Dealmaking activity shows Trump tariffs derailed a budding M&A boom
The Mergers and Acquisitions (M&A) landscape in the U.S. is showing signs of recovery after a brief setback caused by the Trump administration’s tariff policies. The year started off strong, with a promising outlook for dealmaking, fueled by the administration’s pro-business stance and deregulatory agenda. However, the announcement of tariffs led to market volatility and a slowdown in activity.
Fortunately, after Trump suspended the highest tariffs and market conditions stabilized, dealmaking picked up pace once again. With more clarity on trade policies and rebounding equity markets, the stage is set for a resurgence in M&A activity. According to Kevin Ketcham, a mergers and acquisitions analyst at Mergermarket, even sectors heavily impacted by tariffs are expected to see increased deal activity.
In March, the total value of U.S. deals exceeded $227 billion, with 586 deals taking place. Although April saw a temporary slowdown, May has seen a rebound in activity, with over 300 deals valued at more than $125 billion. This uptick in activity is a positive sign for the M&A market.
Despite the temporary slowdown, Charles Corpening, chief investment officer of private equity firm West Lane Partners, anticipates a pickup in M&A activity post-summer. He notes that higher bond yields are currently affecting activity in the U.S. by increasing financing costs. However, he expects interest to grow in special situations M&A and smaller transactions, which are easier to finance and face less regulatory scrutiny.
Several major deals have already been announced this year, particularly in tech, telecommunications, and utilities. Notable transactions include the acquisition of Foot Locker by Dick’s Sporting Goods and Kraft Heinz’s evaluation of potential transactions to unlock shareholder value. These deals signal a shift towards smaller transactions that adapt to the new macroeconomic environment.
Overall, the M&A landscape in the U.S. is showing signs of recovery and resilience. While challenges remain, the market is poised for continued activity and growth in the coming months. Stay tuned for more updates on the evolving M&A landscape.
