FRANCE TRENDS AND DEVELOPMENTS Contributed by: Hugo Sanchez de la Espada, Véronique Millischer, Olivia Chriqui-Guiot, Robin Gaulier and Aurore Cormary, Baker McKenzie
EUR4.6 billion acquisition of Amundi IM and Ferrero’s acquisition of CPK (Carambar). These large transactions show continued interest from European and Asian buyers, as well as the ability of the French M&A market to attract significant foreign capi - tal, even amid global uncertainty. However, although the number of inbound deals announced reached a record high, their combined value declined by 20% to the lowest level since 2013 − further highlighting the downward trend in valuations on the French M&A market. Outbound M&A activity by French companies par - ticularly gained momentum in the first three quarters of 2025, with outbound acquisitions totalling around EUR47 billion − a 27% increase and the highest level since 2021. French corporates actively sought growth abroad, as shown by Sanofi’s EUR8.4 billion acquisi - tion of Blueprint Medicines in the USA and BPCE’s majority stake acquisition in Portugal’s Novo Banco for EUR6.4 billion. These trends underscore both the resilience of the French and European M&A markets and the willingness of French investors to pursue international expansion, even in a complex global environment. Regulatory changes In terms of recent regulatory changes, the French Competition Authority introduced a “pact of trust” to simplify antitrust screening procedures for straightfor - ward transactions, enabling them to be notified with - out the need for pre-notification. At the same time, the French government has proposed a draft bill (Draft bill No.ECOM2409377L) that raises the merger con - trol notification thresholds. This change is expected to reduce the number of deals subject to antitrust review by 25–30%. The bill is currently in its final parliamen - tary stage, but the current political context is slowing down its adoption. In addition, following the ECJ’s decision in the Illu - mina/Grail matter, the French Competition Authority is considering adopting new directives that would ena - ble it to review transactions in strategic sectors that fall below the legal thresholds, particularly within the technology and healthcare industries. At the EU level, there are signs that merger control could be relaxed
in response to the USA’s “America First” policy. In reaction to these developments, foreign investment screening is expected to tighten, particularly for criti - cal sectors. Economic factors In 2025, France faces a challenging economic context, with GDP growth slowing to 0.7% (as at 15 September 2025). Political and fiscal uncertainties are weighing on business confidence. Corporate distress has also risen sharply: 10.5% of French companies are now classified as distressed and business failures have reached historic highs. This increase in distress vol - ume is also opening up new investment opportunities for investors seeking attractive assets at competitive values in the French market. France continues to face significant budgetary chal - lenges, with its public deficit now being the highest in the eurozone. The French government is under pres - sure to reduce spending while managing high debt levels. This task is further complicated by a divided Parliament, with political instability making it particu - larly challenging for President Emmanuel Macron’s administration to pass significant budgetary or fiscal reforms, especially given that France has already seen four different governments since the July 2024 snap elections. France is currently facing a difficult political context, making it challenging to implement structur - al reforms and likely impacting the French economic context and M&A market in 2025 and beyond. Despite these pressures, France remains an attrac - tive option in terms of investment. This is thanks to the country’s advanced economy, strong R&D, and resilience driven by domestic demand. Technological advancements The rise of digital transformation and AI has driven French M&A activity in the technology sector. Com - panies are increasingly looking to acquire technologi - cal capabilities in order to remain competitive and this move has influenced the French M&A market. This trend is significantly evidenced by the rise in AI companies’ valuation – notably, the French Mistral AI is now valued at EUR11.7 billion, following 2025 roundtables – and the creation of several AI-dedicated funds in 2025.
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