M&A Deal Terms Report November 2025: Earn-outs and vendor loans on the rise across Europe

‍Published: 20 November 2025, Dealsuite

Across the European mid-market, an increasing number of M&A transactions now include deferred payment structures such as earn-outs and vendor loans. These structures reflect a growing emphasis on balancing risk and reward between buyers and sellers, particularly in a market shaped by economic uncertainty and tighter financing conditions.

This is one of the key findings from the Dealsuite M&A Deal Terms Report, a European-wide study analyzing the deal terms used in Share Purchase Agreements (SPAs) for small and mid-sized transactions. The research is based on first-hand data from 959 legal firms across Europe, collectively responsible for a substantial volume of completed transactions between July 2024 and June 2025.

Deferred payments increasingly common

Dealsuite data on the first half of 2025 already showed that 42% of M&A advisors saw an increase in the use of earn-outs in recent transactions, while vendor loans are also gaining popularity as a financing tool. New data now shows over half of the transactions including an earn-out the deferred portion represented 10–20% of the total purchase price. In 34% of transactions, seller financing was arranged through a vendor loan.

According to Dealsuite, these trends point to a market in which parties are finding creative ways to close deals despite uncertainty. “A decade ago, market turbulence often paralysed M&A activity. Today, many dealmakers have adapted to operating in an environment where uncertainty is constant. This resilience is particularly visible in the SME segment, where we continue to see healthy deal flow and an evolution in deal structures that share risk more evenly between buyer and seller. It is a sign of a more mature and strategic M&A market in Europe.” notes Floyd Plettenberg, CEO at Dealsuite. 

Warranties and indemnities remain key risk allocation tools

Warranties and indemnities continue to play a central role in transaction agreements, ensuring risk allocation between buyers and sellers. Nearly all transactions (99%) included warranties, and 81% contained one or more indemnities, most often related to tax matters and risks identified during due diligence.

Furthermore, 30% of M&A advisors indicated that the use of warranties and indemnities as deal terms has increased in the first half of 2025, signalling heightened attention to risk management in negotiations.

Rising demand for deal certainty and security

To secure post-closing obligations, solvency maintenance statements were the most common form of security, applied in 71% of transactions. Meanwhile, instruments such as holdbacks and personal guarantees, are being used to ensure that claims can be covered if issues arise after completion.

M&A insurance, once reserved for large-cap transactions, is now a growing feature of mid-market deals. “While M&A insurance has long been standard practice in large-cap transactions, we now see strong uptake in the SME segment as well,” notes Peter Zwijnenburg, Managing Director at Aon. “These solutions have become more accessible, streamlined, and competitively priced, making them a realistic option for a much broader range of deals.”

Non-compete clauses standard in 96% of transactions

To protect goodwill and client relationships, almost all SPAs included non-compete and non-solicitation clauses. In 64% of cases, these restrictions lasted between 12 and 24 months, while 30% extended up to three years, confirming that protecting the acquired company’s market position remains a key priority for buyers.

European benchmark for M&A deal terms

The Dealsuite M&A Deal Terms Report provides a European-wide benchmark for legal terms in SME transactions. By analyzing real SPAs prepared by M&A legal advisors, the report offers a data-driven view of how transactions are structured across Europe’s mid-market.

“Our goal is to make the M&A market more transparent and data-informed,” says Floyd Plettenberg, CEO at Dealsuite. “By sharing insights from legal advisors across Europe, we can help M&A professionals make better decisions and improve deal outcomes.”

About the report

The M&A Deal Terms Report is an annual study by Dealsuite, examining how deal terms are applied in practice across Europe. The report covers key legal elements including purchase price mechanisms, conditions precedent, warranties, indemnities, securities, and non-compete clauses.

About Dealsuite‍

Dealsuite is Europe’s largest M&A network and the industry standard for deal sourcing, connecting over M&A advisory firms, investment companies, and corporate M&A teams across 60 countries. The platform enables professionals to source deals efficiently, share opportunities, and collaborate across borders.