EY Says Big Deals Driving Record M&A Growth In U.S.

Deal momentum is accelerating into the final quarter of the year. With mega deals climbing and private equity reclaiming its dominance, 2025 is shaping up as one of the most active years for M&A since before the pandemic. Leo Cummings, an associate at Hunt Scanlon Ventures, explores EY’s latest Merger Monthly report and what it signals about leadership, technology, and the next phase of U.S. dealmaking.

The latest EY Merger Monthly report shows that the total value of large transactions rose 25 percent in Q3, propelling year-to-date U.S. deal value to $1.78 trillion – up 36 percent from the same period in 2024. September alone delivered 151 large deals totaling $257.6 billion in value.

Technology, oil and gas, and life sciences led the surge, signaling a renewed appetite for transformation after months of market caution.

EY points to a combination of macroeconomic and structural tailwinds driving the activity – including expectations of interest rate cuts in Q4 and growing C-suite confidence. The firm’s analysts describe a “race to transform,” as companies move from defensive restructuring to strategic offense through acquisitions and partnerships.

U.S. Deal Market In A Race To Transform

“The U.S. deal market is in a race to transform, quickly shifting from defense to strategic offense,” said Malinda Gentry, EY-Parthenon Americas TMT and telecommunications leader.

She noted that September’s mega-deal value jumped 176 percent year-over-year – evidence that capital is moving aggressively toward growth opportunities in technology and infrastructure.

“The reemergence of private equity in high-value transactions signals both confidence and competition.”

Technology remains the clear engine of M&A growth, with firms blending hardware, software, and data services to gain control of the customer experience. Many companies are using joint ventures and alliances, particularly in AI and infrastructure, to scale data capabilities faster than traditional acquisitions allow.

This pivot to technology-driven consolidation underscores how rapidly strategic priorities are changing. “The acquisition mandate is simple: secure AI or fall behind,” Ms. Gentry said.

Private Equity Firms Focusing On Recurring Revenue Models

Private equity accounted for 60 percent of large-deal value in September, up sharply from 45 percent in August, according to EY.

That rebound reflects renewed sponsor confidence, clearer financing visibility, and record dry powder waiting to be deployed. PE firms are focusing on sectors with recurring revenue and scalable data models – especially software, industrial technology, and digital infrastructure.

“The next wave of value creation won’t come from leverage or timing – it will come from people.”

“The reemergence of private equity in high-value transactions signals both confidence and competition,” said Leo Cummings. “Sponsors are looking to get ahead of a lower-rate environment, and those with the best leadership alignment will move the fastest,” he noted.

For PE-backed firms, leadership continuity is becoming a defining factor in post-deal performance.

“The next wave of value creation won’t come from leverage or timing – it will come from people. Investors are realizing that leadership execution determines whether M&A momentum becomes sustainable growth,” said Mr. Cummings.

Private Equity Places Big Bet On Heidrick & Struggles

One of the clearest signals of private equity’s growing confidence came from the $1.3 billion acquisition of Heidrick & Struggles by Advent International and Corvex Private Equity earlier this month. The deal – one of the largest ever completed in the recruiting and leadership advisory sector – highlights how private capital is moving deeper into professional services, viewing human capital as a scalable, high-return investment category.

Read more: The Big Bet Private Equity Just Placed On An Executive Search Firm

“The Heidrick transaction marks an inflection point for the broader leadership and talent advisory industry,” said Scott A. Scanlon, co-founder & CEO of Hunt Scanlon Ventures.

“The Heidrick transaction marks an inflection point for the broader leadership and talent advisory industry.”

“Private equity’s entrance at this level will further accelerate consolidation across the executive search sector as investors look to acquire firms with brand credibility, recurring advisory revenue, and global reach,” he noted.

M&A Deal Activity To Remain Strong In Q4

EY expects deal activity to remain strong through the end of the year as the Federal Reserve begins to ease policy and regulatory clarity improves. The firm’s economists project that as financing conditions loosen, the backlog of delayed transactions will begin to clear, setting up a “busy and strong” finish to 2025.

“Capital, technology, and leadership are converging – and the firms that manage all three with discipline will define the next cycle of growth.”

However, policy risk remains. Tariff decisions and Section 232 investigations are creating uncertainty for cross-border deals, especially in manufacturing and energy. EY analysts note that clarity on trade and regulation will be essential for sustaining momentum in early 2026.

“The market is entering a decisive phase,” said Mr. Cummings. “Capital, technology, and leadership are converging – and the firms that manage all three with discipline will define the next cycle of growth.”