It seems like 2017 will be a strong year for acquisitions. A new report highlights a number of factors that could drive activity this year including the record levels of cash held by private equity firms and a favorable lending environment for borrowers.

Potential changes to U.S. tax policy under the new administration could reduce the corporate tax rate and encourage companies to repatriate offshore cash to invest in acquisitions.

2016 was a year full of uncertainty, from Brexit to the U.S. presidential elections, but as the economic and political landscape stabilizes, business leaders are regaining their confidence. 80% of executives surveyed predict M&A activity will increase in 2017. These market conditions may be the right recipe for increased acquisitions, especially for companies facing poor organic growth prospects.

In the first quarter alone, a number of significant transactions have been announced including the owner of Burger King and Tim Horton’s acquiring Popeyes, Mars acquiring pet hospital company VCA, and Intel pushing into the self-driving car space by purchasing Mobileye. These deals will likely spur additional acquisitions as key players react to changing industry dynamics and competition.

While we don’t know if M&A in 2017 will match 2015’s record level, we can certainly expect an uptick in activity for the remainder of the year.

Photo credit: Igor Trepeshchenok / Barn Images 

Writing this post on November 5th, one is bound to be thinking about the outlook for M&A under a new Democratic government. 

The people I do business with are looking at two major unknowns: tax and regulation. Both are cause for concern as the political map gets redrawn, and both may have a depressing effect on mergers and acquisitions.

At the same time, we should also ask ourselves who might do well under a new regime. Which industries are positioned to take advantage of the change in political climate? For companies considering business acquisitions, it’s a question worth pondering because your acquisition strategy should always be focused where market demand is strong.

Here are a few sectors to watch. Healthcare is almost certainly going to experience quite a shakeup, with significant growth in some areas. Green energy could be in for a substantial infusion of government funds.  If there’s increased investment in infrastructure such as rail and road, opportunities may grow for capital equipment. Generally, companies that directly serve government could do well such as those that supply large IT systems.

These answers are all speculation of course. My point is, the question itself is worth asking — especially as you think about your own acquisition plans.