M&A trends for 2025: A year of strategic revival and transformation

Craig Hamm • January 29, 2025

Services: Quality of Earnings, M&A Tax Services, Due Diligence


After a period of market uncertainty and regulatory headwinds, 2025 is shaping up to be a year of renewed momentum in mergers and acquisitions (M&A) activity. The convergence of several favorable factors—including stabilizing interest rates and clarity in the regulatory environment following the U.S. election —is creating optimal conditions for dealmaking.  

Companies that have been cautiously observing from the sidelines are now positioning themselves to pursue strategic opportunities, while private equity firms are preparing to deploy their substantial accumulated capital.  

Success in this evolving environment will demand more than just favorable market conditions—it will require careful preparation, clear strategic vision, and a particular focus on people and culture integration risks as workforce considerations become increasingly central to deal success. 

M&A markets: Emerging from the slowdown 

The M&A resurgence comes at a critical time. The past few years have seen dramatic shifts in the landscape, from the record-breaking deal volumes of 2021 to the subsequent pullback in 2022 and 2023. Now, with improved market visibility and more predictable financing conditions, organizations across sectors are revisiting their growth strategies and considering how strategic acquisitions can help them adapt to an increasingly competitive business environment. 

The stage appears set for a notable uptick in deal activity, though the nature of transactions is likely to differ from previous cycles. Let’s examine how this recovery is taking shape and what it means for deal volumes across different market segments. 

Deal momentum: 2025 volume projections 

Industry experts project a robust increase in deal activity for 2025, with estimates suggesting a 10 percent rise in overall M&A volume following a 13 percent advance in 2024. Private equity is expected to lead this growth with a projected 16 percent increase, while corporate M&A is anticipated to grow by 8 percent. 

“From where we sit, the market is showing clear signs of a dramatic shift. The surge in sell-side preparation work we’re seeing suggests buyers should brace themselves – there’s going to be a flood of quality assets coming to market in 2025.”

Craig Hamm, BPM Partner and Transaction Advisory Group Leader

The mid-market segment is emerging as a particular bright spot, driven by companies seeking strategic consolidation and competitive advantages. With corporations sitting on substantial cash reserves following a shortage of high-quality targets in 2024, there is mounting pressure to put this capital to work through strategic acquisitions. 

Key drivers of M&A activity

Several fundamental factors are converging to create favorable conditions for dealmaking in 2025: 

Economic stabilization 

The anticipated continuation of interest rate cuts and moderating inflation is providing dealmakers with the predictability needed for transaction planning.  

Private equity deployment 

With an estimated $2 trillion in dry powder, private equity firms face mounting pressure from limited partners to deploy capital and generate returns. This pressure, combined with more favorable financing conditions, is expected to catalyze significant PE activity in 2025. 

Sector-specific opportunities 

Certain sectors are positioned to see particularly active M&A markets in 2025: 

Life Sciences and Healthcare: Continuing innovation and the need for scale are driving consolidation in these sectors, with regulatory oversight potentially becoming more accommodating.  

Technology and Software: The ongoing tech modernization and AI integration needs are spurring deals across all industries, with technology capabilities being a key consideration in virtually every transaction. 

Consumer Products and Online Retail: Market consolidation and shifting consumer behaviors are driving strategic acquisitions in this space, with companies focused on expanding market share and strengthening distribution capabilities 

Challenges and considerations 

Despite the optimistic outlook, dealmakers face several important considerations: 

  • Transaction readiness: Companies need robust pre-deal preparation, including clear strategic rationale, financial readiness, and operational scalability assessments. Those without adequate preparation risk deal failure or suboptimal outcomes. 
  • Regulatory environment: While there’s hope for a more accommodating regulatory climate, careful navigation of antitrust and foreign investment reviews remains crucial, particularly for larger transactions. 
  • Valuation expectations: With strong equity markets, sellers’ valuation expectations remain high. Buyers need to demonstrate clear value creation strategies to justify premium valuations. 
  • Integration planning: Post-merger integration planning is becoming increasingly critical, particularly regarding technology systems and workforce integration. Companies that prepare thoroughly for these challenges are better positioned for successful transactions. 

Looking ahead to M&A in 2025 

The M&A landscape in 2025 appears set for a period of strategic rather than purely opportunistic dealmaking. Companies are focusing on core revenue-generating functions while divesting non-core assets. The emphasis is on quality over quantity, with careful consideration of strategic fit and value creation potential. 

The path to successful transactions in this environment will require organizations to move beyond traditional financial and operational considerations. Those who excel will be the ones who can effectively navigate complex stakeholder dynamics while maintaining unwavering focus on their strategic objectives. With improved economic conditions, abundant capital and transformative technologies at play, 2025 could mark the beginning of a new chapter in M&A activity. 

Profile picture of Craig Hamm

Craig Hamm

Partner, Advisory
BPM Board of Directors

Craig leads BPM’s Transaction Advisory Group with a focus in financial due diligence and quality of earnings services. Craig directs …

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