Corporate deal round-up H1 2025
The first half of 2025 has been defined by action and controversy worldwide. We have seen the devastating impacts of conflict in the Middle East, a geopolitical environment shaken by Trump-era tariffs, and growing uncertainty at home as the Labour Government battles various headwinds to drive forward its agenda of change. For businesses however, this backdrop has not resulted in the level of despondency one might have expected. Though M&A activity has slowed in recent years , the message from us is that there is still plenty of room for optimism. As we settle into our uncharacteristically hot summer, we reflect below on events in the first six months of 2025, their impact on the mid-market M&A scene and our predictions for the remainder of 2025.
For a spotlight on some of the more notable deals carried out by our top-ranked Corporate group in the opening six months of 2025, please click here.
What have we seen in the first half of 2025?
Despite a year-on-year drop of 9% in deal volume across the global M&A market – not unexpected given the continued uncertainty caused by global geopolitics – activity in the mid-market has remained broadly resilient, driven by:
A resurgence in mid-market private equity investment
Geopolitical instability has led to a continued build-up of dry powder in the war chests of global private equity, but those war chests are creaking open. Alexis Karim was quoted in a recent Real Deals piece noting the growing opportunity across Europe for private equity investment, particularly in the pursuit of strategic bolt-on investments. We have seen this ourselves, having supported our long-standing client Puma Growth Partners on three strategic investments in the opening six months of 2025, including NRG Gym, Semeris, and LOVE CORN. Whilst investments do appear to be resurging from a period of dormancy, the private equity story as a whole is more nuanced. Exits remain sluggish – assets are being held for considerably longer than the historical norm, with private equity firms under increasing pressure to retain and grow the value of those portfolio assets.
Continued interest in UK business by foreign investors
Global investment in the mid-market UK landscape has remained resilient, driven by our sectoral diversity and a relatively stable economic environment. A period of subdued activity has perhaps led to a light push towards a narrowing of valuation gaps as assets are held for longer, making exit events more likely and increasingly attractive to investors. With the impact of US tariffs and international policy at large - though activity as a whole may have dropped - we have seen considerable US investment in the UK in our client base – for example on Portas’s sale to CAA Sports; and Stow Healthcare’s sale to US-based CGEN Care Group. The US market remains a crucial driver for M&A activity in the UK, and a key focus for our firm.
Buoyancy in a selected number of sectors
Technology and digital transformation remain at the forefront of investment, on multiple fronts; technology assets continue to be seen as strong ones for buy and build strategies, but we also continue to see businesses across the piece looking to technology and digital transformation assets as strategic investments for their own business growth. For example, we supported Acora on their strategic acquisition of Elastacloud. Healthcare and life sciences too remain significant sectors of interest , with demographic trends and the aftermath of the pandemic continuing to drive demand for innovation and consolidation in these sectors. In Q1 alone, Heligan Group noted that 59 UK-based M&A transactions completed involving healthcare assets – keeping pace with 2024, a strong story given the broader M&A environment.
What’s next?
Cautious optimism remains the theme in our predictions for the remainder of 2025.
Continued deployment of private equity
The signs are there of an investment resurgence, particularly within the mid-market space, and we anticipate this trend to continue throughout the next six months. We would hope though that the exit environment follows its investment sibling into a period of activity. If the stars align, private equity exits could well witness an explosive period; it will be crucial for private equity firms to ensure their assets are best prepared for that exit event, ensuring they receive the best value. Ensuring, or improving, good corporate governance practice amongst portfolio companies is a key way in which firms may wish to do this, an area our team is well versed in being able to support.
Continued foreign investment
Bar any unforeseen crises (something that in recent times is no sure thing) we anticipate a continued period of reasonable stability politically and economically within the UK. While US inbound activity may at large remain muted due to currency pressure, we continue to expect strong interest in UK assets from US investors, particularly in sport. We also anticipate capital from the Middle East, Asia Pacific, and Europe to rise, with investors targeting resilient platforms in tech, financial services, and professional services.
Geopolitical instability – the new normal?
In recent years the M&A market, and corporate boardrooms particularly, has faced a series of “once in a lifetime” shocks – Covid-19, a global hike in interest rates, and now a series of US tariffs. As tensions continue worldwide, perhaps geopolitical instability is just the new normal. Business leaders are having to, and will continue to have to, progress their business strategies (including M&A) in an uncertain global environment. Having a calm legal advisor by your side that understands the commercial impact of legal and business decisions, dare we say, will help you navigate this climate and structure your deals appropriately.
AI investment will become an imperative for businesses seeking to compete
AI is no longer a buzzword, but a boardroom issue; it is a growing critical function for businesses seeking to drive efficiencies and compete in a growing competitive landscape. We see this ourselves, and have invested heavily in driving AI and other tech functionality to deliver for our clients. M&A as a strategic move to develop this capability will continue to be key. Businesses will need to ensure that appropriate due diligence and cultural and strategic thought is put behind these deals.
An increased desire to sell by those impacted by Business Property Relief (BPR) changes
Upcoming changes to BPR are due to come into effect from April 2026. Family and founder-owned businesses face a rare opportunity to unlock full value from the legacy they’ve built; it is one we anticipate many taking. By acting now, owners can not only maximise tax efficiency, but realise the rewards of their hard work on their own terms - whether through succession planning, trust structuring, or a carefully managed transaction.
Continued interest in the development of PISCES
PISCES remains an LSE project we watch with keen interest. The market is likely to resonate strongly with much of our own client base in its potential to allow closely-run private and family-owned businesses to explore routes to achieve liquidity flexibility, and without relinquishing too great a control of the business, though regulatory and practical uncertainties remain. We look forward to its continued development and to advising clients on its potential viability for them.
Whilst it is near-impossible to make accurate predictions in a geopolitical environment characterised by its unpredictability, we remain optimistic for the competitiveness of the UK mid-market. Private capital, and private equity in particularly, seem to be loosening their investment belts, and we hope this may then extend to strategic liquidity events, with the UK remaining a market of relative stability and diversity . While challenges remain, the UK mid-market M&A sector is far from stagnant. It is evolving, adapting, and positioning itself for future growth. For businesses, investors, and advisers alike, this is a time to remain focused, agile, and optimistic about the opportunities that lie ahead.
