Trump Expected to Usher in New M&A Era with Second Term
Deal News | Nov 08, 2024 | EIN
Following President-elect Donald Trump's victory, Wall Street is buoyant as expectations rise for a significant increase in mergers and acquisitions (M&A) during his second term. Trump's campaign promises to lessen regulatory constraints and streamline government interference have sent the Dow Jones Industrial Average soaring to record highs, with banking, energy, and cryptocurrency stocks leading the ascent. Industry analysts, including Goldman Sachs, have predicted a 20% increase in M&A activities, buoyed by anticipated relaxation in antitrust measures under Trump’s administration. The Federal Trade Commission and the Department of Justice Antitrust Division are likely to adopt a more lenient stance under new leadership, potentially facilitating previously hindered mergers. Markets are already responding, with shares in companies like Tapestry, Capri, and the airline sector seeing significant gains. Additionally, speculation surrounds changes within the Securities and Exchange Commission (SEC) with current chair Gary Gensler, known for his stringent stance against cryptocurrency, expected to step down. Wall Street looks towards potentially new leadership at the SEC that could further favor deregulation, such as potential successors Dan Gallagher of Robinhood or Paul Atkins of Patomak Global Partners.
Sectors
- Financial Services
- Regulatory and Compliance
- Technology
- Retail
- Airlines
Geography
- United States – The article centers around the expectations and implications of U.S. regulatory changes and M&A activities following the election of President Trump.
Industry
- Financial Services – The article discusses anticipated M&A activity driven by financial institutions like Goldman Sachs in response to political changes.
- Regulatory and Compliance – The anticipated deregulatory environment under the Trump administration will affect various sectors through regulatory and compliance relaxations.
- Technology – Tech companies, such as Apple, Google, and Amazon, are mentioned in the context of antitrust action and possible regulatory changes.
- Retail – Retail companies like Tapestry and Capri are cited as potential beneficiaries of the expected increase in M&A activity.
- Airlines – Airline stocks, such as Frontier and Spirit, are referenced regarding blocked mergers that could be revisited under a new administration.
Financials
- 20% – Predicted increase in M&A activity by Goldman Sachs in 2024.
- 15% – Decrease in M&A activity compared to 2023 as reported by Goldman Sachs.
- 5.5% – Increase in Tapestry's stock price following Trump's election win.
- 10% – Increase in Capri's stock price following Trump's election win.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Donald Trump | President-elect | People | Expected to influence U.S. regulatory policy affecting M&A. |
| Goldman Sachs | Financial Analyst | Companies | Provided an analysis predicting a 20% increase in M&A activity. |
| Warner Bros. Discovery | Company | Companies | CEO expressed optimism about potential business consolidation under the Trump administration. |
| Federal Trade Commission (FTC) | Regulatory Body | Government | Expected to relax antitrust enforcements, facilitating M&A activities. |
| Department of Justice Antitrust Division | Regulatory Body | Government | Expected to adopt a more relaxed approach towards antitrust regulations. |
| Gary Gensler | SEC Chair | People | Known for a stringent regulatory stance, particularly against cryptocurrencies; speculated to be replaced. |
| Dan Gallagher | Potential SEC Chair | People | Chief legal officer at Robinhood, considered a candidate for SEC Chair. |
| Paul Atkins | Potential SEC Chair | People | Former Republican SEC commissioner and CEO of consultancy Patomak Global Partners. |