00:00I'd love to get a sense of the mood. It was only a couple weeks ago or last week that
00:03Jamie Dimon
00:04basically said everybody's gung-ho, clients are roaring, M&A is coming back. I wonder if you're
00:09seeing that too. Is it all cylinders firing or is there a little bit of caution right now?
00:15Well, I think it's important to just take a step back and think about where we are in the M
00:19&A
00:19market and just contextualize it for a bit, right? So first quarter of 2026, we saw global M&A deal
00:26volume go up to $1.2 trillion, a 25% increase over where we were at this time last year.
00:32But we saw deal count actually drop by 15%. And so what you're seeing is you're seeing some mega
00:39deals that are really propelling the M&A market going forward. And it's interesting, if you look
00:44at that $1.2 trillion, half of that was actually 48 M&A deals that were over $5 billion and
00:51more.
00:52And so you're seeing a lot of high conviction strategic M&A transactions and even some private
00:57equity that are big ticket items where high value, large numbers, but you are seeing some
01:04stagnance in the mid-market.
01:06See, that is interesting that private equity has been active in some areas. I think one of
01:11the latest statistics I saw was overall for PE, volumes were down something like 20%. But maybe
01:16it's just because it's only the big going. What does it take to get the rest of sponsors
01:20participating in this M&A move?
01:22Well, I think if you actually look at Q1 of 2026, private equity volume was up 9% year
01:28over year. And deal count was relatively flat. And so there are definitely pockets of the
01:33market that aren't doing as well. But overall, I think we're seeing a rebound, particularly
01:38when you look at where we were in 2024. So 2024, all time, five-year low for private equity.
01:45And then we saw a resurgence in 2025, up 50%. And we think we're going to continue to see
01:52that into 2026. And why do I think that? Number one, fundamentals are still there. There is a ton
01:59of dry powder out there. Financing is available. And you have these private equity sponsors that
02:06have a massive backlog of assets that they need to monetize. But what I've actually found that's
02:11been interesting, and I've been hearing it more and more from clients in the last couple of weeks,
02:16is that there's this growing sentiment that volatility and uncertainty are here to stay.
02:21So it's almost an acceptance that this is the new normal. And there's a growing reluctance to sit
02:27on the sidelines and wait around for perfect conditions, because folks are realizing there's
02:31a real opportunity cost to that. So I'm seeing more and more clients sit back and say, I think I'm
02:37ready to move into this market, even though it's not perfect. Interesting. Is that across asset
02:41classes? Or do you think, I mean, software to be really specific, that software remains
02:45just frozen at this moment for deal activity? I wouldn't say it's frozen. Is it slower than
02:50other sectors? Sure. Is there more reluctance? But what's interesting is I have a lot of private
02:55equity clients that invest in the software sector. And what some of them are saying is it's actually
02:59an opportunity because there's a lot of folks that are more reluctant to get into the market right now.
03:05So they're trying to kind of flip that script a little bit and really focus on buying opportunities
03:09where they see that there's a strategic value add. By the way, how much of your business has
03:13started to revolve around the creative liquidity solutions, if you will, around continuation
03:18vehicles, around secondaries? Are you seeing a lot of volume there? So much of the capital markets
03:24and capital products have evolved in a way that's super, super exciting, right? When you look back 10
03:30years, private equity was thinking, well, we're going to IPO or we're going to sell to a strategic
03:34or we're going to sell to a sponsor. And today there are so many options. And it's interesting
03:40you bring up secondaries and continuation vehicles because I think that is actually the one thing
03:45that is going to propel the private equity exit market in 2026 and beyond. So it's actually
03:51fascinating. If you look at 2025, there was $240 billion of secondary transactions, which itself
03:59was up 50% year over year. If you look at 2013, there was $26 billion. And so you're seeing
04:06a 10x increase
04:07over just about a decade. And it's really interesting because it's not just coming on the GP side. It's LPs
04:13and
04:14GPs. So you're seeing LPs, half of which are pension funds, using secondaries to rebalance their portfolios,
04:22to get liquidity, to solve allocation issues. And then, yes, you're seeing GPs in a continuing amount
04:28of the market come in and use continuation vehicles to hold on to assets that they don't want to sell
04:33at what they see as a depressed valuation while giving the LPs some liquidity. And so that is going
04:39to continue. That sector is going to grow. And you're going to see fundraising continue to grow.
04:44And I actually have been seeing in the asset management M&A side of my practice,
04:48a real push for large asset managers to make sure they have secondaries platforms.
04:53Well, I actually wanted to ask about that part of your business in particular,
04:56because I know you oversee it. And it feels like there's always a conversation at Super Returner.
05:00We're going to see some real consolidation within private equity managers, within private credit.
05:05Are you getting that flavor? Are you also hearing noise out there that there are some people who are
05:09seriously looking at consolidation in this industry?
05:12Absolutely. Consolidation is a trend and it's continuing. So GP, minority deals,
05:18control deals up 40% year over year. And even into 26, we've seen some big deals. And I can
05:24tell you
05:24just looking at my docket and what's in the backlog, there might be some big things coming.
05:28And so it is an area where we're seeing a lot of consolidation because you have these large asset
05:34managers that want to scale. They want to grow AUM. They want to go FRE. And they want to aggregate
05:41talent. And they want to diversify their products. And they want to diversify their geographies.
05:46And oftentimes, folks think the easiest way to do that is to buy instead of build.
05:51But then you have it on the other side, too. We're in a fundraising environment that is favoring
05:55the large. 60% of all LP capital last year went to six managers. And so even fantastic middle market,
06:03lower to middle market managers aren't really able to fundraise in the way they could. And they see
06:07the value of going on to a bigger platform and getting more capital to invest in their businesses
06:12and just being part of a bigger organization. So we're seeing sort of push-pull factors on both
06:17sides that are creating a perfect environment for more consolidation. So prediction for end of 2026
06:23into 27, absolutely going to continue.
06:26By the way, I know you can't give us names, but what does it look like, I guess? Is it
06:29funds that
06:30want to be, that come together and just automatically be the size of one of the big public platforms?
06:36Like you need to consolidate and try to achieve a Blackstone or an Apollo or an Aries side. Is it
06:42that level of consolidation? Is it mega deals that we should be expecting?
06:46I think for the most part, what we've been seeing and what I would expect to see is larger managers
06:51building onto parts of their platform that they're weaker in. And so it's not necessarily
06:56McDonald's buying Burger King, but it's sort of McDonald's buying a smaller fast food franchise
07:01in one state that it doesn't have many McDonald's in, right? So that's where I think we're going to go
07:06in the future. So a lot of deals are happening in AI. I'd also, though, just be curious, Alex,
07:11about how you and your team are using AI day-to-day. I know it's a little bit tricky with
07:15law firms
07:16because there's certain data privacy requirements. How pervasive has it come in the work that you do
07:21in your team and the amount of AI that's being incorporated into their day-to-day workflow?
07:25It's become extremely pervasive. I mean, AI is a phenomenon. It is really something that is going
07:32to change the way the business operates, our business operates, and it's something that
07:37our clients and us think about on a day-to-day basis. It is making us faster. It's making us
07:42more efficient. It's making us smarter. And it's just overall making us better at what we do.
07:47So we are constantly evaluating how to incorporate it into our workflows. There's not a deal that's
07:52getting done at Latham today that is not incorporating AI to make us better, faster,
07:57smarter. How do you think, because some of your competitors, Kirkland, for example,
08:00partners with Palantir, tries to build something in-house. How are you and the team thinking about
08:04what tools make the most sense? Ones that already exist, some of the startups out there are trying
08:08to develop things more in-house. Yeah, you know, we have a massive team that is 100% focused on
08:15making sure we have the tools that fit our business. And it's a combination of different things.
08:19The interesting thing, I would say, taking a step back about large law firms like Latham is we have
08:25so much proprietary data. We are a 4,000-person organization. We are in every major geography.
08:32We are in every major product class. We are seeing more deals than anyone else on the capital market
08:37side and on the M&A side. And it gives us a really good sense of the market. So what
08:41we're focused on is
08:42how do we think about incorporating that data and helping it drive the market and give our clients
08:48better advice about what they're going to see in the market and what the terms for their
08:51transactions should end up being. We should just end there about what you see in the market. I
08:55already gather that you feel quite optimistic about secondaries volume, deal volume more broadly.
09:00What does the second half of 2026 look like in your estimation? I'm very optimistic. You know,
09:06it's a little bit, there are some really strong parallels to what we saw in 2025. So in 2025,
09:11we went in super excited. And then there were some headwinds, right? And then we saw a massive
09:18increase in uptick in deal activity in the second half. And that's really what I'm expecting here.
09:23Same story. We went into 2026 and very optimistic. And then we had some different headwinds. But I am
09:30seeing, for all the reasons we talked about before, the fundamentals being there, client sentiment,
09:35client confidence, I think we're going to end the second half of 2026 stronger than we started.
09:40Deja vu. But a good deja vu. I hope so. Alex, thank you so much. This is really wonderful.
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