The mergers and acquisitions (M&A) landscape is poised for a significant upswing in 2025, according to Deloitte’s latest M&A Trends Survey. As we delve into the findings, it’s clear that dealmakers are not just optimistic but are actively preparing for a surge in activity, despite the persistent uncertainties in the global economic environment.
Key Findings from Deloitte’s 2025 M&A Trends Survey
Deloitte’s 11th annual M&A Trends Survey, which captured insights from 1,500 U.S.-based executives, reveals a remarkably positive outlook for the coming year. The survey highlights several key trends:
- Increased Deal Volume: A staggering 79% of corporate leaders and 87% of private equity executives expect the number of deals to grow in 2025.
- Larger Deal Sizes: Nearly three-quarters of respondents anticipate an increase in average deal size or value over the next 12 months1.
- Sector-Specific Optimism: Financial services and private equity sectors lead in M&A outlook, with 87% of respondents in each industry expecting an increase in deal numbers.
Factors Driving M&A Optimism
Several factors contribute to the bullish M&A outlook for 2025:
- Potential Fed Rate Cuts: The possibility of interest rate reductions is boosting dealmaker confidence.
- Business-Friendly Tax Proposals: Anticipated changes in tax policy are creating a more favorable environment for M&A activities.
- Deregulatory Actions: Potential easing of regulations is seen as a tailwind for deal-making.
- Macroeconomic Tailwinds: The survey indicates that macroeconomic factors are likely to prompt increased M&A activity, building on the rebound experienced in 2024.
Industry-Specific Insights
The survey provides valuable insights into industry-specific trends:
| Industry | Deal Volume Expectation | Deal Size Expectation |
|---|---|---|
| Financial Services | 87% increase | 82% increase |
| Private Equity | 87% increase | Not specified |
| Other Industries | Varied | Varied |
Financial services stand out with the highest optimism, expecting both deal volumes and sizes to increase significantly.
Challenges and Adaptations
Despite the optimistic outlook, dealmakers are aware of potential challenges and are adapting their strategies accordingly:
- Strategic Shifts: 88% of corporate respondents and 81% of PE respondents have made significant changes to their deal targeting strategies in the past two years.
- Focus on Core Sectors: Many organizations are narrowing their focus on a smaller number of sectors.
- Internal Restructuring: 84% of corporations and 91% of PE portfolio companies have undergone or are currently undergoing restructuring.
- Alternative Financing: Both corporate (54%) and PE (52%) leaders are looking to non-traditional lenders to finance deals.
Conclusion
As we move into 2025, the M&A landscape appears ripe with opportunities. The Deloitte survey paints a picture of a market where dealmakers are not just optimistic but are actively preparing for increased activity. While challenges remain, the adaptability and innovation demonstrated by M&A leaders suggest a dynamic and potentially lucrative year ahead for mergers and acquisitions.