Mergermarket's new release: Global Mergers and Acquisitions Trends and Potential Risks Report
In a recent report published by a global law firm in collaboration with Mergermarket, Raj Karia, the Global Head of Corporate, M&A and Securities, highlights a shift towards more deliberate and strategic planning in M&A. The report, titled the Global M&A Trends and Risks for 2025, provides legal advice on a wide range of matters, including public transactions, strategic review processes, joint ventures, and acquisitions.
Key Trends
The report emphasizes several key trends and risks in global M&A for 2025, focusing on resilience amid uncertainty, regional variations, and evolving strategic considerations.
Resilience and Optimism Amid Uncertainty
Despite significant macroeconomic, geopolitical, and policy volatility, global M&A activity has remained robust. Companies are pursuing deals driven by consistent, profitable growth and premium valuations. Business confidence has improved due to prospects of tariff policy resolutions in the US and improving economic outlooks in key regions, supporting optimistic deal volumes and counts, especially in the second half of 2025.
Regional Activity Differences
While M&A volumes in North America and EMEA show considerable resilience and cautious optimism, specific sectors and regions manifest varied dynamics. For example, EMEA deal volumes rose by about 11% year-on-year, whereas North American deal activity cooled somewhat in Q2 2025 due to economic policy uncertainty and elevated interest rates affecting financing costs.
Sector-Specific Movements
Insurance M&A experienced a decline in global deals in H1 2025, attributed to geopolitical uncertainty, inflation concerns, and high valuations, plus reduced private equity interest. In contrast, the financial services sector saw a rise in M&A activity in Europe and Asia Pacific for H1 2025, with increased disclosed deal values primarily driven by large deals (over $1 billion).
Strategic Deal-making Adaptation
Companies are adopting more nuanced, creative, and courageous deal-making strategies to navigate uncertainty. Sophisticated understanding of supply chains and external risks is key, enabling M&A as a lever to diversify supply chains or customer bases amid geopolitical shifts.
Key Risks
The report also identifies several key risks that dealmakers should be aware of.
Geopolitical and Policy Risk
Continued geopolitical uncertainty (such as US tariffs and global tensions) creates cautiousness among dealmakers, especially in cross-border and insurance-related deals, influencing a more defensive posture focused on domestic or smaller-scale transactions.
Economic and Inflationary Pressures
Inflation concerns, market volatility, and economic turbulence are dampening deal appetite in some sectors and regions, with high valuations causing carriers and other players to conserve capital rather than pursue large acquisitions.
Interest Rate Environment
Elevated interest rates and uncertainty about the trajectory of US Treasury yields complicate financing conditions for M&A, particularly in North America, impacting deal volume and timing decisions.
Valuation Challenges
Persistently high asset valuations create a risk of deal breakdowns or deterring new transactions, as buyers become more cautious and sellers less flexible, as observed notably in insurance M&A.
Expectations for 2025
Taken together, the 2025 outlook stresses a complex environment requiring adaptability, strategic precision, and awareness of evolving risks, with the overall market showing selective growth amid these challenges.
44% of survey participants expect domestic private equity buyers to be among the most active types of acquirers in deal markets in 2025. Domestic strategic buyers are expected to be the most active acquirers, particularly in emerging markets like Latin America, Africa, and South and Southeast Asia.
53% of respondents expected their organization's appetite for M&A to increase in 2025 compared to last year, but market turmoil caused by reciprocal tariff announcements decreased their appetite.
Contact Information
For further information, Louise Nelson, Head of PR for Europe, Middle East, and Asia, can be contacted at Tel: 44 20 7444 5086 or Cell: 44 79 0968 4893. Alternatively, Dan McKenna, US Director and Global Head of PR and Communications, can be reached at Tel: 1 713 651 3576.
The survey included responses from 100 executives from multinational corporations, 50 from large private equity firms, and 50 from major investment banks.
The report also notes that 65% of respondents expect the use of representations and warranties insurance (RWI) to increase in 2025 compared to 2024, with more than 45% of respondents in the Middle East and South and Southeast Asia forecasting a significant increase. Additionally, 51% of respondents have acquired an AI business, and 46% report that they are looking to acquire an AI business in the near term.
The team is involved in some of the most significant transactions in the market. With more than 450 M&A partners and 700 other deal lawyers worldwide, they advise on high-profile, complex, and significant transactions.
In line with the report's findings, businesses are leveraging technology to adopt more strategic and creative deal-making approaches, integrating sophisticated understandings of supply chains and external risks (finance, business, technology). On the other hand, economic and inflationary pressures, geopolitical uncertainties, and interest rate environments pose significant risks to M&A activities in 2025 (finance, business, technology).
