Dealmakers, flush from what could be a record year for mergers and acquisitions, are watching for signs that growing protectionism and anti-globalization movements will dampen some cross-border transactions.

The U.S. trade dispute with China, the U.K.’s decision to leave the European Union and security concerns around technology assets could all affect M&A in the future, panelists said at the XBMA conference in Paris on Tuesday.

Their concerns come against the backdrop of a vigorous market for deals. Global M&A spending has hit $2.7 trillion already this year, up 26 percent from the same period in 2017, according to data compiled by Bloomberg. It’s tied with 2015 as the top year for deals since 2007.

Key Voices

  • “There are more execution risks to M&A than there were a few years ago,” said Gilberto Pozzi, co-head of global M&A at Goldman Sachs Group Inc. “Protectionism is very sector dependent. We’ve seen lots in sectors like technology, for instance, while there’s been healthy cross-border M&A activity in other sectors.”
  • “We’ve increasingly felt as a result of protectionism and populism that our local presence in foreign markets,” with people on the ground who have a stake there, is the right thing, said Rosemary Martin, general counsel for Vodafone Group Plc.
  • “M&A activity is doing well with globalization. It will do badly with de-globalization,” said Pascal Lamy, a former director general of the World Trade Organization and a senior adviser to Brunswick Group.
  • “The previous U.S. policy was to contain China. The new policy is to push back China,” Lamy said. It’s “unclear” if President Donald Trump will succeed in de-globalizing the U.S. and China, he said.
  • “We need to be significantly more diligent when it comes to planning the deal pipeline, including engaging with stakeholders early because of political sensitivities around some of the assets,” said Henrik Brandt, chairman of Rockwool International A/S.


Still, disruption to the regulatory, political and technological environment may encourage deals as companies are forced to find ways to adapt, said Jeffrey Rosen, deputy chairman of Lazard Ltd. Activists are also influencing how executives think about transactions, he said.

  • “Both boards and CEOs today need to look much more in the rearview mirror to see what threat of activist investor opposition you face,” Rosen said. This has inhibited decision making, but companies are still doing deals, he said.
  • “There is no single Europe when it comes to cross-border transactions,” he said. “That could inhibit some of the consolidation necessary to deal with the disruptions we are seeing.”
  • Telecommunications is one area that needs to consolidate, particularly as carriers face the prospect of building out high-speed, fifth-generation mobile networks and could find that scale helps offset costs, he said.

The International Roundtable Symposium on Cross-Border European M&A is an annual event of company executives, lawyers and investment bankers to encourage dialog and analysis on the market dynamics that fuel M&A.