Transactions
The value of everything
13 Feb 2025
Insight
US
All eyes are on the US as we await further detail on what the Trump administration will bring to the M&A table. Despite improving economic conditions in 2024, M&A activity somewhat waned in the latter half of the year with the uncertainty arising from the country awaiting its election results. While Trump’s impact is rarely described as predictable, 2025 is nevertheless expected to bring a new level of economic optimism, sparking more mega deals and an overall increase in M&A activity.
2024 in review
The US continues to account for the vast majority of deals in the Americas with nearly 90% of regional deal value and 75% of volume in 2024, and over 45% of global deal value and close to 25% of volume in 2024.
While total deal value in the US during 2024 was up year on year with an improving US economy, a turbulent political landscape, high interest rates and increased regulation saw a decline in the number of deals announced by more than 18%.
The number of deals over $1 billion rebounded in 2024 to over 270. A challenging US and global regulatory landscape has caused a significant delay in the completion of these mega deals. The $35 billion acquisition by Synopsys of engineering software company Ansys (announced in January 2024), while cleared in the EU, remains under investigation in the US, China, and the UK (though with recent provisional Competition and Markets Authority approval based on undertakings offered by the companies). Similarly, the $35 billion merger of Capital One and Discover announced in February 2024 remains under investigation in accordance with US antitrust and federal banking laws (though, with the new administration’s pro-business stance, it is expected to be approved in early 2025).
Financial sponsors continue to be an important part of the M&A ecosystem in the US, directly involved in 40% of deals in 2024. This trend is expected to continue and likely grow under a Trump administration.
Expectations are that M&A activity in tech will remain strong in 2025 with continued investor enthusiasm for AI bolstered by the signals Trump sent in the first day at the White House by launching, with OpenAI, Softbank and Oracle, $500 billion Stargate. "
Sectors in focus
The tech industry regained the top spot in 2024 by both total deal value (with over 20%) and volume (with over 25%) overtaking energy (with around 16% by total deal value). Expectations are that M&A activity in tech will remain strong in 2025 with continued investor enthusiasm for AI bolstered by the signals Trump sent in the first day at the White House by launching, with OpenAI, Softbank and Oracle, $500 billion Stargate.
Other industries in focus include the energy industry, particularly in light of the president’s recent declaration of a US “energy emergency” and “drill, baby, drill” cry in his inauguration speech. The oil and gas industry is more optimistic, but still somewhat cautious given the unpredictable nature of Trump’s as yet undetailed policies. Trump also announced plans to abolish tax credits for electric vehicles and roll back other incentives relating to climate change initiatives. This could hamper some activity particularly as the auto industry has already invested heavily in the research, development and production of electric vehicles. However, such damage may be limited, at least with respect to domestic and inbound focused M&A, by a continued focus on onshoring manufacturing capabilities.
Trump takes power – What next?
Inheriting improving economic conditions, a newly-elected Trump administration is expected to bring with it an overall business-friendly environment, leading to an increase in activity particularly in energy (especially oil and gas), finance (including virtual currencies) and tech. Many expect tax cuts, deregulation and a more predictable pro-deal merger review process, all positive signs pointing towards an increase in deals.
A generally optimistic market is balanced with a mix of scepticism given certain already announced policies which may inhibit global businesses (such as plans to increase import tariffs), coupled with a fear of Trump’s unpredictable nature.
Dealmakers eagerly await further information as to the specifics of new policies, sparking a need to be agile and flexible in an uncertain political landscape in which we must expect the unexpected. Some businesses may choose to wait out further news to understand how Trump's tariffs policy will affect them. Others are expected to capitalise on already in-play strategies to expand into US onshore manufacturing.
Despite some scepticism and uncertainty surrounding Trump's policies, 2025 is shaping up to be a year of continuing rebound in M&A in which we are likely to see continued growth.
Key contacts
Chapters
- Global M&A Outlook 2025 – Regional perspectives
- Africa – Still uncertain but hopeful
- Asia – Bright spots
- Australia – High on value
- CEE and Central Asia – Mixed results
- Europe – Slow but steady
- France – Resilience amid uncertainty
- Germany – Dreams of spring
- India – From strength to strength
- Italy – Volume down, value up
- Latin America – The only way is up
- Luxembourg – Set for a rebound?
- Middle East – Progress amid tensions
- South Korea – Mixed signals
- Spain – Gaining momentum
- Switzerland – Cautiously optimistic
- UK – At a turning point?
- US – What Trump 2.0 means for M&A
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© Herbert Smith Freehills 2025
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