Featured Professionals: John Arendale, Ty Denoncourt, Jenson Dunn, John Lautemann, Tim Webb

In a world being transformed by AI, a wide range of industrials sectors continue to provide investors with durable opportunities to deploy capital and achieve reliable returns.

In particular, HALO businesses—defined by heavy assets and low obsolescence—operate at the physical foundation of the economy, producing materials, components, and systems that are required regardless of software advancement or digital substitution.

“As AI reshapes so many areas, HALO platforms remain anchored in real-world execution: fabrication, assembly, testing, and delivery under exacting standards,” says Tim Webb, a managing director. “This combination of physical necessity, capital intensity, and manufacturing know‑how gives these businesses relevance across cycles. Many also benefit from embedded long-term tailwinds.”

Here, we explore these attributes and share several recent Harris Williams transactions exemplifying this enduring opportunity.

Industrial Strength

Several attributes shared by many industrials businesses contribute to their strong appeal to today’s investors.

AI Lift and Insulation

Industrial businesses are unique in that they enjoy a double benefit from the AI investment boom. First, they can serve as the “picks and shovels” for the massive AI capex cycle, providing the specialized infrastructure—from power distribution and cable management to advanced cooling systems—required to build data centers.

Second, many industrial businesses are leveraging AI to expand margins on physical products that cannot be disintermediated. AI enhances forecasting, scheduling, and process control, but it does not eliminate the need for heavy assets or validated processes. The result is a combination of productivity gains and insulation from rapid digital replacement.

Defensibility via Engineering Know-How

Another valuable attribute of industrial manufacturing is the engineering know-how embedded in physical processes. Many manufacturers enjoy moats supported by decades of proprietary manufacturing expertise, material science, and rigorous validation required to meet exacting performance standards. This deep institutional knowledge creates significant barriers to entry and reinforces the long-term value of the enterprise.

Compelling Structural Tailwinds

The investment case is further strengthened by sustained public and private investment in infrastructure, utilities, and data center facilities. Simultaneously, the aggressive trend toward reshoring and nearshoring is driving a generational reinvestment in U.S. production capacity. Manufacturers with established facilities, tooling, and execution capabilities are uniquely positioned to benefit from these shifts, making them some of the most compelling opportunities in the current M&A environment.

Conclusion

In an era defined by AI disruption, HALO businesses—those built on heavy assets and low obsolescence—offer M&A investors a rare combination of resilience and growth. These platforms benefit from both the AI capex cycle as essential “picks and shovels” suppliers and from AI-driven productivity gains, while remaining insulated from digital substitution. Reinforced by engineering know-how, reshoring momentum, and sustained infrastructure investment, they deliver durable returns across cycles.

As the clients above demonstrate, the opportunity is both broad and enduring. “The companies that physically build and sustain the real economy are positioned to compound value through the AI era,” says Webb. “For investors, that durability is a unique opportunity.”

To learn more, please contact us.