On Thursday, June 26, James Forrest and Ashley Smith sat down with Clint Bundy, Managing Director of the Bundy Group, a boutique advisory firm. Together, they explored the latest in M&A trends, and examined market dynamics, and best practices for navigating mergers and acquisitions in a variety of sectors. Watch the full recording here.

The following information provided is for general informational purposes only and is not intended to be legal advice. While we strive to ensure the accuracy and timeliness of the information, laws and regulations are subject to change. We recommend contacting your Michael Best attorney for advice specific to your situation.

Macro M&A Timeline

• 2021: A peak year for M&A deals. This was due to a number of factors. Few transactions took place in 2020 on account of the pandemic. There was also the threat of a tax rate increase in 2022. This made 2021 the sweet spot for a robust M&A market.
• 2022-2023: The market dropped down to more normalized levels, with a slight dip in M&A deal volume.
• 2024: Another rebound year with a resurgence in M&A transaction volume.
• 2025: A good start to the year, but several headwinds have appeared in Q2; tariffs, geopolitical tensions, threats of recession, etc. The increase in market uncertainty has impacted people’s desire and willingness to pursue M&A deals. Overall, the market is cautiously optimistic.

Current Active Industries in M&A Markets

• Business services
  • Companies are actively consolidating in the fire security and fire safety sectors.
• Tech-enabled services
  • There are a lot of M&A deals happening in the automation and industrial technology sectors.
• Healthcare
  • Behavioral health, dermatology, and aesthetics sectors are the most active right now.

When Deals Fall Apart

At a macro-level, around 50% of deals can “fall apart.” While this percentage may seem high, this includes “deals” where a group has indicated they are interested but then don’t end up following through. For deals that are under LOI, this percentage drops.

Some of the most common reasons a deal falls apart include:

• Material adverse change that was unpredictable
• Last-minute change of heart
• Uncertainty in the market
• A high number of decision makers
   

Considerations for a Successful Merger

As the Seller

• Assemble your team
  • Fractional CFO: Consider hiring a fractional CFO to help with financial questions and matters.
  • Legal Counsel: Align your plans with your legal counsel team to help run audits and ensure your business is prepared to sell.
  • Investment Banker: Consider hiring an investment banker to streamline getting your company to auction, they have a good grasp on the current M&A landscape for your industry.
  • Fractional COO: If operational improvements need to be made, you can bring on a fractional COO.
  • Leadership Team: Build out your bench of talent to ensure you have a solid team in place to support and advocate for the company vision and goals post-sale.
• Have a minimal number of decision-makers in the room.
  • If you have too many people in the room, it can complicate the deal.
• Be realistic about what your hopes are for yourself post-sale
  • Do you want to retire, do you want to maintain some level of involvement in the company, etc. Have a clear goal in mind.
• Be prepared for changes to be made to your company after the sale
  • Even if the changes are minor, there will almost always be things that end up looking a little different. This is due to different management styles, visions for the company, and strategies being employed by the new owner.

As the Buyer

• Consider the current M&A landscape for your industry
  • What do current deals look like?
  • What companies are available?
• Assemble your team:
  • Legal Counsel: A good legal team can help ensure the deal that is created is advantageous to both you and the seller. They can also help offer advice concerning what deals to pursue.
  • Investment Banker: While not mandatory, having an investment banker can help you in areas such as valuation, negotiation, deal structure, and market knowledge.
• Understand your goals for the deal
  • Are you looking to merge the new business into an existing one?
  • Are you looking to acquire a new business?
• Be thorough with your audit of the company
  • Understand what insurance policies are in place.
  • Make sure the cybersecurity of the company is sound.
  • Review all internal elements of the company to help you understand the company as a whole.
• With the sale, you often acquire key talent, systems, and culture. Consider how you can best merge your hopes and vision with the current vision and culture to ease the transition.

Future Considerations for M&A Deals

Employing the use of AI

AI software can consolidate vast amounts of publicly available information. This can help streamline things like competitive analysis, market research, and provide both parties with a better understanding of the M&A deal process. What AI cannot do is provide proprietary information. And with AI, there is always the risk of misinformation or hallucinated information.

Embracing the unknown

Many in the M&A space are cautiously optimistic about where the market is heading for the remainder of 2025. Despite headwinds like geopolitical tensions, tariffs, and interest rates, buyers and sellers are still actively engaged.

For more information, or to discuss a potential M&A deal, please contact a member of our team: Mergers and Acquisitions | M&A Process - Michael Best & Friedrich LLP