William Blair & Co. LLC's M&A business in Europe has had a strong start to 2026 with activity so far unaffected by recent stock market volatility, according to senior executive Stewart Licudi.
Year-to-date, the US investment bank has a "double-digit total" of deals that have either closed or been signed in Europe, with a transaction value of over $2 billion, said Licudi, head of European investment banking at William Blair. Requests for new deal pitches are still coming in, too, said Licudi, who also chairs the European business's pre-pitch committee.
"Deals are still getting done ... It's not like pitch activity has dried up either; people are still wanting to move forward," Licudi said in an interview with S&P Global Market Intelligence, commenting on the potential impact on M&A activity from heightened volatility after an earlier sell-off of AI-linked stocks and the latest turmoil sparked by the Middle East war.
Investment banks' M&A revenue could take a hit this year if the war lasts longer than a few weeks, with deal activity likely to slow down amid choppy markets and increased economic uncertainty, analysts told Market Intelligence earlier in March.
While the environment has become more uncertain, it is still too early to judge how it will affect the full-year outlook, with current expectations for the M&A business remaining rather positive, according to Licudi.
"We don't ignore these things and just blindly push on, but there's enough of a spread and we have enough volume where we should be able to keep things moving," Licudi said, adding that he gets a similar sense from peers and competitors that he has spoken to.
2025 was a good year for William Blair's European M&A practice, with mandated deals spread across sectors and geographies, and the quality and size of deals improving, Licudi said. The bank won several deals valued at over $500 million, and a couple of $1-billion-plus transactions, Licudi said.
The return of bigger-ticket deals to the market can be attributed to stronger company performance and improving sentiment among private equity (PE) investors, whose readiness to part with portfolio businesses has increased, he said.
Valuation risk
A key risk that could emerge from the recent market volatility is a widening of the valuation gap reflecting price expectations of buyers and sellers in M&A deals, Licudi said. Price expectations have come back together after a few years of dislocation and it remains to be seen whether the turmoil could drive them apart again, especially in tech, he said.
Valuation becomes a big issue during public market volatility spikes and some deals could be put on pause until investors get more clarity on potential corrections in pricing and financing conditions, said Dirk Felsmann, head of financial sponsor coverage for Germany, Austria and Switzerland at William Blair.
Before the Middle East conflict began, there was a market correction in terms of technology and software sector stocks, and after that, the oil price surge brought on renewed volatility and raised inflation concerns, Felsmann said in a separate interview with Market Intelligence.
If the disruption is short-lived and deal activity does not slow down for more than four to six weeks, it would not have a big impact on the full-year 2026 outlook, as activity will probably have time to catch up by the end of the year, he said.
But if it goes on much longer, "then we'll see a much more negative outlook for 2026," he said.
Higher-for-longer oil prices could trigger a re-acceleration of inflation, reducing the chances of central bank rate cuts and keeping financing costs elevated, which would have a "material impact" on PE deal flow, Felsmann noted.
Based on activity so far in 2026, the appetite for dealmaking is there and PE investors seem more open to exit businesses where there is an opportunity to generate a good return than they were 12-18 months ago, Licudi said. Only time will tell whether M&A deals will be pushed back or how that would impact the full-year outlook, according to the executive.
"If we were sitting here in September or October, I might be slightly more concerned about what impact we will have on the year-end," Licudi said.
