USA TRENDS AND DEVELOPMENTS Contributed by: W. Todd Carlisle, John H. Cooper, R. Michael Murphy and David W. Drum, Dentons
Dentons 2311 Highland Avenue South Suite 500 Birmingham, Alabama 35205 USA
Tel: +1 205 930 5100 Fax: +1 205 930 5101 Email: marketing.us.dsp@dentons.com Web: www.dentons.com
Introduction The pace and volume of mergers and acquisitions (M&A) transactions in the United States substantial - ly improved in 2025 following a less robust level of activity in 2024 and a decade-low level in 2023. The return to a more robust level of activity was driven by a combination of: • a shift in the antitrust regulatory environment under new leadership at the Federal Trade Commission (FTC) and Department of Justice (DOJ); • interest rate reductions; • deployment of capital by private equity firms; and • momentum from corporate acquirers following several years of uncertainty. Most practitioners entered 2026 with an optimistic outlook on the M&A environment in the United States, driven by the strong ending to 2025 and the expec - tation that the momentum would carry over into the new year. In short order, however, this optimism was tempered by uncertainty related to the impact of an evolving tariff regime, followed by the material geopo - litical risks arising from the Iran conflict and its impact on the energy markets. The Supreme Court’s decision in Learning Resources, Inc et al v Trump striking down tariffs imposed under the International Emergency Economic Powers Act provided greater clarity with respect to a portion of the tariffs imposed by the Trump administration. Any momentum resulting from the Learning Resources decisions was subsequently dampened by further escalation of the Iran conflict, ongoing shifts in tariff policies, dislocations in the private credit markets, and conflicting views of the direction of monetary policy in
the United States. Market participants must test the view that private equity distribution pressure will accel - erate exit activity in 2026 against the complex web of monetary policy considerations and geopolitical risks threatening to dampen any potential momentum that might arise from a wave of strategic exit transactions. M&A Activity in 2025: A Year of Recovery Corporate and private equity deal makers had much to celebrate at the close of 2025 as a result of a mate - rial increase in the overall volume of M&A activity, particularly with respect to the so-called mega-deals in excess of USD5 billion in value, driven in part by significant shifts in the antitrust enforcement environ - ment in the United States. The momentum at year-end was tempered somewhat by a lower level of activity in the sub-USD500 million segment of the market, as a result of continuing challenges in monetary policy and the private credit markets as well as the related capital constraints in the middle market. The recovery in transaction volume accelerated throughout 2025, moving from a slow start in the first quarter (as market participants assessed the impact of the Trump admin - istration’s policy priorities) to a more robust pace and volume of transactions in the third and fourth quarters of 2025. M&A activity in the technology sector generated the highest level of transactions, driven by AI-related acquisitions, further consolidation in the cybersecurity sector, and continuing platform expansions by estab - lished technology companies. Momentum in the ener - gy and power sector represented the second highest level of transactions in 2025, followed by healthcare and life sciences, financial services, and industrials and materials, where shifts in tariff and trade policies
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