The Strategic Resurgence: The 2025 M&A Landscape and Implications for 2026

The global M&A market in 2025 has moved beyond recovery and entered a phase of structural realignment. Following two years marked by valuation adjustments, regulatory uncertainty, and constrained financing, dealmaking activity has reoriented toward more deliberate, strategy-led transactions. Rather than prioritizing volume, corporates are increasingly using M&A to reposition portfolios, access capabilities, and reinforce long-term competitive advantage. 

This evolution represents a departure from the volatility of the post-pandemic cycle. In 2025, M&A activity has become more selective and intentional, with greater emphasis on scale, technology, and structural fit.  

This article synthesizes insights from recent global market analyses and dealmaking data, including reporting from Reuters, Bain & Company, and J.P. Morgan, to assess market performance, strategic drivers, sector and geographic dynamics, evolving financing structures, and the outlook for 2026. 

Market Performance: Value Recovered Sharply Despite Lower Deal Volume 

According to Reuters, by historical standards, 2025 represents a strong year for M&A value. Global deal value is projected to reach $4.8 trillion, making it the second-highest year on record, following the exceptional peak of 2021. This reflects a 36-41% increase compared with 2024, indicating a meaningful improvement in confidence and execution conditions. 

At the same time, overall deal volume declined by approximately 6%, reinforcing the divergence between value and activity. Rather than broad-based expansion, the market was driven by a concentrated set of large transactions. A record 70 deals exceeded $10billion, with momentum strengthening in the second half of the year, particularly in the Americas, as financing conditions stabilized and regulatory visibility improved. 

Overall, transaction size increasingly served as a signal of strategic intent, with companies favouring fewer, higher-impact deals over incremental acquisitions.

Strategic Drivers: M&A Re-emerged as a Tool for Portfolio Repositioning 

The renewed momentum reflects a broader reassessment of M&A’s role within corporate strategy. According to Bain & Company, more than 85% of M&A executives reported revisiting their acquisition pipelines in 2025, primarily in response to technological change, most notably the rapid adoption of artificial intelligence. 

Several factors underpinned this shift. First, changes in the regulatory environment, particularly in the United States, reduced perceived execution risk for larger transactions, allowing boards to reconsider combinations that had previously faced higher uncertainty. Second, “scope” transactions gained prominence. Approximately 60% of deals above $1 billion focused on acquiring new capabilities, technologies, or market access rather than expanding existing businesses, reflecting the increasing difficulty of building such capabilities organically at pace. 

Finally, deal activity was increasingly driven by infrequent acquirers. Around 60% of megadeals involved companies that transact rarely but pursue large-scale acquisitions to accelerate strategic repositioning. These transactions tended to reflect longer-term portfolio decisions rather than short-term financial optimization. 

Sector Dynamics: Capital Concentrated in Technology, Industry, and Media 

While activity was broad-based, capital allocation was uneven across sectors. According to Bain & Company, technology accounted for the largest share of growth, with deal value increasing 76% to $478 billion. Nearly half of this value involved AI-native businesses or transactions explicitly linked to AI-related synergies, underscoring the view that AI capabilities are becoming a foundational element of competitive advantage. 

Advanced manufacturing also saw substantial activity, with deal value rising 38% to $717 billion. Transactions were primarily driven by supply-chain localization, automation, and industrial digitization, reflecting a focus on resilience and productivity rather than pure capacity expansion. 

In media and content, several large and highly visible transactions highlighted the strategic importance of scale in distribution and intellectual property. High-profile bids, including Netflix’s $82 billion offer and Paramount Skydance’s $108 billion bid for Warner Bros. Discovery, illustrated ongoing consolidation pressures in a capital-intensive and highly competitive sector. 

Geographic Trends: U.S. Leadership with Selective Re-acceleration in Asia 

Geographically, the recovery was uneven. The United States remained the primary contributor to global deal value, accounting for nearly half of total strategic M&A, supported by deep capital markets and continued leadership in technology-driven sectors. 

Japan emerged as a notable growth market, with M&A value doubling year-on-year, elevating it to the third-largest market globally. Corporate governance reforms, increased shareholder engagement, and currency dynamics collectively supported increased deal activity. 

In Greater China, deal volume remained high but was predominantly domestically oriented, reflecting ongoing constraints on cross-border transactions alongside continued internal consolidation. EMEA experienced lower deal volumes but maintained resilient value, supported by selective consolidation and is expected to continue playing a leading role in global IPO activity through 2026. 

Financing Conditions: Private Credit Became a Core Component of Deal Funding 

Although overall liquidity improved in 2025, financing structures continued to evolve. According to JP Morgan, private credit emerged as a central element of the M&A capital stack, with global assets under management projected to exceed $2.3 trillion. Direct lending provided flexibility and execution certainty for large transactions, including the $23.7 billion acquisition of Walgreens Boots Alliance. 

At the corporate level, capital allocation decisions remained disciplined. Spending on M&A reached a 10-year low as companies prioritized internal investment in areas such as AI infrastructure, automation, data centres, and energy assets. This trade-off reinforced selectivity, contributing to lower deal volumes but higher strategic coherence among completed transactions. 

Outlook: Conditions Support a Sustained M&A Cycle into 2026 

Looking ahead, indicators suggest the potential for a sustained, multi-year M&A cycle rather than a short-term rebound. Several transactions in the $50–70 billion range are already in advanced stages, making a $100 billion technology transaction within the next cycle plausible. 

Future activity is expected to increasingly reflect sector convergence, particularly across AI, climate technology, and healthcare, where scale, regulatory complexity, and capital intensity favor integrated platforms. In parallel, APAC (excluding Japan) is projected to see close to $200 billion in USD-denominated debt issuance, supported by easing interest rates and continued investment in AI-related infrastructure. 

The current M&A environment reflects a transition from broad-based expansion toward selective structural transformation. For corporates and investors, success in this cycle is likely to depend less on transaction frequency and more on strategic clarity, execution capability, and alignment with long-term value creation objectives. 

References list

Bain & Company. (2025). Global M&A stages great rebound in 2025 with $4.8 trillion deal value to mark second-highest total on record. https://www.bain.com/about/media-center/press-releases/20252/global-ma-stages-great-rebound-in-2025-with-$4.8-trillion-deal-value-to-mark-second-highest-total-on-record 

JPMorgan Chase & Co. (n.d.). Global dealmaking trends driving growth. https://www.jpmorgan.com/insights/banking/global-dealmaking-trends-driving-growth 

Potkin, F., & Thomas, D. (2025, December 18). More mega-deals coming as chase for scale fuels near record-breaking year for M&A. Reuters. https://www.reuters.com/business/finance/more-mega-deals-coming-chase-scale-fuels-near-record-breaking-year-ma-2025-12-18/