Featured Professional: Ryan Budlong

The M&A environment is accelerating, continually adapting to shifting interest rates, geopolitical uncertainties, and evolving economic forecasts. Both private equity and strategic buyers are actively recalibrating their strategies to capitalize on today’s opportunities.

Ryan Budlong, a managing director in our Consumer Group, recently discussed these trends during a webinar hosted by S&P Global entitled “M&A in Focus: The State of the Middle Market.” The webinar brought together industry experts to explore the current dealmaking climate, revealing a market characterized by optimism for the year ahead, a focus on quality, and creative deal structuring. Here, Budlong shares the key takeaways from this event.

Optimism and an Imperative

Budlong says his fellow webinar panelists shared an optimistic outlook for continued acceleration in the M&A market, largely driven by the imperative for investors to deploy capital and generate returns. Indeed, a central topic of the webinar was the immense amount of undeployed private equity capital that must be put to work and the aging portfolio companies that will need to be sold.

“Sponsors are facing a complex set of pressures,” says Budlong. “They have over a trillion dollars in dry powder to invest, yet the supply of new platform acquisitions has been somewhat limited. During the webinar we discussed how in recent months this has increased the focus on bolt-on acquisitions for existing platforms, which are typically perceived as lower risk.”

Panelists also discussed extended holding periods for portfolio companies, with some approaching six or seven years, driving limited partners to increasingly clamor for distributions. Budlong notes that this has helped spur the rise of alternative liquidity solutions like continuation funds: “The secondary market continues to serve as a primary engine for LP liquidity, with 2025 on pace to be another banner year in terms of volume. CVs have solidified their role as a mainstream, strategic alternative to a traditional M&A sale.”

While sponsors are balancing their need to deploy capital and generate returns with the still-limited supply of large, top-quality platform opportunities, strategic buyers have become increasingly active. “Strategic buyers have been very much present in a wide range of Harris Williams transactions this year,” says Budlong. “They can leverage deep sector knowledge, operational know-how, and synergy potential to be very competitive. Their ability to leverage scale can allow them to justify premium valuations for the sake of expanding market share or capabilities.”

Budlong also pointed to the improving interest rate environment as a welcome catalyst for M&A market acceleration. “Additional anticipated rate cuts from the Federal Reserve will further support dealmaking activity,” says Budlong. “Lenders are already being aggressive for top-quality deals, but there’s always room for improvement in the terms available to borrowers.”

Quality and Creativity 

Panelists agreed that while buyers are eagerly seeking opportunities to deploy capital, they remain focused on asset quality. In general, participants stated that buyers are willing to pay a premium for exceptional assets that demonstrate strong fundamentals, defensible market positions, and transparent financials. As one panelist noted, “great assets get great prices in any market,” and in challenging times, these high-quality businesses stand out even more.  

“Service-based businesses or companies with high levels of recurring revenue are commanding very healthy valuations,” says Budlong. He adds that buyers are particularly focused on businesses that are “boring but beautiful,” for example, those tied to essential services like aging infrastructure or residential services. For such assets, diligence timelines are shortening, and the market is becoming highly competitive. 

While the M&A market acceleration is underway, webinar participants discussed the increasing prevalence of creative deal structures to bridge any remaining valuation gaps and manage lingering uncertainty. In particular, earnouts, warrants, and significant minority or partnership deals were noted as becoming more common. “These structures allow sellers to get paid for future performance while mitigating risk for buyers, which is particularly useful for businesses with great upside potential but a degree of sector or business model complexity to manage,” says Budlong.

An Up Market

The M&A market is gathering speed, fueled by the imperative to deploy capital and generate DPI and the increasing adoption of creative structures. With interest rate headwinds fading and an already-supportive lending market set to improve, the environment is primed for continued acceleration in the coming year.

Please contact us to discuss these dynamics in more detail.

View the webinar replay.