Corporate appetite for acquisition deals is increasing. From shifting global dynamics to the rise of AI, it's a unique environment for deal-making.
J. Neely, Accenture's Global Transaction Advisory Practice Lead and Senior Managing Director, shares his thoughts on what's driving recent M&A activity and how executives can prepare. “This space is changing rapidly, and AI has the potential to have a significant impact on shaping and driving transactional value,” Neely said. “Now, agent AI is tipping the curve again by redefining how deals are executed and expanding what can be achieved with post-trade value creation.” Here's what finance leaders need to know.
What factors are most influencing M&A activity?
Dealmaker activity is on the rise and macroeconomic and regulatory conditions are improving. The reason behind this is the role of technology and how advanced AI is changing the core of trading.
On the economic front, there are signs of improvement in financing conditions due to lower interest rates and an expanding bond market, including growth in private credit, creating favorable conditions for dealmakers. At the same time, the regulatory landscape is evolving in both the United States and Europe, and there is renewed interest in large-scale transactions, although some cross-border transactions remain difficult due to multilateral relationships and the increasing complexity of global supply chains.
No discussion would be complete without mentioning AI. CFOs and other executives need to act decisively and with precision to ensure that deals create value using AI to drive growth, efficiency, or both.
How are changes in global power relations affecting trade and market competitiveness?
There has been an increase in activity stemming from cautious optimism among dealmakers. Leaders have a better understanding of the current economic and regulatory landscape, and this understanding helps them pursue large-scale deals that generate economic and consumer benefits.
On a global scale, there is value in companies that can adapt and diversify their access to growing markets, thereby building resilience amid geopolitical challenges and trade policy.
Why are companies increasingly choosing to break up large companies, and what should CFOs and executives consider to properly manage these transactions?
Perhaps now more than ever, portfolio strategy is a key element. Large companies are putting a magnifying glass on their portfolios and assessing what really fits from a business and customer value perspective.
As CFOs and other executives prepare to manage these transactions, they must ensure that they are simplified and aligned with the organization's strategic identity. This trend contrasts with past waves of defensive or crisis-driven stock sales. By divesting non-core businesses, companies can reinvest in growth and strengthen the businesses that will ultimately determine their future.
Additionally, the rise in the number of activist investors (four out of 10 S&P 500 companies have been targeted by an activist at least once in the past 15 years, according to Accenture research) has increased the pressure on companies to deliver on their value claims. Dividing a large, diverse business into more closely aligned business units is one way to reduce complexity and streamline goals. Businesses work best when a clear vision shapes strategy, so executives need to ensure they can achieve their objectives and chart a path to growth.
AI is already having a huge impact on M&A, but we are just getting started as agent AI becomes mainstream. How do you expect AI to continue to shape the sector, and how can CFOs and other senior leaders best prepare themselves and their employees for what's ahead?
Conversations with dealmakers have gone from speculating about how AI will change dealmaking to exchanging information about use cases. The field is changing rapidly, and AI has the potential to have a significant impact on shaping and driving transaction value. Now, agent AI is tipping the curve again by redefining how deals are completed and expanding what is achievable with post-trade value creation. To continue to drive transformation, CFOs and other senior executives must:
- Upskill your workforce in AI and incorporate its use into core activities such as screening and diligence. Involving people in the process ensures more effective implementation. Trading teams need hands-on training with agent AI tools, and centralized, differentiated data can help derive insights.
- Use AI to identify and pursue opportunities for quick and early wins. AI is used during the close review and planning process. AI is already having an impact and will eventually extend across the entire transaction lifecycle. In post-trade value creation:
- Focus on selective value zones: Start with high returns and low risks.
- Build a unified data fabric: Seamless interoperability is the key to agent AI success.
- Reframing risk as innovation capital: Moving governance from prevention to acceleration.
- Scale reinvention across your portfolio: Each trade should make the next one smarter.
- Treat AI as a key force that drives deal-making and revenue growth. Use this as an opportunity to innovate and redesign your team's core workflows and operations using AI agents and tools. Companies with AI-driven intelligent operations achieve 2.5x higher revenue growth and 2.4x higher productivity than their peers.
