Carmignac Portfolio Merger Arbitrage Plus: Letter from the Fund Managers - Q4 2025
Dear investors,
During the final quarter of 2025, Carmignac Portfolio Merger Arbitrage Plus (I EUR Acc share class) delivered a positive performance of +0.86% and finished the year up by 4.61%.
Market environnement
The year was overall favourable for the Merger Arbitrage strategy, which demonstrated strong resilience in a sometimes volatile and uncertain market environment. After several more subdued years, 2025 marked a genuine inflection point for global M&A activity, with total deal value rising by more than 40% and the number of announced transactions increasing by 12% year on year.
This recovery proved broad-based and diversified, both across sectors and geographies, and was sustained through to the final month of the year. Deal volumes remained elevated, with several consecutive months above historical averages. The United States accounted for the majority of total deal value, driven by a number of mega-deals, while Europe and Asia, particularly Japan, contributed significantly to transaction volumes, confirming a renewed diversification in geographic activity.
From a sector perspective, Industrials emerged as the primary driver of activity, supported by accelerating investment in electrification, infrastructure and automation linked to the development of artificial intelligence. Healthcare also stood out, underpinned by structurally strong demand, consolidation needs and rapid scientific advances.
Finally, in an environment of gradually declining interest rates, private equity players confirmed their strong return, accounting for a share of acquirers above their historical average and remains a key pillar underpinning M&A activity as we move into 2026.
Performance review
2025 was a strong year for Carmignac Portfolio Merger Arbitrage Plus despite a challenging and volatile market environment. The Fund delivered a performance of +4.61% over the year, representing an excess return of nearly +2.5% above the risk-free rate, while maintaining low volatility below 2% and a contained maximum drawdown of 1.35% during the April market turmoil.
As the Fund approaches its third anniversary in April, it has continued to deliver steady and consistent returns, with a cumulative performance of +11.90% since inception, equivalent to an annualized return of +4.21%. The strategy has maintained a very low correlation with both equity and credit markets, as reflected by an equity beta of 0.03, reinforcing its role as an effective portfolio diversifier.
Performance over the year benefited from the resolution of the Hess litigation, the earlier than expected completion of the Enstar transaction, and several bidding war situations, all of which contributed positively to returns. Conversely, the failure of a few transactions, most notably Bavarian Nordic in the final quarter, weighed on performance.
As shown in the graph below, the bidding wars helped more than offset the negative impact of terminated deals. Moreover, thanks to disciplined risk management, prudent position sizing, and portfolio diversification, the impact of these events remained contained.
Outlook
The past year was further characterized by a record wave of mega deals, reflecting renewed corporate confidence and a willingness to secure strategic assets. The structural drivers underpinning these transactions, including the pursuit of scale, synergies and long-term growth positioning, point to sustained M&A momentum into 2026.
The policy backdrop has also become more supportive. A more pragmatic antitrust stance in the US has encouraged corporates to accelerate transactions and improve execution visibility, reducing uncertainty around deal completion timelines.
At the same time, financial sponsors are back in force, supported by record levels of dry powder and increasing pressure to deploy capital. Private Equity firms accounted for more than 30% of announced deal volumes in 2025, including landmark LBOs, leveraging improved financing conditions and their ability to manage complex execution risks.
Finally, easing inflation and declining interest rates are improving debt affordability and supporting higher leverage transactions, while strong corporate balance sheets allow strategic buyers to pursue growth and synergies with confidence.
In this environment, elevated deal flow combined with attractive spreads creates a particularly compelling environment for merger arbitrage, offering visible, risk-adjusted return potential and meaningful diversification benefits, especially valuable in today’s uncertain macro and geopolitical landscape.
The Merger Arbitrage Team
Carmignac Portfolio Merger Arbitrage Plus
Carmignac Portfolio Merger Arbitrage Plus I EUR Acc
- Duración mínima recomendada de la inversión
- 3 años
- Escala de riesgo*
- 2/7
- Clasificación SFDR**
- Artículo 8
*Escala de riesgo del KID (Documento de datos fundamentales). El riesgo 1 no implica una inversión sin riesgo. Este indicador podría evolucionar con el tiempo. **Reglamento SFDR (Reglamento sobre la divulgación de información relativa a la sostenibilidad en el sector de los servicios financieros, por sus siglas en inglés) 2019/2088. La clasificación SFDR de los Fondos puede evolucionar con el tiempo.
Principales riesgos del Fondo
Gastos
- Costes de entrada
- No cobramos comisión de entrada.
- Costes de salida
- No cobramos una comisión de salida por este producto.
- Comisiones de gestión y otros costes administrativos o de funcionamiento
- 1,12 % del valor de su inversión al año. Se trata de una estimación basada en los costes reales del último año.
- Comisiones de rendimiento
- 20,00 % max. del exceso de rentabilidad cuando la rentabilidad sea positiva y el valor liquidativo supere la cota máxima o «High-Water Mark». El importe real variará en función de lo buenos que sean los resultados de su inversión. La estimación de los costes agregados anterior incluye la media de los últimos 5 años, o desde la creación del producto si se produjo hace menos de 5 años.
- Costes de operación
- 0,23 % del valor de su inversión al año. Se trata de una estimación de los costes en que incurrimos al comprar y vender las inversiones subyacentes del producto. El importe real variará en función de la cantidad que compremos y vendamos.
Rentabilidades
| Carmignac Portfolio Merger Arbitrage Plus | +4,6 | +3,7 | +3,2 |
| Carmignac Portfolio Merger Arbitrage Plus | +4,6 % | - | +4,2 % |
Fuente: Carmignac a 31 de dic. de 2025.
Fecha del primer VL : 14/04/2023.
Las rentabilidades históricas no garantizan rentabilidades futuras. La rentabilidad es neta de comisiones (excluyendo las eventuales comisiones de entrada aplicadas por el distribuidor) El fondo no garantiza la preservación del capital.
La rentabilidad puede aumentar o disminuir como consecuencia de las fluctuaciones de las divisas, en el caso de las acciones que no estén cubiertas por divisas.
Indicador de referencia: -