Winter M&A update 2026          

Adrian Alexander explores the latest developments in the M&A market     

How the dealmaking landscape could evolve in 2026        

The last few months have brought a welcome period of policy certainty to the M&A market in the UK – and that stability is translating into growing confidence.

Part of this is because firms now have a firmer near-term understanding of tax policy. While the pre-planned increase to Capital Gains Tax rates on disposals qualify for Business Asset Disposal Relief – rising from 14% to 18% in April – is accelerating activity at the lower end of the market, the broader M&A landscape is benefiting from the understanding that there won’t be any significant fiscal changes in the upcoming Spring Statement.

Momentum is also being supported by stronger engagement from buyers, both from overseas and, increasingly, closer to home.

While domestic trade buyers were relatively cautious through much of 2025, international acquirers stepped in to fill the gap. We saw strong interest from across Europe – Dutch, Swedish, Spanish and Italian buyers, among others, have all featured in recent transactions – as well as continued engagement from European private equity backed UK companies. In fact, 45% of our sell-side mandates in 2025 were sold to international buyers, underlining the strength of cross‑border appetite during the year.

However, improving economic conditions and growing policy certainty means that we’re now also seeing more UK private equity and trade buyers return to the table, with domestic corporates re-engaging with opportunities they may have passed on 12 months ago.  

The overall effect is more opportunity for high-quality businesses with strong fundamentals.

Funding appetite

From a sector perspective, in addition to the well-publicised boom in Tech driven by AI, business services and professional services remain the current mainstays of deal activity, continuing to attract interest from a range of buyer types due to offering an attractive combination of recurring revenues and consolidation potential that appeals to acquirers.

However, we’re also seeing increased attention around defence-related businesses. This has been supported by a renewed government-led focus on the sector, which has made investors that might have been historically hesitant to engage with the sector more comfortable with exploring investment opportunities across the extensive defence supply chain.

That said, transactions in this space can bring added complexity. Deals involving defence assets – or those with potential dual-use applications – will require clearance under the National Security and Investment Act before they can proceed. This doesn’t have to be a barrier, but it’s something buyers and sellers should factor into their planning and timetables from the outset.

At the other end of the spectrum, we have found, in some cases, healthcare deals being impacted by continuing uncertainty around NHS policy and funding.

Navigating continued uncertainty

Although there is a growing willingness amongst businesses to transact, there’s no denying that geopolitical uncertainty is continuing to prompt caution in some quarters. The ongoing uncertainty around US trade policy and tariffs is causing some investors to tread carefully while they assess the implications for businesses with significant North American exposure.

That said, the overall outlook of the businesses we’re speaking to is cautiously positive. With relative stability, active investor markets and continued international interest, conditions are improving for well-prepared firms looking to transact.

Amid this environment, thorough preparation remains essential for business owners considering a transaction. Buyers continue to favour businesses with robust financials and clear growth strategies, while flexible deal structures, including earnouts and deferred consideration, remain common as both parties seek to manage risk.

For those considering their options – whether selling, seeking investment, or pursuing acquisitions – taking time to understand the full range of possibilities is more valuable than ever. The right advice can make a material difference to outcomes, helping business owners navigate complexity and achieve their objectives.

From a sector perspective, in addition to the well-publicised boom in Tech driven by AI, business services and professional services remain the current mainstays of deal activity, continuing to attract interest from a range of buyer types due to offering an attractive combination of recurring revenues and consolidation potential that appeals to acquirers.

However, we’re also seeing increased attention around defence-related businesses. This has been supported by a renewed government-led focus on the sector, which has made investors that might have been historically hesitant to engage with the sector more comfortable with exploring investment opportunities across the extensive defence supply chain.

That said, transactions in this space can bring added complexity. Deals involving defence assets – or those with potential dual-use applications – will require clearance under the National Security and Investment Act before they can proceed. This doesn’t have to be a barrier, but it’s something buyers and sellers should factor into their planning and timetables from the outset.

At the other end of the spectrum, we have found, in some cases, healthcare deals being impacted by continuing uncertainty around NHS policy and funding.

Navigating continued uncertainty

Although there is a growing willingness amongst businesses to transact, there’s no denying that geopolitical uncertainty is continuing to prompt caution in some quarters. The ongoing uncertainty around US trade policy and tariffs is causing some investors to tread carefully while they assess the implications for businesses with significant North American exposure.

That said, the overall outlook of the businesses we’re speaking to is cautiously positive. With relative stability, active investor markets and continued international interest, conditions are improving for well-prepared firms looking to transact.

Amid this environment, thorough preparation remains essential for business owners considering a transaction. Buyers continue to favour businesses with robust financials and clear growth strategies, while flexible deal structures, including earnouts and deferred consideration, remain common as both parties seek to manage risk.

For those considering their options – whether selling, seeking investment, or pursuing acquisitions – taking time to understand the full range of possibilities is more valuable than ever. The right advice can make a material difference to outcomes, helping business owners navigate complexity and achieve their objectives.