Truist Securities Forecasts Strong M&A Activity in 2025

Truist Securities is feeling hopeful about an increase in mergers and acquisitions within the gaming sector. This could mark the end of a period of low M&A activity.

During the Wicked Good 12th Annual GLLR Summit in Boston, Truist Securities pointed out several favorable conditions that could spark a surge in M&A transactions. These include the recent reduction in interest rates and the upcoming term of President Trump.

President Trump, known for his business background, has always worked towards creating favorable business conditions. With the expectation of sustained low interest rates during his term, companies in the gaming sector and beyond may be more inclined to consider mergers and acquisitions.

Barry Jonas, Truist managing director, expressed his team’s belief that 2025 will be a significant year for gaming operator mergers and acquisitions. With supportive regulations and low interest rates, the groundwork is laid for a year of active M&A deals.

Jonas emphasized that factors like value expectations and bid/ask spreads will play a crucial role in such transactions. However, while there is optimism for increased M&A activity, it’s essential not to get overly hopeful just yet. Analysts had similar hopes for 2024, which saw a few major deals but fell short of high expectations.

Another positive factor that might contribute to enhanced M&A bids is the potential change in FTC leadership. President-elect Trump nominated FTC Commissioner Andrew Ferguson to chair the commission, replacing current chair Lina Khan. This shift is expected to create a more business-friendly environment for companies pursuing M&A bids.

In addition to M&A activity, Jonas also predicted the possibility of online gaming spinoffs within the broader casino and sports betting sectors. Some operators, like Penn, have seen their online businesses outshining their land-based counterparts. Meanwhile, Caesars has faced challenges with its digital business affecting its share price and could consider spinning it off.