M&A After The Vote

Writing this post on November 5th, one is bound to be thinking about the outlook for M&A under a new Democratic government.

The people I do business with are looking at two major unknowns: tax and regulation. Both are cause for concern as the political map gets redrawn, and both may have a depressing effect on mergers and acquisitions.

At the same time, we should also ask ourselves who might do well under a new regime. Which industries are positioned to take advantage of the change in political climate? For companies considering business acquisitions, it’s a question worth pondering because your acquisition strategy should always be focused where market demand is strong.

Here are a few sectors to watch. Healthcare is almost certainly going to experience quite a shakeup, with significant growth in some areas. Green energy could be in for a substantial infusion of government funds.  If there’s increased investment in infrastructure such as rail and road, opportunities may grow for capital equipment. Generally, companies that directly serve government could do well such as those that supply large IT systems.

These answers are all speculation of course. My point is, the question itself is worth asking — especially as you think about your own acquisition plans.