M&A dealmakers in the US are optimistic that Donald Trump’s election win in November will boost deal activity next year, according to a new report from A&O Shearman.

Dealmakers are anticipating a ‘Trump Bump’ as the incoming president promises to lower taxes, reduce regulatory red tape and cut the size of the government, potentially boosting the US economy, the biannual M&A report says – the first under the combined A&O Shearman brand. 

The incoming administration is also expected to create a merger review landscape that is more favourable for waving deals through, though US antitrust agencies may still be wary about Big Tech-related deals. Healthcare and pharmaceutical deals may also continue to attract regulatory scrutiny even if the broader merger review backdrop is less onerous, the report argues.

The report also underscores a resurgence in M&A activity involving US acquirers targeting UK-listed businesses. Such deals clocked in at $15.2bn by mid-October, up from $7.7bn in the whole of 2023. All of that has come despite UK takeover rules making it harder for bidders to execute deals, with the number of approaches far exceeding the volume of announced and completed deals.

In Europe, former European Central Bank head Mario Draghi has been calling for an overhaul to competition enforcement in the EU to boost the region’s economy and make its companies more competitive globally. Draghi is proposing that competition enforcement is more forward-looking rather than prudential, which could pave the way for larger deals in sectors that are seen as strategic.

Meantime, the prospects for the private equity exit market are also brighter next year, A&O Shearman says. In the US, falling interest rates have meant the lower cost of capital is “helping buyers bridge the valuation gap with stubborn sellers”. Trump is also expected to cut corporate tax to free up capital for businesses and make it easier for them to pursue deals to drive growth.

Private equity exit values rose 90% quarter-on-quarter in the second quarter of this year in Europe, lifted by 23 mega-exits that were responsible for more than half of the total; 10 of those were IPOs, suggesting the congested listing pipeline is starting to ease, the report states. This year is also on course to be the best year for private equity-backed IPOs globally since 2021.

David Broadley, global co-head of M&A at A&O Shearman, said: “Our latest report comes at the end of a busy year of elections around the world, which combined with various geopolitical uncertainties have impacted M&A markets… The M&A landscape in 2025 will remain highly competitive and our global network of experts involved in M&A will continue to deliver valuable insights and opinions on what is shaping dealmaking.”