The confidence and enthusiasm that has propelled dealmaking to $3.5 trillion this year may be spreading from the boardrooms of corporate acquirers to private equity, said Goldman Sachs Group Inc.’s Matt McClure.
While strategic acquirers deploying capital to scale up their core businesses have largely drive the current M&A surge, buyout firms appear ready to join the rush, McClure, Goldman Sachs’ global co-head of investment banking, said in an interview on Bloomberg.
“We’re seeing signs of life but it’s gradual,” McClure said of private equity buyers. “With one and a half trillion dollars of capital to deploy, that’s going to be put to work at some point and obviously M&A is going to be a component of that.”
Only 680 of the 30,384 M&A and related deals globally this year — accounting for only $286 billion, or 8.2% of the total — were private equity buyouts, according to data compiled by Bloomberg.
The market for initial public offerings is “wide open” and, with blockbuster listings expected by a clutch of companies, is expected to remain healthy even if a few IPOs slip to 2027, McClure said. Even listings this year by companies without an AI component are up 30% year over year, he said.
One broader development affecting deals is that state regulators have been expanding their role in antitrust enforcement, McClure said. Such efforts are adding pressure on dealmakers to make sure they cover all potential state as well as federal regulatory issues in a transaction, he said.
One example of that trend is the lawsuit by 12 states that has complicated Paramount Skydance Corp.’s $110 billion acquisition of Warner Bros. Discovery Inc.
As always, headwinds may pick up, McClure said. That includes the possibility of continuing high interest rates and energy prices, and geopolitics is a “wild card,” he said.
“I would say whatever that headwind ultimately ends up being that potentially dampens the M&A market,” he said, “we’re probably not going to be able to predict it right now.”
Written by: Michael Hytha and Dani Burger @Bloomberg
The post “Private Equity Buyers Seen as Joining $3.5 Trillion M&A Surge” first appeared on Bloomberg