Big Deals, Small Volumes: What M&A Tells Us About 2025

Introduction: The M&A landscape in 2025 feels like a poker table in a windstorm. Chips are still in play, but only the bold—or the exceptionally strategic—are making big bets. Global deal volumes are down 9% YoY, yet deal values are up 15%. Translation? Fewer deals, but bigger plays. As we enter the second half of the year, the market whispers two words: cautious optimism...

Where the Money's Going: It’s no longer about how many deals you close—it’s about what those deals mean. The tech sector is still red-hot, driven by AI acquisitions and digital overhauls. Banking and power/utilities are also drawing boardroom attention. Meanwhile, private equity firms, sitting on piles of dry powder, are reshuffling their portfolios with a vengeance. Carve-outs, spin-offs, and mid-market rollups are all in play. Expect more of the same through Q4.

The Wild Cards: Tariffs, geopolitical tension, and market volatility continue to test conviction. Two-thirds of executives admit these risks are chilling their appetite for M&A. But here's the twist—interest rates are stabilizing, which is reigniting the leveraged buyout engine. Financing is loosening just enough to bridge the gap between buyer boldness and seller expectations.

Private Equity's Quiet Dominance: Private equity isn’t just participating—they're dictating the rules of engagement. Activity is already up 16% YoY and still climbing. PE firms are acting as both hunters and hunted, looking to cash out mature holdings while snatching up undervalued targets. Their influence is reshaping mid-market dynamics, especially in tech and industrial niches.

Regional Behavior: If you're looking for cross-border fireworks, temper your expectations. The Americas—particularly the US—are playing it close to the chest. Over 90% of deal capital is staying domestic. Meanwhile, EMEA and Asia-Pac players are increasingly eyeing U.S. targets, hinting at confidence in American economic fundamentals.

What This Means for the Lower Middle Market: While large firms chase billion-dollar blockbusters, smart buyers are moving down-market in search of agile, niche operators. That’s opening the door for lower middle market businesses—especially those with strong cash flow, proprietary tech, or regional dominance. With PE firms pursuing buy-and-build strategies, smaller companies are increasingly attractive as bolt-ons or new platforms. But scrutiny is high. Clean financials, scalable operations, and tech readiness are no longer optional—they’re expected. Valuation discipline is real, yet high multiples are still on the table for resilient, future-ready companies.

What This Means for You: Mid-market businesses should take note: this isn’t a volume game anymore—it’s a value war. Strategic fit, digital capability, and regional agility are the new golden metrics. If you're buying, be laser-focused. If you're selling, know your worth and prep accordingly. Either way, flexibility isn’t optional—it’s your edge.

Conclusion: H2 2025 won’t be easy—but it could be lucrative. The M&A market is rewarding those who think long, act smart, and adapt fast. It’s less about riding momentum and more about creating it. Big deals are back—but only for those who understand where value truly lives. Want to be one of them? Start building your strategy—before someone else buys your future.