Amid Proliferating Warfare, Defense Investors Wait for Federal Uncertainty to Ease

Partner Adam August, who leads the firm's Corporate, M&A and Securities Practice Group in the Mid-Atlantic Region, was interviewed for an article in the Association for Corporate Growth's (ACG) Aerospace and Defense Report examining the current state of the defense mergers and acquisitions (M&A) market. The Trump Administration has made clear its goal of boosting the country's defense capabilities, particularly when it comes to emerging technology, through requesting a 13.4 percent increase in national defense spending and announcing plans to build a Golden Dome Missile Defense Shield. This focus has led to a shift in government procurement strategy, as evidenced by the Department of Government Efficiency's (DOGE) efforts to streamline contract awards and explore alternative bidding processes. Mr. August commented that though these efforts have sparked innovation and investor interest, they have also created uncertainty as contracts deemed non-essential have been canceled and key decision makers have left the federal workforce. Nevertheless, he expects the hesitancy to wane and expressed optimism for future M&A transactions involving defense systems, citing the attraction of joint ventures and investments in defense technology as well as an administration generally seen as favorable to private equity as reasons for an uptick in deal activity.

"(Deal activity) is absolutely going to pick up. I say with confidence that I personally believe Q4 of calendar year '25 or Q1 government fiscal year is when it's going to happen," he said.

READ: Amid Proliferating Warfare, Defense Investors Wait for Federal Uncertainty to Ease (Article begins on page 14)