From short-term recovery to long-term restructuring
Analyzing the drivers behind the M&A rebound in 2025, experts at Bain & Company identify two defining trends that are shaping the next cycle. These are not temporary fluctuations, but signals of a fundamental shift in the structure and role of M&A.
First, 2025 has been a year of “big bets.” A number of mega-deals have been initiated by companies that are not frequent acquirers. Lacking an established M&A learning curve, these transformational transactions raise a critical question: will they generate sustainable value, or merely reflect opportunistic decisions driven by strategic pressure and fear of being left behind?
Second, despite the overall vibrancy of the M&A landscape, acquisitions no longer occupy a central position in corporate capital deployment. Cash flows are increasingly directed toward long-term investments aimed at strengthening internal capabilities – ranging from factories, industrial parks, data centers, machinery and production lines, to technology infrastructure such as IT systems, servers and private cloud platforms. These investments create long-lived assets and underscore a shift toward growth built on durable foundations rather than expansion through deal-making.
At the same time, R&D spending continues to rise sharply, becoming a key lever for companies to develop new products, technologies and business models, particularly in areas related to artificial intelligence (AI), automation and digital infrastructure. As expectations for capital efficiency become more stringent, M&A must now compete directly with internal investment. Each deal is compelled to answer a fundamental question: does it deliver value that clearly exceeds the “build-it-yourself” alternative?
Unlike previous, more localized recovery cycles, the M&A wave of 2025 has shown broad-based momentum across both sectors and geographies, with all major regions posting double-digit growth in deal value.
A standout feature has been the strong resurgence of global technology M&A, with total deal value rising more than 75% year-on-year. This wave has been led by AI-centric transactions, including Alphabet’s USD 32 billion acquisition of Wiz and Palo Alto Networks’ USD 25 billion takeover of CyberArk. Large minority investments have also played a prominent role, such as SoftBank’s USD 40 billion investment in OpenAI and Meta’s USD 14.3 billion stake in Scale AI. Nearly half of the value of strategic technology deals exceeding USD 500 million during the year came from “pure-play” AI companies or transactions centered on AI-driven competitive advantages.
Beyond technology, advanced manufacturing and services have also emerged as key drivers. The USD 88 billion merger between Union Pacific and Norfolk Southern, along with the tripartite partnership between Airbus, Leonardo and Thales to create a large-scale player in the space sector, highlights the growing ambition for industry-wide restructuring.
Geographically, the United States has retained its central role, accounting for nearly half of global strategic M&A value. China has led in deal volume, supported by a dynamic domestic market. Japan has emerged as a bright spot, with M&A value doubling and the country rising to become the world’s third-largest market. Meanwhile, the Europe-Middle East-Africa region recorded a sharp increase in deal value driven by mega-deals, even as transaction volumes edged down.
Vietnam’s distinct market dynamics
Within this global backdrop, Vietnam’s M&A market in 2025 has displayed its own distinctive character, more cautious and selective, yet still rich in opportunity.
According to KPMG Vietnam, investment capital is flowing back toward core value, focusing on sectors with stable cash flows and clearly defined long-term demand. From now through 2026, investor attention is expected to concentrate on healthcare, education and training, B2B services, and essential sectors such as logistics, waste management, energy and consumer finance.
A growing preference for safety and cash-generating assets is becoming increasingly evident. Medium- to large-sized enterprises with transparent governance and proven financial track records continue to attract intense investor competition. By contrast, weaker assets face prolonged negotiations or are required to undergo restructuring before they can return to the negotiating table.
With global interest rates remaining elevated, Vietnam’s market continues to favor buyers. Valuations have become more conservative, accompanied by a rise in risk-sharing mechanisms. Where expectation gaps between buyers and sellers persist, structures such as earn-outs-under which part of the deal value is paid only if post-merger performance targets are met-or seller financing are increasingly used to bridge differences. However, these arrangements also demand stronger post-merger governance and financial discipline to prevent risks from being deferred into the integration phase.
At the same time, many deal processes that stalled between 2022 and 2025 are gradually being reactivated, supported by more realistic pricing and clearer strategic rationales, ranging from generational transitions and refinancing to business carve-outs.
High-stakes bets and latent risks
Looking ahead to 2026, many experts believe the world is entering a powerful, multi-year M&A cycle, with numerous USD 50 – 100 billion transactions already in the pipeline, particularly in the technology sector.
If 2021 was defined by cheap capital and exuberance, the cycle that began in 2025 is being shaped by capital discipline, strategic clarity and execution capability. Many post-pandemic constraints have eased: regulatory environments have become more accommodating, capital costs have moderated, and expectation gaps between buyers and sellers have narrowed significantly. While valuations are edging higher, sellers are no longer anchored to the peaks of 2021. More importantly, a growing number of corporate leaders recognize that waiting itself can constitute a strategic risk.
The deeper driver of this new cycle is AI. The disruptive force of AI is compelling companies to make a clear choice: reinvent themselves or be overtaken by change. In this context, M&A has become a tool to accelerate transformation. A Bain & Company survey of more than 300 M&A leaders shows that AI adoption in M&A has doubled to 45%, spanning deal sourcing, screening, planning and post-merger integration. Notably, one in five strategic investors has walked away from a transaction due to concerns about AI’s potential impact on the target company’s business model.
The paradox of 2025 is that while M&A activity rebounded strongly, its share of total global corporate cash spending fell to around 7% – the lowest level in more than a decade. Most of the increase in deal value came from mega-deals exceeding USD 5 billion, which accounted for over 75% of total growth. Around 60% of these transactions were driven by infrequent acquirers, with many “bet-the-company” deals valued at 50% or more of the buyer’s market capitalization.
History shows that high-stakes bets can redefine companies, but they can just as easily destroy value if not anchored in a sound strategic foundation. The challenge extends beyond financial due diligence to fundamental questions: post-merger vision, operating models, decision-making mechanisms, organizational culture and the ability to integrate technology effectively.
While M&A experience can mitigate execution risk, no learning curve can shield a company from failure if the underlying strategic choice is flawed. In large-scale transactions, failure rarely stems from technical shortcomings; more often, it originates from strategic decisions that were insufficiently examined from the outset.
