Exploring the Impact of Tariffs and Economic Uncertainty on M&A: Insights from Mark Thierfelder, Co-Chair of Dechert
Mark Thierfelder, the co-chair of Dechert, recently joined CNBC’s ‘Power Lunch’ to discuss the current state of mergers and acquisitions (M&A) in the context of tariffs and economic uncertainty. Thierfelder, a professionally educated and intense legal expert, shared his perspectives on how these factors are influencing dealmaking.
Tariffs: A Double-Edged Sword for M&A
According to Thierfelder, tariffs can have a dual effect on M&A transactions. On one hand, they can deter deals, particularly those involving companies in industries heavily impacted by tariffs. The added costs and potential disruptions can make potential acquisitions less attractive. Additionally, the uncertainty surrounding tariffs and their potential impact on profits can make valuations more challenging.
Dealmaking in an Economically Uncertain Environment
Thierfelder also addressed the broader issue of economic uncertainty and its impact on M&A. He noted that dealmaking in uncertain economic conditions can be more complex and time-consuming. Due diligence becomes more thorough, and negotiations can be more protracted. However, economic uncertainty can also create opportunities for profit-focused companies to acquire distressed assets at attractive prices.
Personal and Global Implications
For individuals, the economic uncertainty and potential for increased M&A activity can mean both opportunities and challenges. Those in industries less impacted by tariffs and economic uncertainty may find themselves in high demand, as companies look to bolster their workforce and capabilities. However, those in industries facing disruption or declining profits may face layoffs or unemployment.
At a global level, the impact of tariffs and economic uncertainty on M&A can have far-reaching consequences. Cross-border deals may become more complex and time-consuming, as governments seek to protect their industries and economies. This can lead to a slowdown in global M&A activity, potentially impacting economic growth and job creation.
Conclusion
Mark Thierfelder’s insights provide valuable perspective on the current state of M&A and the role that tariffs and economic uncertainty are playing. As we navigate this complex economic landscape, it is crucial for individuals and organizations to stay informed and adapt to the changing environment. By understanding the potential implications of tariffs and economic uncertainty, we can better position ourselves to capitalize on opportunities and mitigate risks.
- Tariffs can deter M&A deals, particularly in industries heavily impacted
- Economic uncertainty can make dealmaking more complex and time-consuming
- Opportunities for profit-focused companies in distressed industries
- Individuals in industries less impacted may find themselves in high demand
- Global M&A activity may slow down, impacting economic growth
