The value of foreign acquisitions of UK companies surged to £27.4 billion in the final quarter of 2025, the highest level since the second quarter of 2021, according to figures released by the Office for National Statistics (ONS).
The dramatic increase, representing a nearly £20 billion jump from the previous quarter’s £7.6 billion, signals continued interest from international buyers in what they perceive as undervalued British assets. The ONS attributed the rise to a greater number of deals exceeding £1 billion in value.
Several high-profile transactions underpinned the surge. In October, US food delivery giant DoorDash formally acquired Deliveroo for £2.9 billion. Deliveroo, which listed on the London Stock Exchange in 2021 with a valuation of £7.6 billion, had seen its share price decline by more than 50 percent in the intervening period. DoorDash, in contrast, maintained a valuation of $71 billion following its 2020 initial public offering in the United States.
December saw US private equity firm KKR complete a £4.8 billion takeover of Spectris, a UK-listed company specializing in precision instruments. These deals reflect a broader trend of UK companies becoming takeover targets for their US counterparts.
Patrick Sarch, head of UK public M&A at White & Case, explained that international bidders are drawn to the UK by “relative valuations and many undervalued businesses.” A recent McKinsey report supports this assessment, indicating that the UK’s average EV/EBITDA multiple – a key metric comparing a company’s valuation to its earnings – stands at 7.7, significantly lower than the 13.8 recorded in the US.
However, the McKinsey report also cautioned that the disparity is partly due to the outperformance of large US technology firms, which have not been matched by their UK equivalents. The report noted that the “relative underperformance of the largest UK companies, as well as the absence of significant outliers, has tended to have a detrimental effect on valuations.”
While inward M&A activity flourished, domestic M&A – deals involving UK companies acquiring other UK firms – experienced a decline, falling to £1.8 billion from £7.1 billion in the previous quarter. Outward M&A, where UK companies acquire foreign businesses, also decreased, dropping from £3.4 billion to £1.7 billion.
Looking ahead to 2026, Helen Brocklebank, head of M&A at RSM, suggested that geopolitical tensions and their impact on inflation could deter major deals. “In this environment, industries with strong recurring revenues such as business and professional services, healthcare, technology and industrials will continue to be seen as the most attractive acquisition targets,” she said.
Consultancy UK reported in late 2025 that PwC, Bain & Company, EY, Grant Thornton, and KPMG were among the top firms in the UK for Mergers & Acquisitions services, though their profiles on the Consultancy UK website were listed as inactive as of March 4, 2026.
