Merger Arbs See Wide-Open Deal Window With Biotech Top of List

Merger arbitrage investors — fresh off a boom year for dealmaking — expect no let-up in the trend, with biotechnology firms seen as leading the pack among potential takeover candidates in the first quarter.

Companies worldwide struck almost $5 trillion in merger agreements in 2025, the second most-active year on record and a boon for market specialists who focus on deal-related trading strategies. Transactions proliferated across a number of industries, including megadeals of $20 billion or more such as Union Pacific Corp.’s bid for rival railroad Norfolk Southern Corp. and the record leveraged buyout of Electronic Arts Inc.