War with Iran may slow the pace of dealmaking but it’s unlikely to dent overall M&A activity, according to Lazard Inc.’s global head of mergers and acquisitions.
“The key question for the Iran conflict is the duration — how long will it last,” Mark McMaster said, adding that investors are watching oil prices, inflation and potential supply-chain disruptions. A short-lived conflict would likely allow dealmaking to proceed with limited interruption, he said Wednesday in a Bloomberg TV interview.
Beyond geopolitical uncertainty, McMaster pointed to several trends supporting dealmaking. Large corporate buyers remain active, with deals of more than $10 billion up about 120% from this point last year and now accounting for roughly 30% of the market — a shift he expects to continue.
At the same time, midsize companies are streamlining their portfolios, shedding slower-growing businesses and focusing on areas with stronger long-term growth. McMaster said. Take-private deals are also continuing, particularly among smaller companies that lack scale or face operational challenges.
On financing, McMaster said capital remains available across both public and private markets, though at higher costs. Companies are increasingly pursuing multiple financing options in parallel to secure the best terms.
“Clients are best served to run a dual track and look at both simultaneously,” he said.
Lenders are becoming more selective, with greater emphasis on underwriting standards. “Good companies will get financed and the mediocre companies will probably have more trouble getting financed,” he added
McMaster highlighted persistent valuation gaps in public company deals, with buyers and sellers still struggling to agree on price in volatile markets. Leverage is likely to amplify swings in sectors such as software, he said.
McMaster predicted artificial intelligence will remain a key driver of deal activity, particularly in infrastructure and AI-focused transactions. He said that while 2025 was “an incredible year for software M&A,” uncertainty remains around valuations, especially for private equity buyers.
“The terminal value is the question,” he said. “If it’s private equity, how does that price relate to what we paid for it?”
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