Constellation Research CEO R. Ray Wang and Heritage Foundation Public Finance Economist EJ Antony join Mornings with Marining to discuss their vision for 2025.
President-elect Donald Trump A return to the White House after President Biden's administration successfully challenged several high-profile mergers over the past four years could bring changes to the mergers and acquisitions market.
The Biden administration's Federal Trade Commission (FTC) and the Department of Justice's Antitrust Division have intervened in several proposals. Mergers and acquisitions They undermine competition and harm potential consumers by challenging transactions.
Deals that were ultimately blocked by federal courts or abandoned by the parties to the deal included Kroger's $25 billion acquisition of Albertsons, while mergers between airlines JetBlue and Spirit, as well as luxury fashion companies Capri and Tapestry, were also blocked. By court order.
With FTC Chair Lina Khan leaving the agency later this month and leadership of the DOJ's antitrust division also set to change with the new administration, market participants expect the second Trump administration to take a lighter approach to contracts over the next four. year
Mergers and Acquisitions Blocked or Challenged by Biden Admin in 2024
President-elect Donald Trump's administration is seen as likely to take a more favorable approach to mergers and acquisitions. (SAUL LOEB/AFP via Getty Images/Getty Images)
KPMG conducted an annual survey of corporate and private equity dealmakers that found 76% of respondents said the election results would increase US M&A activity, while 80% said it increased their own appetite for deals. possible Tax policy The changes were seen as encouraging M&A activity by 811% of dealmakers, while 79% said the election would lead to an easier regulatory or antitrust environment for deals.
A recent survey conducted by Tenio found a similar sentiment that found 83% of CEOs and 87% of investors expect the mergers and acquisitions market to experience a major return in 2025, up from 68% last year. The share of respondents who expect “significantly more” M&A activity increased from 17% to 37% among CEOs and from 26% to 34% for investors.
NISSAN, HONDA announce plans to consider merger
Kroger and Albertsons abandoned their merger after it was blocked by a federal court. (Kroger: Getty Images via Charles Bertram/Lexington Herald-Leader/Tribune News Service
The survey also found that 86% of both CEOs and investors Assume that there will be an accelerated pace of M&A activity under the Trump administration, while 80% of CEOs and 74% of investors predict that the administration will have a positive impact on deal completion.
Ted Jenkin, president of Exit Stage Left Advisors, told Fox Business that Trump's selection of Andrew Ferguson to serve as FTC chair, the $35 billion “Consolidation Monday” in early December and potential tax changes in 2025 mean “the writing is on the wall. That the coming The next four years should be very strong for merger and acquisition activity.”
Raj Sharma, director of strategic business development and M&A at Etochu, said that inflation is coming down and Low interest rates The Trump administration is likely to create deals with a new approach to scrutinizing such transactions.
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“President Trump has generally been quite permissive of M&A in the financial services, energy and industrial sectors,” Sharma added. “It is expected that he will allow it again in his second term, although he has criticized the influence of big technology and will not be as supportive of M&A in that space.”