Showing Resiliency: Q2 2025 M&A Activity

The only certainty in M&A during the second quarter was the uncertainty. Following a promising start to the year, the M&A market experienced an abrupt but brief slowdown as investors paused to assess the impact of tariffs and geopolitical uncertainty. By mid-quarter, some of those fears eased. KSM’s deal activity came flooding back, with motivated buyers and sellers ready to make deals on expedited timelines.

KSM’s transaction advisory team navigated through the uncertainty and currently has over 40 active projects and more than 20 deals in the pipeline. Here is a closer look at some of our second quarter deal activity by sector.

Industrials

Industrial businesses continued to remain strong, showcasing the sector’s enduring appeal to strategic and financial buyers. Highlights from the second quarter include the following closed deals:

• Pipe, valve, and fitting (PVF) supplier operating across the Southeast
• Architectural hardware manufacturer based in the West
• Signage provider based in the West
• Lighting solutions provider based in the Northeast
• Steel fabricator based in the Midwest

Financial

Both strategic and financial buyers continue to seek attractive assets in the financial services sector, with consolidation playing a key role. This trend is reflected in the second quarter closing listed below:

• Wealth management company based in the Southwest

KSM expects this sector to remain active throughout the second half of the year.

Services

Following a strong first quarter, services businesses continued to see meaningful M&A activity, particularly those businesses providing essential or specialized offerings. Buyers continue to value recurring revenue, regional scale, and regulatory expertise in this segment. Second quarter closed deals are highlighted below:

• • Propane distributor based in the Southwest
  • Environmental services provider based in the South
  • Weatherproofing company based in the West
  • Telecommunications service provider based in the Midwest

Technology and Consumer

Deal activity in the technology and consumer sectors gained momentum in the second quarter, driven by renewed buyer interest. KSM is seeing increased activity in both sectors and anticipates this upward trend to continue into the third quarter.

Looking Ahead

Heading into the second half of 2025, market participants remain focused on quality targets, operational resilience, and strategic growth. Despite ongoing macroeconomic variables, the second quarter confirmed that strong fundamentals, sector specialization, and buyer discipline are continuing to drive healthy M&A activity. KSM’s pipeline is robust, with a strong, positive outlook for the remainder of the year.

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