M&A dealmakers unprepared for recovery, according to WTW survey

ASIA PACIFIC, June 24, 2025 — A majority of companies (54%), expect M&A deal activity to increase despite a record slow start for 2025, according to a survey of senior Human Resource professionals by leading global advisory, broking and solutions company WTW (NASDAQ: WTW). With only 19% anticipating deal activity to decrease, this suggests a wave of deals forthcoming once markets stabilise.

HR teams state that they are under increasing pressure, however, with 65% feeling less than fully prepared to handle their deal portfolio. Respondents acknowledged significant challenges to execute HR due diligence (HRDD), which typically includes a thorough review of a target company's human resources, policies and practices to assess potential liabilities, synergies and risks related to the workforce.

Survey respondents viewed data completeness, quality and integrity as their top due-diligence challenges (66%). Escalating data demands as the time allowed to complete due diligence tightens reinforce the need for sellers to be prepared if they are to maximise deal value. In addition, less than one in five survey respondents believe their HR teams have been properly included in preliminary negotiations.

Max Wright, M&A Consulting Leader for Asia Pacific at WTW, said: “Low deal volumes during the first half of 2025 suggest pent-up demand fueling a new wave of deals when market stability improves. However, a majority of companies have expressed concern about their level of preparedness for future transactions, exacerbated by the possibility that timelines will need to be accelerated if the objective is to complete by year-end.

“The role of HR should already be in full swing even before M&A discussions take shape, looking at the culture, the people, their values and whether they will fit. Proactively assessing people-related challenges and opportunities is critical to enhancing deal value and easing integration.”

The survey also found that 78% of respondents identified key talent with unique or special skill sets below executive level as their highest due diligence priority. The leading metric for integration success was retention of non-executive talent (50%). This was 21% higher than leadership retention (29%). However, resource constraints are rising at a greater rate than culture and technology challenges, with 74% of non-US and 54% of US companies stating that aligning cultures remains the overall top challenge.

“The demand for AI talent has also surged as companies explore how AI can provide a business edge, making it crucial for companies to develop robust strategies to attract, motivate and retain this talent. Strategic deal-making offers a fast and effective way for acquiring key digital skills that would otherwise take years to develop internally. By acquiring companies with established AI and digital teams, companies can plug the talent gaps needed to accelerate their digital transformation and innovation efforts. However, companies acquiring AI talent through M&A will need a special focus on talent assets to ensure the value of the deal stays intact,” added Max.

Meanwhile, 65% believe Gen AI will impact the deal-making process within the next two years. But full buy-in to the value proposition is not there yet, with most in “wait and see” mode rather than being early adopters. Beyond internet scrapes, the most promising emerging areas for using Generative AI are seen as legal analysis and employee communications, with usage significantly falling off beyond this. This suggests a compelling Gen AI use case still needs to be developed to advance adoption within M&A.

The use of virtual data rooms (VDRs) has advanced the means for sellers to post their digital data. But VDRs do not resolve fundamental data integrity issues and can arguably provide a mechanism to overwhelm buyers with mounds of data to disguise issues, compounded in many cases by a narrowing time window to effectively conduct HRDD.

About the Survey

The Barometer Survey is a global survey conducted by WTW every two years to gauge current and future trends in the M&A and divestiture space. For the 2025 survey, WTW surveyed over 80 HR leaders, based in North America, Europe, the Middle East and Asia Pacific, involved in their organisation’s deal-making.

About WTW

At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organisations sharpen their strategy, enhance organisational resilience, motivate their workforce and maximise performance.

Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success - and provide perspective that moves you.