second
half of this year as a record amount of dry powder drives increased
dealmaking by sponsors. PE firms will seek exit opportunities for
uncharacteristically long-held portfolio companies in order to return profits
to their investors. An exit boom could increase the number of prospective
targets for strategic buyers.
Dealmakers are likely to continue to leverage joint ventures, strategic
partnerships, and other alternative structures to bridge valuation gaps and
to propel growth without the need for a full-ownership acquisition. We also
anticipate strong deal activity across strategics and sponsors in the
consumer, energy, financial services, life sciences and health care, and
technology sectors.
We expect increased levels of transactional activity to unfold over the course
of this coming year, overcoming the near-term uncertainties presented by
shifting economic and diplomatic policies of new administrations.
