Carole Raddato / Wikimedia Commons / CC BY-SA 2.0
Wall Street advisers see growing pressure on companies to bring forward major merger plans as executives weigh the prospect of closer congressional scrutiny. The concern is about the time needed to negotiate and review large transactions, even while the Trump administration’s merger enforcers remain in place.
Companies face a choice about whether to accelerate strategic deals after Democrats won control of Congress in the midterm elections. For corporate boards, the calculation is whether a transaction that takes months to prepare could face a more difficult public and political reception by the time it reaches regulators.
Kevin Foley, co-head of investment banking at JPMorgan Chase, said companies should prepare to operate through continued uncertainty rather than wait for familiar conditions to return.
“The biggest risk may be assuming that, sooner or later, things go back to normal,” Foley said. “Standing still is always an option, but when industries are changing this fast, it’s the wrong one.”
Fernando Rivas, a senior Wells Fargo banker, said at an industry conference in Boston on Thursday that a “now or never” mentality would return to drive merger activity in the near term.
The timing matters most for complex combinations that require lengthy negotiations and regulatory reviews across several countries. Paul Nary, an assistant professor of management at the University of Pennsylvania’s Wharton School, said that companies contemplating such transactions should begin work now and probably announce them by mid-2027. That is his assessment of the dealmaking window, rather than a regulatory deadline.
A change in congressional control does not give lawmakers control of the Justice Department or the Federal Trade Commission, the agencies responsible for federal merger enforcement. Hearings, investigations and subpoenas are ways Congress could put large transactions and corporate executives under greater scrutiny.
Paul Humphreys, global co-head of industrials at Freshfields, said Congress would likely be selective because of limits on its time and resources. He expected attention to focus on themes such as affordability and accountability, with executives potentially facing questions even after a transaction has received clearance.
For dealmakers, the planning calculation is tighter: preparing a merger early may give companies more time to work through reviews, but it does not remove the risk of scrutiny after a deal is approved.
JBizNews Desk | New York
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