A&O Shearman has released its latest biannual M&A report, offering a comprehensive analysis of global dealmaking trends in 2024 and forecasts for 2025, which includes a so-called ‘Trump bump’ in dealmaking in the year ahead following Trump’s inauguration.
The A&O Shearman report, authored by the firm’s partners and associates, provides valuable insights into four key areas shaping the M&A landscape, drawing on their extensive expertise across multiple sectors.
Trump Administration’s Impact on M&A
The report examines the potential effects of the Trump administration on M&A activities, foreign investment screening, and merger reviews in the United States. Dealmakers have reportedly greeted Donald Trump’s election win with optimism, suggesting a potentially favorable environment for M&A transactions.
U.K. Public Markets Attracting U.S. Bidders
A significant resurgence in transatlantic public M&A has been observed during 2024. The report highlights a substantial increase in deal value, with transactions worth USD15.2 billion recorded in the year to October, nearly doubling the total for 2023.
This trend underscores the continued attractiveness of U.K. public markets to U.S. bidders. However, the report also cautions about the high number of failed bids, emphasizing the need for careful navigation of the unique features of the U.K. takeover regime to ensure transaction success.
Private Equity Exit Market Recovery
After facing challenges in realizing asset valuations over the past 12 months, the private equity sector shows signs of recovery. The report’s authors express optimism for the PE exit market as we move into 2025, suggesting a potential upturn in activity and valuations.
Draghi’s Vision for European M&A Regulations
The report explores Mario Draghi’s ambitious proposals to reshape Europe’s merger control landscape, as outlined in the Draghi report on EU competitiveness. These recommendations aim to foster growth and competitiveness within the European Union. The analysis delves into the likelihood of this vision becoming a reality and its potential impact on the broader M&A landscape.
Expert Commentary
David Broadley, (above) global co-head of M&A at A&O Shearman, provides insightful commentary on the report’s findings. He emphasizes the impact of global elections and geopolitical uncertainties on M&A markets, noting that the arrival of President Trump in the White House and the implications of the Draghi report will have repercussions beyond their respective geographic boundaries.
Broadley predicts a highly competitive M&A landscape in 2025, with continued U.S. interest in U.K. listed companies.
However, he cautions that bidders need to understand the intricacies of the U.K. takeover regime to avoid bid failures. This underscores the importance of expert guidance in navigating complex cross-border transactions.
Looking Ahead
The report suggests that despite challenges faced in 2024, there are positive indicators for the M&A market moving into 2025. The potential recovery in the PE exit market and the sustained demand from U.S. entities for U.K. listed companies are particularly noteworthy trends.
A&O Shearman’s global network of M&A experts remains committed to delivering valuable insights and opinions on the factors shaping dealmaking. Their comprehensive analysis and forward-looking perspectives make this report an essential resource for understanding the evolving M&A landscape and preparing for the opportunities and challenges that lie ahead in 2025.
