Confidence among UK dealmakers is low amid global volatility and growing disaffection with the UK’s government. According to a new survey, just 13 per cent of British dealmakers have a positive view of the economic outlook over the next 18-24 months, down from 48 per cent last year.
The UK, like much of the rest of the world, has seen sluggish dealmaking levels so far in 2025, as mounting geopolitical tensions and persistent economic certainty have impacted M&A appetite and hampered dealmaking.
While there is some optimism that this situation will improve as economic conditions stabilise, CIL’s latest Investment 360 Index demonstrated a significant degree of pessimism among UK dealmakers.
The survey polled more than 100 UK market stakeholders, including management teams, corporate finance providers, private equity investors and business advisors. CIL has been running the report for nine years, with 2025’s findings reflecting the lowest level of optimism over the past decade.
This pessimism has seemingly primarily been driven by dissatisfaction with the UK’s Labour government, which came to power in a landslide last summer amid considerable optimism. In the 2024 report, just 16 per cent of respondents said they were negative about the UK’s short-term prospects, but this has soared to 57 per cent this year.
72 per cent of respondents, meanwhile, said that they did not feel that Prime Minister Sir Keir Starmer and his cabinet have been doing a good job. This is again the lowest rate since the survey began, despite the report having covered years defined by chaos relating to Brexit and public health lapses during the COVID-19 pandemic, during which several governments collapsed.
While short-term sentiment is largely negative, the long-term outlook was more positive, but still at a record low, with 40 per cent positive about long-term prospects, compared to 24 per cent who were negative.
Another more positive finding was that 53 per cent expect M&A activity to increase over the coming months, while 40 per cent expect dealmaking to remain stable. However, this was down from 76 per cent and 19 per cent respectively in 2024. 23 per cent described the current quality of assets as good, the same as last year, while 68 per cent described the quality as average, up from 60 per cent.
Discussing the report’s findings, CIL Senior Partner Alex Marshall said: “This year’s findings reveal a marked deterioration in confidence: pessimism about the long-term economic outlook has reached record levels, dissatisfaction with government policy is at an all-time high, and deal activity remains sluggish.”
“While some positives remain – pent-up demand, stable credit markets, and the steadying effect of lower inflation – the prevailing view is one of disappointment. Stability, once again, has failed to materialise.”
Read more about emerging UK M&A trends:
High value deals the priority as UK activity slows in H1 2025
How economic conditions impact business sales
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