A dramatic shift in global M&A: US acquisitions of European targets dropped 60%, signaling a fundamental change in transatlantic capital flows. The freeze reflects regulatory friction, geopolitical tension, and strategic reassessment on both sides of the Atlantic.
The decline isn’t cyclical—it’s structural. European regulators have become more aggressive, particularly around tech and data. US companies face longer timelines, more conditions, and higher rejection risk. The calculus has shifted: European acquisitions now carry friction that domestic or other-region deals avoid.
The Regulatory Factor
Europe’s regulatory posture has hardened. GDPR, the Digital Markets Act, and increasingly assertive competition authorities create compliance burdens that complicate integration. For acquirers, these aren’t just costs—they’re strategic uncertainties that discount deal value.
This represents regulatory moats in action, but protecting domestic companies rather than benefiting them. European targets become less attractive not because of their quality but because of the friction of acquiring them.
Strategic Implications
For European companies seeking exits, the shrinking US buyer pool reduces options and likely valuations. For US companies, European expansion increasingly requires organic growth rather than acquisition—slower and riskier.
The deglobalization trend finds expression in M&A markets. Capital that once flowed freely across the Atlantic now faces friction that redirects it elsewhere.
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