UK Public M&A Review 2025
28 January 2026
Welcome to our review of the UK public M&A market for 2025. Do also listen to our podcast in which Tom Mercer, Harry Thimont and Jade Jack describe the trends they are seeing in the market and what to expect in 2026.
A link to download the full review can be found at the bottom of the page.
Overview
A year of transition
2025 followed a year of unprecedented geo-political change. While the markets demonstrated resilience, global tensions and ongoing conflicts in Europe and in the Middle East continued to have an impact, as did Trump’s tariff policies, particularly in the first half of the year. Closer to home, speculation surrounding the UK budget dampened deal activity in the second half of the year.
Discussions around AI monopolised the news, with enthusiasm for AI and AI-related businesses propping up increasingly high valuations. This was most evident in the US, where the combined market caps of the “Magnificent Seven” make up roughly one third of the S&P 500. The debate rumbles on as to whether we are facing an AI “bubble” and, if so, when that might pop. Sceptics claim that AI stocks are over-valued, over-invested and over-leveraged; proponents emphasise the clear differences between current market dynamics and the speculative frenzy of the 2000 dot-com era, claiming that the valuations are supportable. The market appears to still be supportive.
At the other end of the spectrum, it was a strong year for traditional stocks such as banks and natural resources. This benefitted the FTSE 100 which rose more than 20% and was one of the best performing major global indices in 2025.
Going into 2026, it will be interesting to see whether the UK markets can continue their strong run and whether the various growth-focused reforms can activate the equity capital markets. Looking more internationally, all eyes remain on AI.
The UK public M&A market in 2025 and predictions for 2026
The UK public M&A market continues to be vulnerable to significant geo-political disruption, and, as in prior years, macro-economic and political factors had an impact in 2025. A strong run of offers in early summer was followed by a steep decline in the second half of the year. The decline in Q3/Q4 was attributed, in part, to the uncertainty caused by the late November budget.
Whilst overall volume ended slightly up compared with 2024, deal values were down, with fewer £1bn+ firm offers announced and average deal values falling. Nevertheless, large-cap deals, such as the competing offers for Spectris, show that the financing markets are still there for the right assets and we expect to see more of these coming to market in 2026.
Competition for attractive assets was strong and, whilst bidders showed financial discipline, some significant premia were still being offered, even on higher value assets.
Shareholder engagement and activism is increasingly shaping the market in a range of different ways. In one scenario, shareholders are pushing target boards to consider strategic options, including carve-outs and the sale of the whole; in another, long-term investors are opposing deals in favour of retaining exposure to the equity markets.
Over the last few years, we have learned not to assume anything, but the UK market looks attractive going into 2026. We expect international interest, including from the Middle East, to continue, as investors seek to capitalise on the undervaluation of the UK markets and Sovereign Wealth Funds look to deploy significant capital.
Mandates
In the last quarter, Ashurst's UK public M&A mandates include advising:
- Jefferies on the offer for International Personal Finance;
- Cavendish on the consortium offer for Inspecs Group;
- Time Out on its placing and debt for equity swap and associated Rule 9 waiver;
- Deltam on its acquisition of 50.25% of the voting rights in Renishaw.
