Peter Jones, Partner in Sullivan & Cromwell’s M&A, Technology, Digital Infrastructure and Private Equity Groups, discussed the recent surge in AI dealmaking at the sub-$300 million end of the market with Law360, particularly as driven by demand for AI talent and technological advantages. Peter described the “AI arms race” pushing buyers to make small bets and move quickly on acquisitions that may offer strategic advantages. “There’s a desire to hoover up and acquire AI talent, and the team is really the asset in a lot of the deals,” he said.
Peter noted that many of these situations reflect acquirers’ long-term plans to absorb a company’s engineers and other key employees, as well as the potential to secure intellectual property. “There is a focus to fill product gaps, but also to stop certain assets falling into the hands of competitors,” he explained.
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