M&A Expected to Slow Ahead of US Elections Following Mixed Third Quarter Reports By Reuters

By Anirban Sen

NEW YORK (Reuters) – Dealmakers are preparing for a slowdown in global mergers and acquisitions (M&A) during the fourth quarter as companies hold off on pursuing significant targets ahead of the U.S. elections. Many hope this pause is only a temporary setback before a resurgence in activity next year.

Here are insights from investment bankers and M&A lawyers regarding the short-term outlook for dealmaking:

TOM MILES, GLOBAL CO-HEAD OF M&A, MORGAN STANLEY

"We haven’t observed any deals exceeding $50 billion lately. Historically, such large transactions are common and typically boost overall deal volume. The absence of these big deals is largely attributable to existing regulatory pressures, making it challenging to conclude large transactions across various sectors. While there have been a few substantial deals in the energy sector recently, industries like healthcare and technology haven’t seen many sizeable transactions.

On the other hand, there has been a strong number of deals in the $1 billion to $20 billion range. This year has not been slow in that segment, with corporates actively engaging in multiple deals within those brackets. Although some may argue that market activity is weak, the reality is it remains vibrant, with companies continuing to invest in M&A."

ERIC TOKAT, CO-PRESIDENT OF INVESTMENT BANKING, CENTERVIEW PARTNERS

"I expect 2025 to be a vigorous year for M&A. There’s considerable activity across various sectors. The challenge is identifying which projects evolve into significant deals, but the momentum looks promising. Currently, our outlook for the deal pipeline is more optimistic than it was a few quarters ago."

JAY HOFMANN, CO-HEAD OF M&A, NORTH AMERICA, JPMORGAN

"Companies are eager to pursue substantial, innovative deals but will proceed cautiously over the next few months, prioritizing low-risk opportunities. The current environment has buyers seeking to align their transactions with strategic goals."

FRANK AQUILA, SENIOR M&A PARTNER, SULLIVAN & CROMWELL

"There is heightened M&A activity, as it has become a top priority for many clients. This is largely because the U.S. economy is poised to be stable—not necessarily thriving, but certainly not weak—over the coming year. Consequently, boards and management teams aren’t overly worried about an imminent recession. Coupled with potential interest rate cuts, conditions are favorable for deal-making.

We are likely to see an uptick in acquisitions by European and Japanese companies focusing on the U.S. market, as they recognize the potential for significantly greater revenue and profit growth here compared to their domestic markets. We can anticipate increased cross-border transactions, especially inbound M&A in the U.S. This trend suggests further consolidation in sectors such as healthcare, financial services, and technology. Signs indicate a strong finish for 2024 and a robust start to 2025."

ADAM EMMERICH, CO-CHAIR OF WACHTELL LIPTON’S CORPORATE DEPARTMENT

"There’s considerable uncertainty about what either the Republican presidential candidate or the Democratic rival would mean for different facets of the regulatory environment. Most of the deals currently being negotiated are expected to close under a new administration."

EAMON BRABAZON, CO-HEAD OF EMEA M&A, BANK OF AMERICA

"There has been a marked increase in both the speed and types of deals. A wide range of strategies is currently being employed, which is a positive indicator. Over the next few years, we can anticipate higher-than-average levels of sponsor exits, potentially surpassing historical peaks."