Interest in UK companies from foreign buyers soared during 2025, with the increase directly responsible for the year seeing a post-pandemic high in dealmaking. According to new data from the London Stock Exchange Group, agreed deals for British companies by overseas bidders reached $142 billion (approx. £105 billion) last year, a 74 per cent increase compared to 2024.
The rise in inbound acquisitions proved a stark contrast to domestic M&A activity within the UK, with domestic dealmaking falling by 54 per cent to around $44 billion (approx. £32.7 billion) last year, the lowest total for nine years.
UK dealmakers have faced a raft of economic challenges, including uncertainty in the run up to the Autumn Budget in November, persistent turmoil relating to US trade tariffs and a number of other geopolitical headwinds.
The increase in foreign takeovers significantly outpaced a 20 per cent rise in wider UK M&A during the year. Overall, UK M&A increased to $367 billion (approx. £273.1 billion) during 2025, the highest level since the dealmaking boom that occurred during the COVID-19 era.
The growing interest in UK companies among foreign buyers, particularly from the US but also Europe, has largely been attributed to cheap valuations. With UK companies remaining undervalued compared to many overseas rivals, strategic interest from international buyers is expected to continue during 2026.
The wider increase in UK M&A value was primarily driven by a rising number of larger deals, with overall deal volume actually falling by 16 per cent during 2025. This has occurred against a broader backdrop of rising international dealmaking, especially in the US where large transactions have been increasing amid rapid deregulation.
In terms of the buyers targeting UK businesses, more than half of inbound transactions involved a US buyer. Private capital investors were among the most active bidders, responsible for a number of major deals including Apollo-backed Athora’s £5.7 billion takeover of Pension Insurance Corporation.
Another key trend has been private equity acquisitions of listed businesses, such as KKR’s recent £4.7 billion takeover of London-listed high tech instruments provider Spectris PLC, which followed a highly competitive bidding process.
Looking ahead to 2026, there is a broad expectation that private equity activity will increase as firms come under growing pressure from investors to deploy their huge reserves of unspent capital, which could provide a significant boost to M&A activity across a number of sectors.
With dealmaking having been so constricted ahead of the Autumn Budget, there are also a number of deals that could be poised to go through over the coming months, with Sky in talks to acquire ITV’s television operations and BP in discussions to divest its lubricants business to Stonepeak.
While these could generate significant M&A tailwinds, it appears that foreign takeovers of UK companies could remain the major trend in dealmaking during 2026.
Read more on UK M&A trends:
Autumn Budget 2025: The key takeaways for M&A
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