As the new year dawns, the City’s corporate lawyers are already bracing for a relentless surge of mergers and acquisitions that promises to consume their waking hours. After an exhausting yet exhilarating 2024, top dealmakers foresee an even more frenetic pace in 2025 as a confluence of factors – from tax code changes to activist investor agitation to the return of risk appetite under a second Trump administration – set the stage for a blockbuster year in M&A.
A New Era of Dealmaking Dawns
The cheap debt that fueled a decade-long deals boom may be a distant memory, but a new M&A paradigm is taking shape as companies reposition for a high-rate, high-risk, high-reward business landscape. With the London Stock Exchange under pressure, British firms have become prime targets for both foreign acquirers and domestic consolidators looking to unlock value through bold corporate maneuvering.
Carving Up Corporate Empires
Activist investors, emboldened by recent wins, are expected to play an even more prominent role in 2025, pushing boards to shed non-core assets and streamline operations to boost shareholder returns. Household names like Unilever and Smith & Nephew are already facing calls to break up, setting the stage for a wave of divestitures and spin-offs as the conglomerate model falls out of favor.
We’re seeing bidders coming together to look at companies and take one piece while somebody takes the rest. There’s definitely a buildup of that.
– Sonica Tolani, White & Case
Tax Changes Spur Business Sales
The scrapping of inheritance tax relief for family enterprises in the UK budget is expected to prompt a wave of business sales and public listings as owners look to cash out before the new rules take effect. This one-time catalyst, combined with higher profit forecasts for banks in a rising rate environment, should provide ample dry powder for acquisitions both big and small.
The Trump Effect on Risk Appetite
Donald Trump’s return to the White House is already boosting animal spirits in the business world, with expectations of lower taxes and lighter regulations reviving risk appetite among executives and investors alike. The prospect of new tariffs is also expected to drive “friend-shoring” deals as companies reorganize supply chains around geopolitical alliances. Modest investments to secure critical suppliers could pay off handsomely in the new age of economic nationalism.
The Role of Technology in M&A
As the deal flow accelerates, banks and law firms are racing to harness artificial intelligence and machine learning to streamline the laborious process of due diligence and contract review. While the efficiency gains are tantalizing, many junior lawyers worry that “grunt work” automation could put their jobs at risk. The most forward-thinking firms are already exploring how to redeploy human capital towards high-value strategic advisory.
Bracing for an M&A Marathon
With all signs pointing to a sustained deals boom, City lawyers are resigned to another year of around-the-clock work, punctuated by hastily scheduled video calls from far-flung holiday destinations. While the long hours can strain personal relationships, the adrenaline rush of closing big transactions – and the outsize bonuses that follow – remain powerful draws for the most driven dealmakers.
This is a really sustained M&A period, if you’re looking through a few cycles. This is like the 00s, when I was a middle-level associate going from deal to deal to deal to deal. We’re hiring at all levels: senior, middle, bottom. Everybody’s busy.
– Patrick Sarch, White & Case
As the M&A market kicks into high gear, battle-tested City lawyers are limbering up for another marathon year of dealmaking. While the pace may be punishing, the opportunity to reshape corporate Britain – and reap the rewards of this once-in-a-generation boom – will keep them coming back for more. In the realm of high-stakes M&A, no amount of lost sleep can dull the thrill of victory.
Carving Up Corporate Empires
Activist investors, emboldened by recent wins, are expected to play an even more prominent role in 2025, pushing boards to shed non-core assets and streamline operations to boost shareholder returns. Household names like Unilever and Smith & Nephew are already facing calls to break up, setting the stage for a wave of divestitures and spin-offs as the conglomerate model falls out of favor.
We’re seeing bidders coming together to look at companies and take one piece while somebody takes the rest. There’s definitely a buildup of that.
– Sonica Tolani, White & Case
Tax Changes Spur Business Sales
The scrapping of inheritance tax relief for family enterprises in the UK budget is expected to prompt a wave of business sales and public listings as owners look to cash out before the new rules take effect. This one-time catalyst, combined with higher profit forecasts for banks in a rising rate environment, should provide ample dry powder for acquisitions both big and small.
The Trump Effect on Risk Appetite
Donald Trump’s return to the White House is already boosting animal spirits in the business world, with expectations of lower taxes and lighter regulations reviving risk appetite among executives and investors alike. The prospect of new tariffs is also expected to drive “friend-shoring” deals as companies reorganize supply chains around geopolitical alliances. Modest investments to secure critical suppliers could pay off handsomely in the new age of economic nationalism.
The Role of Technology in M&A
As the deal flow accelerates, banks and law firms are racing to harness artificial intelligence and machine learning to streamline the laborious process of due diligence and contract review. While the efficiency gains are tantalizing, many junior lawyers worry that “grunt work” automation could put their jobs at risk. The most forward-thinking firms are already exploring how to redeploy human capital towards high-value strategic advisory.
Bracing for an M&A Marathon
With all signs pointing to a sustained deals boom, City lawyers are resigned to another year of around-the-clock work, punctuated by hastily scheduled video calls from far-flung holiday destinations. While the long hours can strain personal relationships, the adrenaline rush of closing big transactions – and the outsize bonuses that follow – remain powerful draws for the most driven dealmakers.
This is a really sustained M&A period, if you’re looking through a few cycles. This is like the 00s, when I was a middle-level associate going from deal to deal to deal to deal. We’re hiring at all levels: senior, middle, bottom. Everybody’s busy.
– Patrick Sarch, White & Case
As the M&A market kicks into high gear, battle-tested City lawyers are limbering up for another marathon year of dealmaking. While the pace may be punishing, the opportunity to reshape corporate Britain – and reap the rewards of this once-in-a-generation boom – will keep them coming back for more. In the realm of high-stakes M&A, no amount of lost sleep can dull the thrill of victory.
