Bundy Group: 2025 in Focus

Looking Ahead to 2025:

As we move into the new year, the M&A landscape is ever evolving. Whether you're considering selling your business now or in the future, or contemplating a capital raise, understanding the current state of the market to best prepare your company for a liquidity event is critical. We've outlined key trends and insights that will help you navigate 2025 with confidence:

After a down 2022 and 2023, and a renewal in 2024, the M&A market is poised for further growth in 2025. Below are some additional thoughts from the Bundy Group team:

• Increased Activity: According to PitchBook, the 2024 North American M&A market deal value surpassed $2 trillion across 17,509 deals, marking a 16.4% YoY increase in value and a 9.8% jump in deal count. Drivers included a stable economy, easing regulations, lower cost of capital, and renewed confidence from financial sponsors to divest of their aging portfolio investments.  Industry experts anticipate that market momentum to continue in 2025.
• Buyers' Appetite: Corporate and financial sponsors continue to seek growth through acquisitions, especially as both entities sit on a tremendous war chest of balance sheet cash and uninvested capital. Both buyer types are eager for high quality industries and companies and apply technology or efficiency gains to drive competitive advantages.
• Fragmented Sectors: Industries such as physician practice management, life science services, automation solutions, technology services, and material handling solutions remain fragmented, offering ample room for consolidation, growth, and value creation.

While buyer interest is strong, the competitive sale process, led by an investment banker and experienced advisory team, is as critical as ever. There are some important steps to take as a part of this process:

• Pre-Sale Preparation: Preparation is key! Take the time to work with advisors to understand your business's strengths, challenges, and what can make it a more attractive acquisition target.
• Increased Scrutiny: Strategic buyers and financial sponsors are as diligent and thorough as ever, requiring businesses to demonstrate solid fundamentals and the ability to withstand potential market downturns.
• Leverage Competition: In recent Bundy Group engagements, the gap between the lowest and the highest offer price in Letters of Intent has been as wide as 100%+. This underscores the impact of a competitive sales process in driving higher valuations and better terms for sellers. Moreover, it highlights that the only way to determine a company’s true market value is through an investment banker-led process.

Several sectors are expected to see strong M&A activity in 2025. Specific areas to note include:

• Healthcare & Life Sciences:
  • Behavioral Health & ABA Therapy: A fragmented space with strong buyer demand, creating various consolidation opportunities.
  • Regenerative Health: The next evolution of the aesthetics and wellness sector – this subsegment is quickly generating significant interest from financial sponsors. 
• Tech-Enabled Services:
  • Automation & Controls: Prevalent demand for automation and system integration services that improve efficiency, especially in sectors like material handling, data centers, and water/wastewater management.
• Business Services:
  • Fire & Life Safety: Aging populations and expanding healthcare systems are driving demand for life safety and fire suppression services.
  • AI Infrastructure: As artificial intelligence adoption grows, so does the demand for power and service solutions to support these technologies, making infrastructure service and repair businesses highly attractive.

As 2025 unfolds, the M&A market shows great opportunity but requires careful navigation. Whether you're selling or acquiring, understanding key market dynamics, preparing your business, and leveraging competition will be essential tools for success.

If you have any questions or want to discuss how Bundy Group can assist in your M&A journey, please explore our website or contact our team directly for more information.

We’ll be attending several conferences this year and we'd love to meet with you! Be on the lookout for additional information on where we’ll be this year. If you're planning to attend, or if you’d prefer to speak to us virtually or by phone, you can contact one of our team members here, or email us at info@bundygroup.com.

Bundy Group Insights:

We're excited for Season 2 of Bundy Group Insights, a podcast that takes you behind the scenes of the latest developments in mergers & acquisitions, capital raises, economic, business, and industry-specific trends.

We recently recorded an episode where we reviewed 2024 and discussed trends for 2025.

Whether you’re a practice owner, investor, or industry enthusiast, this podcast is your ultimate guide to navigating the intricate world of mergers and acquisitions.

Follow along on the following channels to never miss an episode:

Apple podcast
Spotify
YouTube 

Thank you to our clients, networking partners, and industry relationships for the confidence you have placed in Bundy Group. We will keep you posted on our progress in 2025!

About Bundy Group

Established in 1989, Bundy Group is an industry-focused investment bank that specializes in representing business owners and management teams in business sales, acquisitions, and capital raises. The team of highly experienced investment bankers leverages extensive industry knowledge and skill to provide hands-on guidance to clients through every phase of the business transaction. Bundy Group has been a trusted partner in more than 250 closed deals over the past 36 years, providing high quality options, actionable insights, and delivery of optimal strategic fit at a premium value for our clients.   

Bundy Group Securities, LLC, is a registered broker-dealer and member of FINRA and SIPC. More information on the background of Bundy Group Securities, LLC is available at FINRA's  BrokerCheck.