Artificial intelligence (AI) is reshaping the M&A landscape, improving execution speed, accuracy and analytical depth. As dealmaking becomes increasingly complex and data-intensive, AI’s adoption is accelerating across due diligence, valuation, target identification and post-merger integration.
In diligence, AI tools are enhancing document review, risk identification and contract analysis. Natural language processing allows large volumes of legal, operational and financial data to be processed in a fraction of the time required by traditional methods. This efficiency reduces both deal timelines and the likelihood of oversight.
For target screening and valuation, machine learning models are enabling faster analysis of vast market data sets, identifying patterns that may not be visible through conventional financial modeling. Private equity firms and strategic acquirers are leveraging these insights to refine pipeline development and assess synergies with greater precision.
AI is also playing a critical role in post-merger integration. Predictive analytics help anticipate integration challenges, model workforce attrition and optimize go-forward organizational structures. This foresight contributes to improved value capture and smoother transitions post-close.
Despite its utility, AI is not a substitute for strategic judgment. Limitations in data quality, explainability and context awareness necessitate human oversight. This is particularly relevant for smaller-sized deals with less sophisticated systems and lower transaction volumes from which to perform analysis and form conclusions.
Effective application of AI on deals is not a one-size fits all approach, with thoughtful deal-specific strategy required. Successful implementation also requires coordination between deal teams, technology providers and functional stakeholders.
As AI tools continue to mature, their impact on M&A efficiency and competitiveness will likely expand. Firms that adopt and adapt effectively will be positioned to drive better outcomes across the transaction lifecycle.
M&A Market Activity
U.S. deal volume in June 2025 rose by 1.9 percent as compared to June of the prior year, but YTD volume still lagged behind the prior YTD period by 2.6 percent. Conversely, deal value in H1 2025 outperformed the prior year by 12.5 percent. An increase in mega-deals, by both strategic and PE-backed platforms, drove the increase in deal value, with a large amount of the enterprise value related to AI and tech-focused acquisitions.
The Cleveland M&A market experienced an uncharacteristically slow June that resulted in 30 percent fewer transactions completed than in the same period in 2024. However, there are still several noteworthy transactions completed by both strategic acquirers and private equity firms. RPM International, ACU-Serve, Foundation Software, and Unison Risk Advisors all completed strategic acquisitions, while Cyprium Investment Partners completed a significant platform investment. Additionally, Triad Personnel Services, Cleanland Car Wash, and A&A Management Group all realized successful exits during the month.
Deal of the Month
On June 11, 2025, Strongsville-based Foundation Software LLC, the nation’s leading provider of construction software and services, announced its acquisition of Vendrix, Inc., a construction financial management platform offering corporate cards, expense management, AP automation and bill pay solutions. With the addition of Vendrix’s expense management and AP capabilities, Foundation Software now offers digital tools that cover nearly every stage of a construction project — giving contractors complete control throughout the project’s lifecycle.
“Vendrix is construction-focused like us, and they handle an important part of the financial process that our users have been asking for,” said Mike Ode, CEO of Foundation Software. “It has been our goal to build a comprehensive digital solution to cover the full lifecycle of a construction project, and this acquisition helps us achieve just that. I can’t wait to see all the ways our clients benefit from this addition.” ●
Sources: PitchBook™, S&P Capital IQ, company websites, and public company filings.
Daniel M. Bowman is a Director and Principal at MelCap Partners LLC, a middle-market investment banking advisory firm. For more information on MelCap Partners, please visit www.melcap.com or email [email protected].
