As we head into summer 2025, mergers and acquisitions (M&A) stands at a crossroads. Geopolitical tensions, economic headwinds, and rapid advances in technology are forcing dealmakers to rethink how they source, structure, and close transactions. Trade policy is emerging as a major variable. Unpredictable tariffs, shifting alliances, and growing regulatory scrutiny have pushed global deal activity into more cautious territory. Yet amid the uncertainty, artificial intelligence is coming into focus.
AI is no longer a futuristic add-on. It’s becoming central to the way companies approach M&A. In a climate where speed, precision, and risk management matter more than ever, AI is giving dealmakers a critical edge. It helps surface opportunities faster, pressure-test assumptions, and spot risks early, before they derail a transaction. AI isn’t just making M&A faster. It’s making it smarter.
Trade Uncertainty Is Reshaping M&A Strategy
Changing US trade policies are stalling cross-border deals and making future revenue streams harder to predict. As a result, dealmakers face a two-sided challenge: how to keep deal momentum alive while insulating portfolios from geopolitical shocks.
Some of the effects are already evident on Datasite, which handles over 19,000 new deals a year. New deal kickoffs, especially asset sales and mergers, are up 4% globally in the first four months of this year compared to the same time a year ago. Since these are deals at inception before they are announced, it can provide a good sense of what’s to come and some of the momentum that has already occurred.
Yet there’s caution, too. Deal completion rates on Datasite sank to 44% after the first major US tariff announcement on April 2, down from 49% year-over-year (YoY). This means buyers are slowing down. They want more time to evaluate risks. They’re asking more questions. They’re probing the fine print, and if necessary, they are walking away.
A key reason is tariffs. When tariffs are imposed on imported goods or raw materials, they can directly impact the cost structures and profit margins of target companies, especially those with global supply chains. This creates volatility in financial projections, which complicates valuation models and discourages dealmaking. Buyers face added risk as they try to assess whether a target’s current revenue performance can be sustained under changing trade conditions. In many cases, tariffs prompt companies to reconsider expansion into or acquisition within certain countries, shifting M&A activity toward regions with more stable trade relationships.
Additionally, ongoing trade tensions, such as those between the US and China, have led to increased regulatory scrutiny, which further delays or derails deals. These combined factors force dealmakers to spend more time conducting due diligence, modeling various tariff scenarios, and adding protective clauses to deal structures. This then makes the M&A process more complex and costly.
Tariffs are not just increasing operational expenses, they are also reshaping strategic planning by making it more difficult to forecast long-term growth, return on investment, and integration outcomes in cross-border transactions.
Risk models now routinely factor in tariff exposure. Buyers are looking not just at what a target company earns today, but how future trade policy could affect that cash flow. Some deals, particularly cross-border ones, are being paused or restructured entirely as the investment math shifts.
To stay competitive, dealmakers must adapt. That means embracing better tools, faster workflows, and more rigorous diligence. It also means building flexibility into the deal process to account for economic swings.
AI Streamlines Diligence and Strengthens Risk Controls
This is where AI is stepping in. It’s helping deal teams process more information in less time and with greater accuracy. Due diligence is a critical but resource-intensive process that traditionally involves manually reviewing large volumes of documents and information. This approach can be time-consuming and laborious, often placing significant strain on professionals, especially when working under tight deadlines. As a result, the quality and thoroughness of the review may be compromised. AI offers a solution to this challenge by enabling faster and more efficient analysis. AI tools can quickly sort, summarize, and highlight key clauses and relevant obligations within documents, allowing dealmakers to focus on the most important information. This not only improves accuracy but also significantly reduces the time required to complete the due diligence process. For example, AI can organize, categorize and flag key data and risks across thousands of documents in a virtual data room in real time, helping to reduce human error and ensuring compliance with regulatory requirements.
It’s no surprise that one in five dealmakers now use generative AI in the M&A process, while many more say AI adoption is their top operational priority this year. Why? Because the M&A playbook is changing. Reviews are more intense. Regulators ask more questions. Investors demand deeper insight. AI helps answer the call.
Virtual data rooms are also evolving. It’s now common for deal teams to use AI-powered Q&A tools to interrogate information before making a move. In fact, the use of Q&A tools on Datasite has climbed since the start of the year, reflecting an increased need for sellers to be ready to respond quickly and thoroughly to buyers who want to see clean, complete data.
Additionally, AI is increasingly playing a valuable role in identifying potential acquisition targets. By analyzing various market signals, such as company descriptions, geographic compatibility, and size-related criteria, AI can help buyers pinpoint suitable candidates more efficiently. These insights are often derived from a combination of public, private, and proprietary data sources. As a result, some AI-powered platforms are already enabling dealmakers to discover potential targets more quickly and accurately. This proactive approach can improve strategic alignment, making it easier for companies to integrate new capabilities post-acquisition and achieve the growth objectives intended by the deal.
AI can also contribute to the valuation process by offering data-driven analyses based on historical trends and current market conditions. It can also automate routine and labor-intensive tasks, such as redacting sensitive information in documents. By streamlining these operational steps, AI allows professionals to focus more on high-level strategy and innovative thinking, ultimately improving the quality and effectiveness of decision-making throughout the M&A lifecycle.
Dealmakers Must Shift from Reactive to Proactive
In today’s environment, waiting for the perfect moment to launch a deal isn’t a strategy, it’s a liability. Timing matters, but preparation matters more. Those who succeed in this market will be the ones who invest early in deal readiness. That can include cleaning up financials, mapping supply chain dependencies, reviewing IP portfolios, and aligning management on deal terms.
Of course, AI alone isn’t the answer. The best strategies combine human insight with machine intelligence. Use AI to surface options. Use your team to make the calls. Technology should guide the process, not replace judgment.
The Future of M&A Is Here
M&A will always carry risk. But how to manage that risk is changing. AI is raising the bar. It’s giving dealmakers the tools to work faster, smarter, and with more foresight.
In a world where tariffs will likely continue to evolve, and regulators can shift course mid-review, speed and insight matter. The future belongs to dealmakers that are data-driven, tech-forward, and strategically agile.
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