There have been positive signs for UK M&A so far this year, but what does the future hold? Marc Mullen gets the views of three Corporate Finance Faculty board members
James Wild
Partner and head of M&A at RSM
Business services, particularly the legal sector, has been very active for M&A in the first nine months of 2025. Healthcare and tech have remained busy too, while industrials and manufacturing businesses are seeing more M&A activity. Infrastructure services – water, power and renewables – has been busy too.
Activity is not just domestic – we are seeing quite a lot of overseas money flowing in from the US and Europe. When it comes to infrastructure deals, that includes big US, European and international private equity houses.
We have seen businesses looking at what their growth strategy is going forward. Is it buy and build? Is it in the UK? Is it looking into adjacent markets, jurisdictions or products, or services in the UK? More recently we are seeing people looking at internationalisation as the opportunity to grow, whether into Europe or the US.
At the moment, most inbound interest comes from the US, with some from Europe or Australia – and not so much from China or the Middle East. As a country we are quite open culturally and transparent when it comes to external investment. European businesses want to enter the UK to buy a platform they can grow and build. Post-Brexit there was perhaps reluctance to invest, but in recent times we’ve seen German, Dutch, French and Scandinavian buyers looking to acquire in the UK.
Meera Shah
Head of M&A at Buzzacott
With our focus on the lower-mid market, we’ve observed a notable shift over the past six months, with a growing proportion of transactions occurring at the smaller end of the spectrum. This trend is partly driven by acquirers seeking to accelerate capability-building through strategic acquisitions rather than slower organic growth.
At the same time, given lower overall deal volumes, valuations for high-performing, prize assets have been climbing. Businesses that continue to grow robustly in the face of economic headwinds are commanding premium multiples.
This has been especially evident in fragmented sectors. Valuation multiples are bifurcated, with premium assets gaining higher multiples, whereas businesses that have been struggling with pipeline conversion or long deal processes, while eagerly seeking an exit, may be accepting sub-optimal multiples.
We have continued to see strong interest from the US, despite the ever-changing political and economic climates in both countries, and this year we have seen an increased interest from Japan – such as the sale of Cadcorp to Tokyo-listed NEC earlier this summer, on which we advised.
The number of large corporates – particularly consulting and professional service groups looking to acquire capabilities through acquisition, to cross-sell into their existing client base or to bring services in-house – is also rising. This has resulted in trade making approaches to smaller UK businesses slightly earlier than when they may have otherwise looked to exit. This follows a prior 12- to 18-month period where there were many corporate carve-outs.
Nicola Longfield
UK head of advisory
Activity does vary by sector. There are a number of sectors where activity has been strong in the UK and where we expect higher activity levels to continue. Business services, including professional services, has been pretty busy globally, across Europe, and especially in the UK – and we expect that to continue as well. There’s a lot of roll ups in smaller accounting and legal services firms.
Other sectors that have been very active are industrials, tech and energy, with several mega deals taking place and driving up average deal values.
The valuation expectation gap still plays a role in whether an asset will be brought to market. With strong assets, there’s no expectation gap, and we have seen deals complete very quickly. We’ve had an uptick in continuation vehicles activity over last year and it will be interesting to see how the capital markets start to play out over the next year. If the IPO market becomes a real option, private equity exits could form a big part of the M&A horizon over the next year or so.
There’s also a lot of business owners considering whether the evolving political and tax landscape means it’s time to consider selling their business. And corporates are looking at their portfolios for carve-outs. Many corporates are reviewing their portfolios and deciding on what is non-core and optimal to carve out. These assets will be interesting both to strategic acquirers and as standalone private equity investments, depending on scale. I think this will be a key feature of the M&A market ahead.
