Donald Trump, has emerged as a polarizing figure to deal professionals. Intralinks recently surveyed M&A professionals around the world to gauge their sentiment about the election’s potential impact on M&A.
One of the key findings was that 52 percent of the 1,700 respondents said a Donald Trump presidency would be negative for the M&A market. Trump’s unpredictable style and fiery rhetoric have some investors worried that as president he could trigger trade wars and create financial market volatility. Traditionally, Republicans are perceived as more business-friendly, but Trump is viewed as anything but a traditional candidate.
M&A professionals in the United States were less concerned about his impact on business than their peers elsewhere. According to the survey, 44 percent of NA dealmakers said they believed Trump would have a negative impact on M&A activity, compared with 68 percent of dealmakers in Latin America (LATAM). Trump has sparked controversy with his views on immigration and border control. Some 62 percent of dealmakers based in Europe, Middle East and Africa (EMEA) and 66 percent in Asia Pacific (APAC) also thought Trump would be bad for deal making.
Now on the other side of the political fence, globally, only 22 percent of respondents thought Hillary Clinton would have a negative impact on M&A. Only 30 percent of deal professionals in NA think that a Clinton Administration will have a negative impact on M&A, which is a bit lower than Trump. In LATAM, EMEA and APAC, 3, 12 and 9 percent of respondents believe Clinton would have a negative impact on deal making, respectively. M&A has grown significantly over the past two terms, both held by a Democrat, so the thinking goes that if another Democrat steps into the White House, M&A activity should continue to remain stable at the very least.
However, a Trump presidency might be more conducive to a favorable regulatory and antitrust climate, which could mean more deals. As far as individual sectors go, deals in coal, natural gas and oil would benefit from a Trump presidency, given the fact that he's in favor of traditional energy sources, for now.
A Clinton victory may put more pressure on big pharma M&A. Clinton is on record as saying that she’ll crack down on “outrageous price gouging” by drug makers. A Clinton White House would also be a positive for the alternative-energy sector, as she’s been a vocal supporter of solar, wind power, geothermal and hydropower energy sources.
It will certainly be an interesting next few months to see how M&A is affected.
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