Doing Deals In Times Of Turbulence

The global M&A market is picking up after a slow start to the year. For much of the first half, uncertainty over trade negotiations, regulatory changes and geopolitical tensions kept dealmakers on the sidelines. But in recent weeks, we’ve seen a clear boost in sentiment across regions and sectors. The signs are clear: stabilizing macroeconomic conditions, better clarity on key trade agreements and a growing acceptance that uncertainty will persist.

The critical question facing today’s leaders isn’t whether conditions will revert to normalcy, but rather if their organizations will be ready to seize the best opportunities before their competitors.

The Case for Acting Now

Despite headlines warning of ongoing uncertainty, hesitation could be costly. Corporate and private equity investors are currently sitting on record levels of capital—more than $12 trillion of “dry powder” globally. History shows that acquisitions made in downturns or slower markets generate five to six percentage points higher total shareholder return than those made in frothy conditions. Less competition for assets, more disciplined valuations and the ability to create private markets offer significant advantages to those who act decisively.

Readiness is the key to success. Companies that consistently outperform in M&A cultivate an “always-on” approach. They continuously review their portfolios, proactively engage with potential acquisition targets and routinely scenario-test their strategic assumptions. They understand their own strategic gaps, maintain detailed playbooks for both deal-making and integration and are prepared to act swiftly when the right opportunities arise.

The New Dynamics of M&A

Although traditional best practices remain crucial, technology is revolutionizing the M&A process. Artificial intelligence is accelerating early-stage deal-making activities, from market landscaping to target identification. BCG has created AI agents that can map adjacencies, surface high-potential targets and assess fit in minutes—work that previously took weeks. These tools won’t replace the judgment and creativity of experienced deal teams, but they do allow those teams to spend more time on high-value activities: probing assumptions, pressure-testing scenarios and refining integration plans.

Additionally, the increased rigor of regulatory scrutiny requires dealmakers to integrate compliance considerations early in deal strategy and to maintain vigilant oversight through every phase of integration.

Opportunities in Today’s Environment

Executives should focus attention on several strategic opportunities shaped by the current climate:

“Jump the Tariff” Strategies: Companies can mitigate cross-border trade costs by investing directly in local production or acquiring assets in key markets.

In-Country and Regional Consolidation: In industries such as packaged foods and semiconductors, local market dynamics offer attractive consolidation opportunities that insulate businesses from broader global trade disruptions.

Joint Ventures and Alliances: Increasingly prominent in sectors like automotive, partnerships allow companies to share the substantial investments and risks involved—notably within emerging technologies like electric vehicles.

Supply Chain Resilience Moves: Acquiring capabilities or critical assets that enhance supply chain security and shorten lead times is particularly advantageous given recent disruptions and ongoing uncertainties.

Four Actions Leaders Can Take Now

Leaders looking to capitalize on today’s M&A environment can focus on four strategic priorities:

1. Review and optimize your portfolio: Identify businesses where your company is the best owner, both for consolidation plays and growth moves into higher-margin adjacencies. Be equally disciplined about divesting non-core assets.

2. Build robust M&A capabilities: Ensure internal teams possess the necessary skills, playbooks and external support to act as efficiently and confidently as serial acquirers, from due diligence to capturing full value post-acquisition.

3. Ensure financial readiness: Structure your organization’s balance sheet for agility, enabling rapid deployment of capital when opportunities arise.

4. Align leadership and the board: Maintain a shared understanding of the strategic role of M&A, enabling swift decision-making with governance already in place.

Emerging Even Stronger

For CEOs and CFOs, the path forward is not about weathering the storm—it’s about navigating through it to reach a stronger position on the other side. Deals done today, with the right strategy and execution, can turn turbulence into transformational opportunities.