The recovery of the M&A market since the early days of the pandemic has been impressive. Even allowing for varying treatment of Covid-19 winners and losers, deal processes for resilient assets (and even for less obviously attractive assets) are often extremely competitive, and valuation multiples have continued to rise. Such high deal values and volumes have been accompanied by heightened regulatory interest in deal making, and challenges for deal planning and execution.

The extent to which the war in Ukraine, the imposition of sanctions and export controls on Russia, and related geopolitical, financial and commodity volatility will impact the global M&A outlook is hard to predict – some geographies, sectors and businesses have experienced immediate effects, while for others implications will become clear in time. However, it seems certain that as regulators and governments push to introduce or enhance a wide range of rules impacting investments in multiple sectors, dealmakers should expect that the hand of government will be felt in M&A deals, even for businesses not traditionally viewed as ‘regulated’. In our view, such enhanced regulatory focus is here to stay and dealmakers must now address how best to tackle the implications and minimise the impact of regulatory interventions in deals.

Originally published by International Financial Law Review - March 2022.