MARKET SEGMENTS
MARKET SEGMENT
Which segment of the market do you expect to experience the greatest increase in deal activity?
Small-market deals edge out the middle market, with only 10% expecting large deals to lead
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
DEAL INVOLVEMENT
Do you expect your organization (or portfolio companies) to participate in any of the following during the next 12 months?
Acquisitions lead, but 44% of respondents expect none of these transactions
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
Respondents could select all that apply.
BUYER INFLUENCE
Which buyer group will have the greatest influence on deal valuations over the next 12 months?
Nearly half of respondents point to private equity buyers
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
ACTIVITY DRIVERS
What will be the top drivers of M&A activity over the next 12 months?
Availability of capital is the most cited driver, named by 48% of respondents
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
Respondents could select up to three answers.
OBSTACLES
What will be the biggest obstacles to M&A activity over the next 12 months?
Economic uncertainty, valuation gaps, and financing costs are each cited by more than 45% of respondents
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
Respondents could select up to three answers.
STRATEGIC PRIORITIES
What is your organization’s highest strategic priority for value creation over the next 12 months?
Revenue growth is the top priority, cited by 37% of respondents
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
EXPECTATIONS
How strongly do you agree with these statements about the next 12 months?
About two in three expect due diligence requirements to rise and tariffs to disrupt cross-border deals
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
Due diligence requirements will increase
Agree: 66%Tariff and trade policy uncertainty will delay or restructure cross-border deals
Agree: 64%Sell-side preparation quality will be a key determinant of deal success
Agree: 62%Private equity activity will increase
Agree: 62%Valuation expectations will become more aligned
Agree: 41%Regulatory scrutiny will increase
Agree: 40%Percentages are rounded and may not add to 100.
PRIVATE EQUITY
What impact will longer private equity holding periods have on M&A activity over the next 12 months?
Opinion is split: 40% expect a positive impact and 38% a negative one
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
AI AND INSURANCE
How do you expect emerging technologies, including AI, to influence the Representation & Warranties Insurance market over the next 12 months?
Four in ten expect policies to expand to address AI-related risks
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
AI IMPACT
What impact will AI have on M&A activity over the next 12 months?
One in three expects AI to speed up diligence and the deal process, while 9% expect a negative impact
Share of responses by theme, with examples in respondents’ words.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
“AI will improve the speed and quality of diligence, particularly around financial analysis, contracts, supply chains and customer data.”
“Transaction timelines will be shortened; costs will be expected to be decreased; and risk will be allocated.”
“It will increase complexity of IP and privacy risks, deepening due diligence requirements.”
“Defined use policy and implementation will become a required element.”
“AI is likely to accelerate the deal process and M&A activity overall.”
“AI will have a moderately positive impact on activity.”
“Easier target identification.”
“Quicken target identification and related research.”
“Companies that use it to their advantage will be sought after.”
“All sellers or IPO candidates must have AI-related capabilities, no matter the industry.”
“Negative due to not performing as anticipated.”
“Mostly negative in constricting operations.”
“I do not anticipate that AI will have a meaningful impact on M&A activity over the next 12 months because many companies have not yet fully adopted/integrated AI into their day-to-day business.”
Percentages are based on responses that contained an answer. Open-ended responses grouped by theme; some responses fit more than one, so percentages do not add to 100.
AI IN THE DEAL PROCESS
Where will AI create the greatest value in the M&A process?
Due diligence is where respondents see AI creating the most value, at 63%
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
Respondents could select up to three answers.
AI RISKS
What is the biggest risk associated with AI in dealmaking?
Accuracy and reliability top the list at 38%, ahead of over-reliance by dealmakers (28%) and data privacy (23%)
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
INDUSTRY OUTLOOK
Which industries will experience the most M&A activity over the next 12 months?
Data centers and digital infrastructure lead at 38%, ahead of technology (32%) and healthcare (30%)
Share of respondents.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
Respondents could select up to three answers.
CHALLENGES
What is the biggest challenge facing M&A activity in the industries you selected above?
Regulation and politics leads at 19% of responses, ahead of valuation gaps and the cost of capital (17% each)
Share of responses by theme, with examples in respondents’ words.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
“Government regulation and oversight.”
“Public sentiment turning against PE.”
“Reconciling seller valuation expectations with buyer return requirements in an elevated and volatile cost of capital environment.”
“Valuation gaps between buyers and sellers.”
“Higher cost of capital based on increasing interest rates.”
“Scale and availability of capital.”
“Current geopolitical and economic uncertainty can create hesitation around capital deployment and stall transactions.”
“Lack of quality targets will reduce the level of activity.”
“Finding targets that are both strategically compelling and capable of meeting the return expectations required of a public company.”
“Due diligence to closing timelines.”
“Realizing synergies.”
Percentages are based on responses that contained an answer. Open-ended responses grouped by theme; some responses fit more than one, so percentages do not add to 100.
OPPORTUNITIES
What is the single biggest opportunity for dealmakers over the next 12 months?
AI and technology adoption is the most common theme, mentioned in about one in four responses
Share of responses by theme, with examples in respondents’ words.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
“Effective AI integration into M&A processes.”
“Unlocking value in founder-owned, mid-market legacy businesses by applying modern digital infrastructure, programmatic workflows, and operational efficiency tools that prior generations left unoptimized.”
“Acquiring strong brands and businesses that have loyal customers and attractive products but lack the scale, distribution capabilities or capital needed to reach their full growth potential.”
“Finding quality targets at reasonable valuations.”
“Private companies with aging ownership will spur more M&A.”
“Businesses that need an exit, either because of long hold periods or no internal successor for closely held companies.”
“Consolidate weak players and remove debt with restructure.”
“Purchasing companies in out of favor industries at depressed valuations.”
“PE firms having a lot of dry powder for deals.”
“Good valuation multiples, with no presidential election for two years to disrupt them.”
Percentages are based on responses that contained an answer. Open-ended responses grouped by theme; some responses fit more than one, so percentages do not add to 100.
RISKS
What is the single biggest risk to M&A activity over the next 12 months?
Economic uncertainty, the cost of capital, and geopolitical upheaval each account for more than one in five responses
Share of responses by theme, with examples in respondents’ words.
Hover over a bar or use Tab to focus it for its value. Values are rounded percentages supplied for this chart.
“Macroeconomic shocks interacting with stubborn valuation expectations, creating prolonged deal paralysis where quality assets command unrealistic premiums while distressed assets face severe financing constraints.”
“Economic uncertainty and market volatility.”
“Persistent increase in cost of capital, will restrict financing, reduce transaction returns and keep buyer underwriting requirements materially below seller valuation expectations.”
“Collapse of private credit market.”
“Geopolitical and economic uncertainty, particularly around consumer spending and the fiscal outlook.”
“Political upheaval in DC.”
“The political backlash against AI and AI data center development and the regulation of AI.”
“AI bubble breaking.”
“Economic and trade-policy uncertainty that makes buyers more cautious and widens the valuation gap between buyers and sellers.”
“Valuing the businesses correctly for the best sell price.”
“International antitrust regulators.”
“Regulatory scrutiny.”
Percentages are based on responses that contained an answer. Open-ended responses grouped by theme; some responses fit more than one, so percentages do not add to 100.
