M&A Outlook 2026: Recovery Momentum and Strategic Imperatives
bIAnk AI Research · December 2025 · 9 min
Harvard Law Forum analysis shows M&A recovering in 2025 with momentum building for 2026. Deal values rising even as volume remains constrained.
The Harvard Law School Forum on Corporate Governance's December 2025 review confirms that M&A activity has entered recovery mode after a challenging 2023-2024 period. While deal counts remain below historical averages, transaction values have increased substantially as larger, more strategic deals return to the market.
Deloitte's 2026 M&A Trends Survey describes "a tale of two markets" – robust activity in strategic deals and technology M&A contrasting with continued caution in leveraged transactions. Corporate buyers are prioritizing transformational acquisitions over financial engineering.
BCG's analysis of the "brave new world of dealmaking" emphasizes that AI and digital transformation remain the primary strategic drivers. Companies are acquiring to build capabilities rather than simply to achieve scale, leading to higher valuations for technology-enabled targets.
According to Chambers & Partners, average deal values have soared in 2025, particularly in the Spanish market where aggregate transaction value decreased only 10.7% despite a 16.8% decline in deal count. This reflects larger, higher-quality transactions rather than volume-driven activity.
Cross-border M&A is recovering, supported by improved financing conditions and strategic necessity. European targets remain attractive to U.S. acquirers given currency dynamics, while Asian buyers continue selective expansion in developed markets.
Looking to 2026, the consensus view points to continued recovery. Key drivers include: accumulated dry powder at PE firms, corporate need for digital transformation, and improved visibility on interest rate trajectory. However, regulatory scrutiny, particularly in technology and healthcare, remains a significant deal consideration.
Key takeaways
- M&A deal values rising despite volume remaining below historical averages
- Strategic and technology M&A leading recovery; leveraged deals more cautious
- Average deal values up significantly as focus shifts to quality over quantity
- 2026 outlook positive driven by PE dry powder and corporate transformation needs