Wall Street is excited as President-elect Donald Trump is expected to usher in a new era of increased dealmaking during his second term — including a The pace of mergers and acquisitions increased,
This is Trump’s second victory in the White House, who had campaigned on the promise of Loosen the reins of the regulatory statedriven by banking, energy and cryptocurrency stocks, has sent the Dow Jones Industrial Average to record highs this week.
But easing antitrust enforcement could boost shares of US companies across the board in the meantime. In a note to clients Wednesday, Goldman Sachs predicted a 20% increase in M&A activity next year. The investment banking giant said M&A activity is down 15% this year compared to 2023.
“The Regulatory position of the Federal Trade Commission and the Department of Justice Antitrust Division David Kostin, chief U.S. equity strategist at Goldman Sachs, wrote that many of the proposed business combinations that have been challenged over the past four years are likely to receive greater relaxations under the incoming administration.
David Zaslav, CEO of Warner Bros. Discovery, whose cable news network CNN has long had an adversarial relationship with Trump, expressed optimism that his incoming administration would be a “real positive” for business consolidation.
“We have an incoming new administration,” Zaslav told analysts on an earnings call Thursday.
“It is too early to tell, but this could provide an opportunity for a pace of change and consolidation that could be quite different, which would provide a real positive and accelerated impact on this industry that is needed.”
In July, Zaslav expressed hope that the next administration would allow more mergers.
“We just need an opportunity for deregulation, so companies can consolidate and do what we need, even better,” Zaslav said at the time.
The Biden administration has frustrated business leaders with its aggressive antitrust stance, led by Federal Trade Commission Chairwoman Lina Khan, Securities and Exchange Commission boss Gary Gensler and Jonathan Cantor, the head of the Justice Department’s antitrust division.
The FTC, under Khan, has filed a lawsuit to block the merger of supermarket giants Kroger and Albertsons. The agency has also taken action against Amazon for alleged antitrust violations related to its Prime subscription service.
Tech companies like Apple, Meta and Google have also been subject to antitrust action by the Biden administration.
Several tech CEOs were there, including Apple boss Tim Cook, Google chief executive Sundar Pichai and Amazon founder Jeff Bezos. One of the first people to congratulate Trump on his election victory.
Analysts predicted this week that the Trump administration would greenlight the Kroger-Albertson merger as well as other currently stalled deals, including the proposed Tapestry-Capri deal.
Tapestry, the luxury retailer that owns Coach and Kate Spade, saw its stock price rise more than 5.5%, while Capri stock was up 10% from Tuesday.
Shares of Frontier and Spirit — two airlines that were blocked from merging by a federal judge — also rose earlier this week in the wake of Trump’s victory.
Gensler, a former Goldman Sachs banker, has become a thorn in the side of the crypto industry due to the dozens of cases he has brought against digital currency firms and traders.
Trump has promised to fire Gensler, who is expected to step down shortly after the administration takes office in late January.
The transition team advising Trump is reportedly considering Dan Gallagher, currently the chief legal and compliance officer of retail trading platform Robinhood, as a potential successor to Gensler.
Gallagher, a popular choice among cryptocurrency executives who donated millions of dollars to Trump’s campaign, is the frontrunner at this point, though discussions are fluid, two of the people said.
Also running for SEC chairman is Paul Atkins, another Republican former SEC commissioner and CEO of consultancy Patomac Global Partners.
Atkins served on Trump’s transition team in 2016, when he was also a contender for the role of SEC chair, Reuters reported at the time.
