European M&A report: Industry trends and growth drivers

As we move through 2025, the European mid-market mergers and acquisitions landscape continues to reflect a market characterised by resilience and adaptability against an evolving backdrop of uncertainties. Despite a range of external pressures, deal activity has remained solid, with volumes increasing in the year ending June 2025.

Across Europe, RSM has advised on 731 completed deals, highlighting the market's sustained momentum and our teams' strong engagement with clients across the continent. Engineering and manufacturing has been particularly notable, with 147 transactions completed. This was followed closely by technology, media, and telecommunications (TMT) with 139 deals, and business services with 135. This activity underscores continued investor interest in high-quality, resilient businesses with strong technological foundations and recurring revenues.

While the general environment remains complex, the gradual easing of inflation and a more stable economic outlook have made pricing and risk assessment clearer, allowing deals to move forward. The availability of investment capital, especially from private equity, has played a key role in keeping M&A activity strong.

This 2025 report provides in-depth analysis from our experts across Europe. It delves into the key trends shaping the M&A market, including insights into key industry sectors, the impacts of technology, and the rise of data analytics in building detailed value insights. By combining deep, industry-specific insights with our extensive cross-border capabilities, we help middle-market organisations navigate complexity and take charge of change, offering the understanding you need to move forward with confidence.

Outlook for 2026

The European M&A landscape in 2026 is expected to demonstrate continued resilience, supported by strategic focus and targeted investment across key industries. Private equity is anticipated to remain a significant driver of activity, with substantial capital reserves being deployed into high-growth niches. The buy-and-build strategy is likely to retain its prominence, enabling investors to achieve scale and diversification across geographies and industry verticals. High-value subindustries, including energy transition, AI-driven technology, and healthcare services, are expected to continue attracting considerable interest, reflecting a broader emphasis on innovation and sustainability. Stabilising interest rates and easing inflation are projected to create a more predictable economic environment, fostering confidence among dealmakers.

Despite these positive indicators, challenges such as valuation gaps, regulatory complexities, and geopolitical uncertainties are expected to influence the pace of activity. Cross-border transactions are likely to gain momentum, particularly in less regulated sectors, as investors seek synergies and new market opportunities. The integration of transformative technologies, including AI and automation, is expected to play a pivotal role in shaping M&A activity, particularly within technology, media, and telecommunications (TMT) and business services. Overall, the European M&A market in 2026 is forecast to balance cautious optimism with strategic adaptability, as businesses and investors navigate an evolving and complex landscape.