In a significant escalation of U.S. trade policy, President Trump has introduced a new wave of sweeping tariffs as part of a broader “America First” economic strategy. These measures, designed to address trade imbalances and revive domestic manufacturing, are already sending ripples through global markets and supply chains.
A Bold Return to Tariff-Driven Protectionism
Trump’s approach is rooted in reshoring American jobs and reducing the U.S. trade deficit. In March 2025, his administration announced 25% tariffs on steel, aluminium, and a wide array of other manufactured goods, directly impacting sectors like automotive, electronics, and industrial machinery.
The following month, a 10% baseline tariff was applied to all imported goods, with steeper so-called “reciprocal” tariffs targeting nations with large trade surpluses. While marketed as reciprocal, many of these duties far exceed the tariffs those countries levy on U.S. exports.
China, the primary target, now faces cumulative tariffs of 54% — an additional 34% on top of the 20% already in place. Major exporters like the EU, Japan, South Korea, Taiwan, and Vietnam are also affected, with tariffs ranging from 20% to 46%.
Implications for Foreign Exporters
These changes pose complex challenges for global exporters:
Rising Costs and Lost Competitiveness: Exporters to the U.S. now face significantly higher costs. If these costs are passed through to consumers, foreign products risk becoming uncompetitive in the U.S. market. Alternatively, absorbing the tariffs may protect market share but erode margins.
Supply Chain Disruption: The sudden tariff hikes will likely prompt companies to reevaluate their sourcing and production models, creating a shift away from global supply chains that have defined the past two decades.
Currency Effects: Reduced imports could trigger capital outflows, potentially weakening the dollar. While this may enhance the competitiveness of U.S.-based manufacturing, it introduces currency risk for non-U.S. firms holding dollar-denominated assets or debt.
A Strategic Pivot: Investing Directly in the U.S.
For some foreign firms, the tariffs could act as a catalyst to deepen their U.S. footprint through direct investment.
Greenfield Projects and Joint Ventures: Establishing new facilities or partnering with U.S. firms can provide tariff-free access to the domestic market while building local expertise.
Acquisitions as a Fast Track: Buying an existing U.S. company offers immediate market access, established branding, and integrated supply chains. It also circumvents international shipping and logistics hurdles — often a more efficient route into the market than building from scratch.
However, foreign acquirers should tread carefully:
Regulatory Scrutiny: U.S. antitrust laws are stringent. Acquisitions that raise competition concerns may be reviewed by the FTC or DOJ. Additionally, foreign takeovers, especially by Chinese firms or companies operating in sensitive sectors like technology, may be blocked by the Committee on Foreign Investment in the United States (CFIUS) on national security grounds.
Tariff Due Diligence: Acquiring a U.S. company does not insulate buyers from input tariffs if the target relies on foreign-sourced components. Detailed supply chain mapping and tariff exposure analysis are critical pre-transaction.
Strategic Considerations for Global Businesses
In navigating the new U.S. trade landscape, businesses should weigh the full range of strategic responses:
Reconfigure Supply Chains: Where possible, route goods through tariff-exempt or trade-friendly nations. Shifting production to Mexico or Canada under the USMCA (if it remains intact) could help mitigate exposure.
Evaluate Tariffs vs. Acquisition Costs: While U.S. acquisitions can be capital-intensive, the long-term cost savings from bypassing tariffs may justify the investment — particularly for firms with high export volumes.
Embrace a Flexible Strategy: A combination of tactics — from diversifying export markets and rebalancing supply chains, to strategic investment in the U.S. — will help businesses manage risk while capitalizing on potential new opportunities.
Conclusion
Trump’s aggressive tariff policy is redrawing the map of global trade. For exporters and multinational firms, the road ahead is filled with complexity — but also opportunity. With careful planning and smart execution, foreign businesses can turn this period of uncertainty into one of strategic transformation and long-term growth.
At HMT we are part of the International Corporate Finance Group and our colleagues in the US are well placed to help identify strategic acquisitions locally that may help soften the impact of Trumps tariffs if you can relocate certain aspects of your business to the US domestic market. If you’d like to have a discussion on how we might be able to support you do please get in touch.
In a significant escalation of U.S. trade policy, President Trump has introduced a new wave of sweeping tariffs as part of a broader “America First” economic strategy. These measures, designed to address trade imbalances and revive domestic manufacturing, are already sending ripples through global markets and supply chains.
A Bold Return to Tariff-Driven Protectionism
Trump’s approach is rooted in reshoring American jobs and reducing the U.S. trade deficit. In March 2025, his administration announced 25% tariffs on steel, aluminium, and a wide array of other manufactured goods, directly impacting sectors like automotive, electronics, and industrial machinery.
The following month, a 10% baseline tariff was applied to all imported goods, with steeper so-called “reciprocal” tariffs targeting nations with large trade surpluses. While marketed as reciprocal, many of these duties far exceed the tariffs those countries levy on U.S. exports.
China, the primary target, now faces cumulative tariffs of 54% — an additional 34% on top of the 20% already in place. Major exporters like the EU, Japan, South Korea, Taiwan, and Vietnam are also affected, with tariffs ranging from 20% to 46%.
Implications for Foreign Exporters
These changes pose complex challenges for global exporters:
Rising Costs and Lost Competitiveness: Exporters to the U.S. now face significantly higher costs. If these costs are passed through to consumers, foreign products risk becoming uncompetitive in the U.S. market. Alternatively, absorbing the tariffs may protect market share but erode margins.
Supply Chain Disruption: The sudden tariff hikes will likely prompt companies to reevaluate their sourcing and production models, creating a shift away from global supply chains that have defined the past two decades.
Currency Effects: Reduced imports could trigger capital outflows, potentially weakening the dollar. While this may enhance the competitiveness of U.S.-based manufacturing, it introduces currency risk for non-U.S. firms holding dollar-denominated assets or debt.
A Strategic Pivot: Investing Directly in the U.S.
For some foreign firms, the tariffs could act as a catalyst to deepen their U.S. footprint through direct investment.
Greenfield Projects and Joint Ventures: Establishing new facilities or partnering with U.S. firms can provide tariff-free access to the domestic market while building local expertise.
Acquisitions as a Fast Track: Buying an existing U.S. company offers immediate market access, established branding, and integrated supply chains. It also circumvents international shipping and logistics hurdles — often a more efficient route into the market than building from scratch.
However, foreign acquirers should tread carefully:
Regulatory Scrutiny: U.S. antitrust laws are stringent. Acquisitions that raise competition concerns may be reviewed by the FTC or DOJ. Additionally, foreign takeovers, especially by Chinese firms or companies operating in sensitive sectors like technology, may be blocked by the Committee on Foreign Investment in the United States (CFIUS) on national security grounds.
Tariff Due Diligence: Acquiring a U.S. company does not insulate buyers from input tariffs if the target relies on foreign-sourced components. Detailed supply chain mapping and tariff exposure analysis are critical pre-transaction.
Strategic Considerations for Global Businesses
In navigating the new U.S. trade landscape, businesses should weigh the full range of strategic responses:
Reconfigure Supply Chains: Where possible, route goods through tariff-exempt or trade-friendly nations. Shifting production to Mexico or Canada under the USMCA (if it remains intact) could help mitigate exposure.
Evaluate Tariffs vs. Acquisition Costs: While U.S. acquisitions can be capital-intensive, the long-term cost savings from bypassing tariffs may justify the investment — particularly for firms with high export volumes.
Embrace a Flexible Strategy: A combination of tactics — from diversifying export markets and rebalancing supply chains, to strategic investment in the U.S. — will help businesses manage risk while capitalizing on potential new opportunities.
Conclusion
Trump’s aggressive tariff policy is redrawing the map of global trade. For exporters and multinational firms, the road ahead is filled with complexity — but also opportunity. With careful planning and smart execution, foreign businesses can turn this period of uncertainty into one of strategic transformation and long-term growth.
At HMT we are part of the International Corporate Finance Group and our colleagues in the US are well placed to help identify strategic acquisitions locally that may help soften the impact of Trumps tariffs if you can relocate certain aspects of your business to the US domestic market. If you’d like to have a discussion on how we might be able to support you do please get in touch.
Acquirers often express dismay at the expectation that they will put pen to paper on an indicative offer for a business at a point when they have received relatively little financial information and have had no opportunity validate any of it. But to briefly look at this from the would-be vendor’s perspective, why would they share huge amounts of detail with a third party unless they know that at the end of that sharing is a deal they want to do?
The best way to think about this part of an acquisition process is that it is a sort of courtship dance. The vendor has given you the information that they believe you should need to form a view on appetite (ie are you interested in buying their business) and valuation (ie how much do you think you are prepared to pay for it). They have shown you theirs…
At this point in the process, you have no option but to assume that what you have been shown is a fair representation of reality and put to one side the natural scepticism you might feel about the data provided or the hunger you feel to dig into it further. An indicative offer is just that, indicative. It is not legally binding, and it can be caveated or hedged in any way you feel appropriate. It would almost always be caveated by reference to “confirmatory due diligence” but if you have specific concerns or doubts you can indicate them in making an indicative offer. But if you want the right to delve further into the business you will need to earn the right to do so by making an indicative offer that is acceptable to the vendor. In other words, you need to show them yours….
None of this is to say that the process of formulating the offer should be taken lightly. If an offer is to be taken seriously by the vendor, then it needs to clearly state the assumptions that have been made in arriving at the offer and any specific areas of due diligence that you would want to focus on in taking things forward. It equally needs to respect the information that has been provided and to reflect any doubts you have about it only by reference to the way that the offer might/would vary if things are not as indicated. It would be provocative to simply ignore the information provided in formulating an offer.
It is often sensible to frame an indicative offer by reference to a specific figure or figures in the information provided so that if, in due diligence, that figure is proved to be optimistic, it is self-evident that the overall price will change.
Once an indicative offer has been made, negotiated and accepted, then as acquirer it would be reasonable to expect a period of exclusivity, during which the vendor cannot legally speak to other potential suitors. At this stage you will get the opportunity to fully dig into the information and establish whether the assumptions underpinning your offer are reasonable.
As advisers to vendors, we are always cognisant of the need to be honest in communicating information to potential acquirers. If an indicative offer is based on unreliable or optimistic financial information it will not be worth the paper it is written on. It is therefore a shared endeavour to get to the “right” answer.
Acquirers often express dismay at the expectation that they will put pen to paper on an indicative offer for a business at a point when they have received relatively little financial information and have had no opportunity validate any of it. But to briefly look at this from the would-be vendor’s perspective, why would they share huge amounts of detail with a third party unless they know that at the end of that sharing is a deal they want to do?
The best way to think about this part of an acquisition process is that it is a sort of courtship dance. The vendor has given you the information that they believe you should need to form a view on appetite (ie are you interested in buying their business) and valuation (ie how much do you think you are prepared to pay for it). They have shown you theirs…
At this point in the process, you have no option but to assume that what you have been shown is a fair representation of reality and put to one side the natural scepticism you might feel about the data provided or the hunger you feel to dig into it further. An indicative offer is just that, indicative. It is not legally binding, and it can be caveated or hedged in any way you feel appropriate. It would almost always be caveated by reference to “confirmatory due diligence” but if you have specific concerns or doubts you can indicate them in making an indicative offer. But if you want the right to delve further into the business you will need to earn the right to do so by making an indicative offer that is acceptable to the vendor. In other words, you need to show them yours….
None of this is to say that the process of formulating the offer should be taken lightly. If an offer is to be taken seriously by the vendor, then it needs to clearly state the assumptions that have been made in arriving at the offer and any specific areas of due diligence that you would want to focus on in taking things forward. It equally needs to respect the information that has been provided and to reflect any doubts you have about it only by reference to the way that the offer might/would vary if things are not as indicated. It would be provocative to simply ignore the information provided in formulating an offer.
It is often sensible to frame an indicative offer by reference to a specific figure or figures in the information provided so that if, in due diligence, that figure is proved to be optimistic, it is self-evident that the overall price will change.
Once an indicative offer has been made, negotiated and accepted, then as acquirer it would be reasonable to expect a period of exclusivity, during which the vendor cannot legally speak to other potential suitors. At this stage you will get the opportunity to fully dig into the information and establish whether the assumptions underpinning your offer are reasonable.
As advisers to vendors, we are always cognisant of the need to be honest in communicating information to potential acquirers. If an indicative offer is based on unreliable or optimistic financial information it will not be worth the paper it is written on. It is therefore a shared endeavour to get to the “right” answer.
