As chairs of the American Bar Association’s Private Target Mergers & Acquisitions Deal Points Study (the Private Target Deal Points Study), we are pleased to announce that we published the latest iteration of the study to the ABA’s website on December 16, 2025.
Congratulations! But Wait. What Exactly Is This Private Target Deal Points Study, Anyway?
The Private Target Deal Points Study is a publication of the Market Trends Subcommittee of the ABA Business Law Section’s M&A Committee. It examines the prevalence of certain provisions in publicly available private target mergers and acquisitions transactions during a specified time period. The Private Target Deal Points Study is the preeminent study of M&A transactions, widely utilized by practitioners, investment bankers, corporate development teams, and other advisors.
The 2025 iteration of the Private Target Deal Points Study analyzes publicly available definitive acquisition agreements for transactions executed and/or completed either during calendar year 2024 or during the first quarter of calendar year 2025. In each case, the transaction involved a private target acquired by a public buyer, with the acquisition material enough to that public buyer for the Securities and Exchange Commission to require public disclosure of the applicable definitive acquisition agreement.
The final sample examined by the 2025 Private Target Deal Points Study is made up of 139 definitive acquisition agreements and excludes agreements for transactions in which the target was in bankruptcy, reverse mergers, and transactions otherwise deemed inappropriate for inclusion.
Although the deals in the 2025 Private Target Deal Points Study reflect a broad array of industries, the health care and technology sectors together made up over 20% of the deals. Asset deals comprised 21% of the study sample, with the remainder either equity purchases or mergers.
Of the 2025 Private Target Deal Points Study sample, 42 deals signed and closed simultaneously, whereas the remaining 97 deals had a deferred closing some time after execution of the definitive acquisition agreement.
The transactions analyzed in the 2025 Private Target Deal Points Study were in the “middle market,” with purchase prices ranging between $25 million and $900 million; purchase prices for a majority of deals in the data pool were below $200 million.
The Private Target Deal Points Study Sounds Great! How Can I Get a Copy?
- All members of the M&A Committee of the Business Law Section received an email alert from Jessica Pearlman with a link when the study was published. If you are not currently a member of the M&A Committee but don’t want to miss future email alerts, committee membership is free to Business Law Section members, and you can sign up on the M&A Committee’s homepage.
- ABA members who are not currently members of the Business Law Section can sign up to join on the Section’s membership webpage.
- The published 2025 Private Target Deal Points Study is available for download by M&A Committee members from the Market Trends Subcommittee’s Deal Points Studies page on the ABA’s website. Also available at that link are the most recently published versions of the other studies published by the Market Trends Subcommittee, including the Canadian Public and Private Target M&A Deal Points Studies, European Private Target M&A Deal Points Study, US Public Target Deal Points Study, and Strategic Buyer/Public Target M&A Deal Points Study.
How Does the 2025 Private Target Deal Points Study Differ from the Prior Version?
The 2025 version of the Private Target Deal Points Study has a number of features that differentiate it from prior iterations.
- Earnouts: Earnouts became less prevalent and displayed some buyer-friendly features. Use of earnouts decreased from 26% during the period covered by the 2023 Study to 18% during the period covered by the 2025 Study. Earnouts are often used to address valuation gaps, and this data point suggests that valuation gaps narrowed somewhat during the period covered by the 2025 Study.
- RWI: The use of representations and warranties insurance (RWI) increased compared to the prior Study. 63% of deals during the period covered by the 2025 Study referenced RWI (our proxy for whether a transaction utilized RWI) as compared to 55% of the deals during the period covered by the 2023 Study.
- No Survival Deals: Deals that provide that representations and warranties do not survive closing increased from 30% in the prior Study to 41% in this Study. This increase is likely related to the increase in RWI deals.
- Indemnification for “Actual” vs. “Alleged” Breaches: Indemnity coverage for alleged breaches increased from 17% from to 27% in this year’s Study; this appears to also be driven by an increase in RWI deals.
- Single vs. Double Materiality Scrape: The use of double materiality scrapes increased from 69% to 82% in the prior study. Again, this increase appears to be related to the increase in the use of RWI.
- New Data Points: We added a few additional data points. Look for the “new data” flags (see samples below) to make them easy to spot.
Transaction Expenses as Part of Post-Closing Adjustment. We added a data point to track how often transaction expenses are taken into account in the post-closing purchase price adjustments.- Existing Fact/Condition as Part of MAE Definition. We wanted to see how often deals that include the definition of “Material Adverse Effect” (MAE) specify that a fact or condition existing at the time of signing the acquisition agreement could constitute an MAE, so we added that data point to this year’s Study.
- Control of Defense of Third Party Claims—Failure to Adequately Defend and Government Authority Involvement. We have added to this year’s Study a data point on how often the failure/inability to adequately defend a claim could result in a loss of the indemnifying party’s right to control defense of that claim. We added a similar data point on claims involving government regulatory authority.
- Fraud as a Standalone Indemnity. We added a data point tracking how often fraud is included in purchase agreements as a standalone indemnity.
Please join us in extending a huge thank-you to everyone who worked so hard on this study, from leadership to advisors to issue group leaders to the working groups, all of whom are listed in the credits pages.
For more information, at 1:00pm EST on February 10, 2025, there will be an In the Know webinar with the Study Chairs and Issue Group Leaders providing analysis and key takeaways from the results of the Private Target M&A Deal Points Study.
