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Morgan Stanley Says AI Is Rewriting the M&A Playbook
Top banker says companies without credible AI strategy risk being left behind as acquirers and targets
Apr. 1, 2026 at 8:05pm
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According to Morgan Stanley's global co-head of M&A, Tom Miles, artificial intelligence is becoming central to how corporate deals are evaluated and executed globally. Companies that fail to articulate a credible AI strategy risk being left behind, both as acquirers and as attractive targets, as AI is reshaping the entire M&A landscape.
Why it matters
AI is no longer a sideshow in corporate dealmaking - it is now the main event. Companies across industries are reassessing their competitive position, cost structure, and growth assumptions through the lens of AI capabilities. Startups with differentiated AI technology and strong product-market fit are in high demand, while those without clear technical moats face a much harder road.
The details
Global M&A activity has been rebounding after a brutal 2023, but the recovery is uneven. AI-related transactions are shouldering a disproportionate share of the momentum, as big companies are buying AI startups at a furious pace. But the deeper shift is that AI is forcing virtually every industry to rethink their approach to deals. Boards and CEOs are now evaluating potential acquisitions with AI front of mind, whether they run a logistics company, healthcare provider, or financial services firm.
- Over the past 18 months, AI-powered companies like Databricks, Anthropic, and Mistral have commanded multi-billion-dollar valuations in funding rounds.
- Thoma Bravo's acquisition of a majority stake in AI-powered legal research company CaseText, and Cisco's $28 billion proposed acquisition of Splunk, both signaled a broader appetite among large enterprises and private equity firms to pay significant premiums for AI-adjacent capabilities.
The players
Tom Miles
Morgan Stanley's Global Co-Head of M&A.
Dani Burger
Bloomberg's reporter who interviewed Tom Miles.
What they’re saying
“AI is no longer a sideshow in corporate dealmaking. It is becoming the main event.”
— Tom Miles, Global Co-Head of M&A, Morgan Stanley
What’s next
Regulatory agencies in the US and Europe have signaled increased scrutiny of AI-related acquisitions, particularly when large platforms acquire smaller rivals that could become competitive threats. The Federal Trade Commission's ongoing review of several major tech deals underscores this trend. Additionally, interest rates remain another variable, as elevated borrowing costs mean buyers are being more selective and leaning toward targets with proven revenue models rather than speculative growth stories.
The takeaway
AI is no longer a feature to bolt onto a pitch deck - it is a fundamental lens through which every potential deal is being evaluated. Companies that can demonstrate how their AI capabilities translate into measurable efficiency gains, cost reductions, or new revenue streams will command premium valuations, while those that cannot will struggle to get serious attention in a fast-moving market.
