After a period of caution, stalled deals and rising borrowing costs, the M&A market is trending up, with momentum. Mergers and acquisitions trends in 2026 point to a structural shift, rather than a cyclical bounce. Full-year 2025 global M&A activity surged, with total deal value rising nearly 40% over 2024 (Source: LSEG) to a record ~$4.9 trillion (Source: Dealogic), fueled by a sharp rebound in megadeals. In the middle market, tariff uncertainty and boardroom hesitation kept deals from clearing.
That hesitation is giving way. The FTC and DOJ are showing signs of easing the deal pipeline, most notably through the reinstatement of early termination for HSR approvals, which is shortening closing timelines for clean transactions. Interest rates have eased. CEO confidence is up. Dry powder remains high; the capital is there. Mergers and acquisitions trends in 2026 point to improving conditions, especially in certain industries where consolidation is concentrated.
Mergers and Acquisitions Market Shifts: Industries Primed for Consolidation
The consolidation building in 2026 is concentrating on where scale advantages are clearest and structural pressures are most acute.
Tech and AI
Technology and AI infrastructure lead the list. The rapid build-out of AI infrastructure, especially data centers, is fueling M&A across software, semiconductors, data-center hardware, networking and real estate. Companies are striving to close capability gaps and participate in the explosive demand for AI. Technology-led megadeal activity in 2025, with 26 announced deals, the highest of any sector.
Finance
Financial services are consolidating across sectors. From banking and payments to asset management and insurance, these services are poised for continued consolidation and portfolio repositioning. In 2026, fragmentation in financial services is giving way, with geographic reach and service line depth increasing.
Healthcare Services
Healthcare consistently sees activity in the mergers and acquisitions market. In 2026, demographic trends, cost pressures and the shift toward integrated care models are driving consolidation among providers, specialty practices and healthcare technology platforms. The combination of structural fragmentation and non-negotiable demand is extremely enticing for M&A.
Industrial Services
Industrial companies are pursuing mergers and acquisitions in the supply chain to secure vertical integration. Advancing end-to-end integration strategies, from component manufacturing through lifecycle support, increases operational resilience. This creates an attractive environment for M&A.
Mergers and Acquisitions Trends: What Buyers Are Scrutinizing
The record-breaking deal environment of 2021, when growth narratives could compensate for thin margins or untested leadership, is gone. Buyers are more selective, exercising greater precision with their capital.
In the mid-market, the evaluation of mergers and acquisitions has fundamentally shifted. The primary shift in 2026 centers on the method of deal evaluation rather than participants. Increased scrutiny is now placed on recurring revenue and long-term profitability. Predictability has replaced potential as the core underwriting requirement. Recurring revenue is no longer viewed as a premium feature but as a baseline expectation; project-based or one-time revenue is frequently discounted unless there is a clear history of conversion into continued revenue.
Simultaneously, profitability standards have tightened. Buyers are stress-testing EBITDA quality to ensure margins are durable across various growth scenarios. Management team assessment has also evolved into a critical underwriting factor. A leadership team that cannot scale a strong product is now viewed as a risk that many buyers are unwilling to absorb. The strength of the leadership is now weighted alongside financial performance.
In 2026, thorough diligence processes mean that fundamental business health carries more weight in transaction outcomes. Preparation is now vital. To help buyers grasp underlying performance trends, advisors typically suggest compiling at least 36 months of normalized financial statements. This begins long before formal market entry. Companies failing to provide this groundwork often face valuation discounts or find that buyers walk away entirely.
AI and Technology Capabilities Influencing Valuations
The urgency surrounding AI and technology capabilities drives the deal process conversation as a critical key during valuation. Acquirers are increasingly willing to pay a premium for businesses that can demonstrate technological innovation. From AI implementation roadmaps and AI-leveraged technologies to proprietary data assets that create a competitive edge, there is concern about maintaining innovation or falling behind. This shift is exemplified by high-profile activity, such as Alphabet’s acquisition of Wiz and Meta’s joint venture with Blue Owl, illustrating that capital is following the perceived necessity of AI leadership.
Inversely, companies running on fragmented legacy systems and lacking a clear AI roadmap are being discounted by buyers, who are pricing in the future cost of catching up. The technology gap that might have been overlooked in previous years is now being priced into the deal. Consequently, many private equity investment committees now dedicate significant discussion time to assessing a target’s AI readiness and digital posture.
Premium Valuations Reserved for Best-in-Class Companies
Deal values are projected to stay high as activity clusters around the most significant transactions and the most well-resourced buyers. This trend follows a 2025 market in which industry leaders commanded premium valuations amid a competitive field, while less prepared companies struggled to finalize agreements.
Entering 2026, international buyers maintain a desire for premium assets and demonstrate a readiness to engage in aggressive bidding. This competitive landscape provides a significant advantage to top-tier sellers, though it does little to bolster the broader market.
For owners weighing an exit, the takeaway is clear: the disparity in final deal value between thoroughly prepared companies and those that are not has reached an all-time high. The great consolidation wave is powerful, but highly selective.
Preparing for a transaction? Squire can help. Squire offers mergers and acquisitions advisory services that work alongside you at every stage. From normalizing 36 months of financials to positioning your business for premium valuation, we help companies get deal-ready.