Increased economic optimism, a surge in private equity (PE) activity and rising numbers of owners looking to exit could drive an increase in activity in the UK mergers and acquisitions market during 2026, according to a leading annual global report.
These are just some of the predictions within the 2026 MHA Global Transaction Report which has been published by national accountancy and advisory firm MHA, which has offices in Preston and Lancaster.
MHA is the UK member firm of Baker Tilly International, the world’s eighth largest global network of independent accountancy and business advisory firms.
The report gathers the views of senior corporate finance experts from Baker Tilly International’s global M&A network – based in different parts of the world – about transaction activity, trends and forecasts for the year ahead from both a regional and cross-border perspective.
Andrew Feeke, head of corporate finance at MHA, led this year’s report and gave his expectations for the UK market.
He said: "We expect deal volumes to continue to pick up, relative to a more cautious early 2025. While drivers of value remain high growth sectors, there is a theme of a much broader positive outlook for mergers and acquisitions (M&A) across multiple sectors.
“With PE looking to invest in mid-market transactions as a key driver of returns and with an abundance of 'dry powder' to deploy, the fundamentals of an active M&A market appear to be there."
The outlook reflects the views of Baker Tilly International’s experts globally.
71.4 per cent of those surveyed in the report expected domestic M&A activity to increase over the next 12 months, with global experts echoing Andy’s comments about unallocated private equity capital and citing economic recovery as contributing to optimism.
The report also analysed global valuations and funding in the M&A market, including in the UK. 57.1 per cent of the global experts surveyed claimed that valuation trends had increased over the past 12 months.
According to the report, these increases are being driven by better economic conditions such as rising stock market performance, stabilisation of inflation and greater post-pandemic stability.
Andy added: "My sense is that valuations have been relatively stable and perhaps moderately increasing for high quality targets that remain in-demand by multiple buyer groups.
“The quality of the underlying business has never been more important in driving value both at the outset and through a transaction process."
This global rebound is expected to be driven by renewed activity in the private equity market and a wave of owners looking to exit, which was cited by Baker Tilly International experts as the most prominent trend expected to dominate the market in 2026 and 2027.
This was followed by the return of strategic buyers and an AI-driven M&A surge.
Speaking generally about the M&A market’s outlook over the next 12 months, Andy said: "While we can still expect a degree of geopolitical unrest and uncertainty, hopefully this won’t be at the level of the last 12 months.
"Assuming a longer term more stable macro-economic environment, this should encourage deal activity."
The 2026 MHA Global Transaction Report is available on the MHA website.
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