U.S. M&A rises sharply as big-ticket transactions return amid favorable policy developments

North American M&A activity mirrored the prevailing global trend in 2025, with an uptick in deal value in the second half of the year to USD1.1 trillion despite M&A volumes falling. 

In the U.S., the surge in H2 was dramatic: aggregate transaction value was 24% up on H1 following a wave of megadeals, the most headline-grabbing of which involved rival bids from Netflix and Paramount to acquire one of the biggest names in filmmaking. If the deal is approved, it would be among the largest transactions in history.

The average transaction size between October and December 1 (USD400.1 million) was more than three times higher than in Q1 (USD121m). Q3 alone saw USD578 billion in deal value, the highest quarterly total since 2021. The rise was fueled in part by a series of rate cutes from the Fed.

Private equity investors played an important role as they shifted their focus to mid-market deals while retaining appetite for large transactions. Meanwhile corporates actively rebalanced their portfolios through divestitures and carve-outs to fund strategic acquisitions.

Midterms not expected to impact regulatory enforcement

Looking ahead, the U.S. midterm elections are not expected to have a major impact on deal activity, even if the Democrats win control of one or both houses of Congress. Enforcement by important agencies such as the Department of Justice (DOJ), Federal Trade Commission (FTC), and Committee on Foreign Investment in the United States (CFIUS) has not been a major focus under the current administration, and we expect that to continue whatever the outcome in November. Indeed the U.S. antitrust agencies have sought to litigate just a handful of transactions since President Trump entered office in January.

Focus on artificial intelligence

Artificial intelligence was one of the overriding M&A drivers of 2025, with deals in every sector targeting AI systems, the data required to develop and fine-tune models, and people with AI expertise.

Perhaps the highest-profile transaction of the year came in September with the announcement of a strategic partnership between Nvidia and OpenAI. The letter of intent set out Nvidia’s plan to invest USD100 billion in the creator of ChatGPT, while 10 gigawatts of Nvidia systems would be deployed to support OpenAI’s next generation infrastructure. (At the time of writing, the deal was yet to be finalized.)

The partnership was one of a string of similar investments involving the world’s biggest tech companies. In the same month as the OpenAI deal, Nvidia unveiled a USD5bn agreement with Intel to co-build data centers and chips.

In November it pledged to invest up to USD10bn in Anthropic, which secured a further USD5bn from Microsoft. OpenAI has itself committed to spending USD1.4tn on AI infrastructure as it bids to create artificial general intelligence, which includes a strategic partnership with AMD to deploy 6 gigawatts of AMD graphics processing units (GPUs).

But AI investments are not just multibillion-dollar tie-ups between chipmakers and the developers of foundational models and agentic technologies.

Corporates and financial sponsors are also pursuing acquisitions of proprietary data on which to develop specialized AI systems. Meanwhile, companies in data-rich sectors such as healthcare and financial services are looking to buy AI capabilities that can improve their decision quality and accelerate the timeline for developing new drugs.

From a process perspective, AI acquisitions raise a range of unique legal, regulatory, and commercial risks that relate to everything from IP infringement and ownership to data privacy and cybersecurity. Addressing these risks in an M&A context requires a strategic, forward-looking approach to diligence.

The nature and scope of AI-related risks depend on a variety of factors, including the type of AI technology being acquired, how it has been trained, and the intended future use cases.

Even where AI is not the primary value driver for a deal, AI-related issues need to be considered on every M&A transaction given that almost any target will be deploying and/or building AI systems in some form.

All this must take place in a rapidly evolving and increasingly fragmented regulatory landscape, as countries across the world legislate to meet their objectives.

At the same time, the risks relating to practices such as data scraping, model training and retrieval augmented generation (RAG) are being reshaped by data authorities, policymakers and the courts on an almost daily basis.

Policy landscape points to increased oil and gas M&A

We anticipate an increase in M&A in the North American oil and gas sector throughout 2026 and beyond following favorable policy developments in both the U.S. and Canada.

The U.S. government’s Unleashing American Energy executive order and One Big Beautiful Bill Act roll back a host of federal sustainability and decarbonization policies and introduce new tax incentives for oil and gas producers.

North of the border, Canadian Prime Minister Mark Carney has recently signed a memorandum of understanding with Alberta’s premier to facilitate construction of a 1,100km pipeline connecting the province’s oil sands to Canada’s Pacific coast. The proposed pipeline, which will be privately constructed and financed, is one of a series of infrastructure projects backed by the Canadian federal government under its 2025 Budget, which aims to reduce Canada’s economic reliance on the U.S. as tensions between the two countries run hot. 

The deal exempts the proposed pipeline, which is expected to have a capacity of one million barrels of oil a day, from certain federal environmental regulations as well as the existing ban on oil tankers off the coast of British Columbia. To offset the rise in emissions, Alberta has agreed to build a USD11.7bn carbon capture and storage facility. 

The project will boost exports to Asia and marks a significant shift in policy direction for the Canadian government. The previous federal government had for over a decade resisted calls from Alberta for new infrastructure to support the energy industry. 

The announcement is expected to generate interest in Canada’s oil and gas sector from foreign investors; Canada has the world's fourth largest proven oil reserves after Saudi Arabia, Venezuela, and Iran, but its lack of infrastructure to transport crude oil has limited its ability to exploit its natural resources.

Transaction timelines extended in response to HSR reforms

As far as deal practice is concerned, we are seeing transaction timelines extended following reforms to the Hart-Scott-Rodino (HSR) pre-merger reporting regime.

The changes increase the information burden imposed on merging parties by requiring additional transaction-related (f/k/a/ 4(c)/4(d)) and ordinary course documents; narrative descriptions of competitive overlaps, supply relationships, transaction rationale, and prior transactions; and information on buy-side structures, minority shareholders, officers and directors, foreign subsidies, and defense and intelligence contracts.

Following the reforms, transaction agreements have been updated to account for the increased time needed to prepare HSR filings​. Traditionally, purchase agreements have stipulated that the HSR filing would be submitted within five to ten business days of the deal being signed; 20 business days is now the norm, with longer timeframes (up to 30 business days) if the transaction involves competitive overlaps. 

Filers are increasingly adopting document protocols early, beginning document collection and information-gathering processes in advance of signing or filing under non-definitive agreements to reduce time between signing and closing.

The legal and other costs that parties incur making HSR filings have increased significantly in line with the enhanced information requirements.

However, the possibility for parties to seek and obtain early termination of the waiting period under the HSR Act for transactions that do not post competition issues has returned after having been suspended since February 2021. Both the U.S. Federal Trade Commission (FTC) and the Department of Justice (DOJ) can now grant requests for early termination of the HSR waiting period in cases that do not raise substantive antitrust concerns, allowing deals that do not require other regulatory approvals to close earlier than upon expiry of the statutory 30-day waiting period.

The agencies have also generally been willing to accept minor corrections, where submitted filings do not conform to a requirement, without delaying the start of the waiting period or “bouncing” filers for deficient filings

Federal government brings notable changes to CFIUS process

The Committee on Foreign Investment in the United States (CFIUS) national security screening process has undergone some notable changes under the current U.S. administration whose policy program pursues multiple, often competing, goals in relation to foreign investment.

The Trump administration’s America First Investment Policy—introduced via executive order in February—reframes U.S. investment policy by inviting inbound investment from the United States’ traditional allies while seeking to disadvantage China, particularly in relation to technologies such as artificial intelligence and semiconductors, through heightened scrutiny of China-related transactions.

Under previous administrations, CFIUS sometimes required parties to enter into national security agreements or provide letters of assurance to mitigate long-term national security risks presented by proposed transactions. However, the current administration has stated that it intends for CFIUS to pull back from this practice, and instead simply approve or reject transactions. We are still seeing these agreements being negotiated, so it remains to be seen how aggressively this policy will be implemented in the coming year(s).

The Department of Defense (DOD, renamed by President Trump as the Department of War) is also playing an increasingly important role in the review of transactions by CFIUS. DOD views the economic sphere as a key part of its remit and is more closely involved in deal reviews than in the past.

Under the current administration, CFIUS has shown its desire to scrutinize any connection a foreign acquiror might have with China, as well inbound investors’ capacity to thwart cyber attacks and prevent U.S. tech from being accessed by threat actors (especially China). Meanwhile, it is also focused on assessing potential acquirors’ long-term strategy for growth in the U.S.; any dealings with sanctioned parties (including by or through affiliates or joint ventures); and is conducting thorough reviews of purchasers’ ownership structures, all the way up to ultimate beneficial owners.

Buyers advised to review other deals that could delay M&A transactions

As far as deal practice is concerned, in an environment where transactions are facing enhanced regulatory scrutiny in the U.S. and elsewhere, when negotiating a purchase or merger agreement for a particular acquisition, it is critical for buyers to carefully review other pending or potential transactions under consideration that could potentially impede or delay the timely receipt of the required approvals.

Regulatory efforts covenants in purchase and merger agreements will typically restrict purchasers from taking actions that may impede or delay the receipt of required regulatory approvals, and as a result buyers should look to build sufficient flexibility into any such covenants so as not to curtail their ability to pursue other M&A opportunities while the transaction at hand is pending.

Filing parties, especially private equity and investment funds, must also consider how responses provided in one regulatory filing could affect future filings made to the same regulator.