Mid-market bolt-on M&A activity by private equity and venture capital-backed UK platforms fell sharply last year. According to a new report from law firm Stevens & Bolton, add-on acquisitions from the most active buyers fell by 61 per cent in 2025, albeit from a peak in 2024.
Having recorded a five-year high of 114 deals in 2024, the UK’s 45 most active serial buy-and-build acquirers (defined as those that had made 10 or more acquisitions in the past five years), completed just 44 deals last year.
While the surge in 2024 was driven by sustained M&A appetite in fragmented markets such as insurance and business services, 2025’s activity levels were shaped by both macroeconomic conditions and political uncertainty.
As well as the external conditions that affected M&A appetite, Stevens & Bolton also noted that some slowdown was to be expected and is a natural part of the buy-and-build cycle. Following such a busy year in 2024, some acquirers naturally paused or reduced their transaction activity and turned their focus more towards integration.
While the report showed a steep overall drop in mid-market bolt-on activity, buy-and-build plans still continued in a number of resilient sectors. 36 per cent of 2025’s deals took place in the business services sector, while financial services and consulting each accounted for 16 per cent of the total.
However, some sectors that had seen significant activity in previous years saw sharp declines. Insurance deals fell 85 per cent, with dealmaking in the industry continuing to shift away from the high-volume consolidation that has shaped the broker market in recent years towards more selective, specialist MGA and broker deals.
Education, meanwhile, saw a 71 per cent drop in activity and bolt-on deals in the technology sector fell by 80 per cent. According to the report, technology deals fell amid a growing shift in investor attention towards artificial intelligence.
Jonathan Steele, Corporate Partner at Stevens & Bolton, commented: “Trends in technology deal activity might suggest that investor and acquirer attention has been focused on artificial intelligence, so it would not be a huge surprise to see a dip in buy-and-build transactions for existing technology companies. The AI bubble is dominating the market and, inevitably, PE is focused on tactical and strategic long-term investment in future technologies.”
Despite the considerable dip in activity, Steele said this didn’t suggest that private equity and venture capital investors were moving away from buy-and-build models, saying that they remained “a naturally favoured strategy and significant driver of UK M&A activity.”
However, Steele also acknowledged the impact of geopolitical and macroeconomic factors on activity: “M&A activity tends to act as a bellwether for economic confidence, which underpins stability and the alignment of buyer and seller price expectations, and therefore the ability to get more deals done more quickly. As a result, it is no surprise that 2025 saw a slowdown in buy-and-build activity.”
“The impact of Reeves’ first Autumn Budget in October 2024, coupled with the crashing waves of Trump 2.0 and the resulting uncertainty, inevitably had a dampening effect on transactional activity. Conversely, the impending threat of that same Budget and anticipated Trump-led uncertainty had supercharged bolt-ons and M&A generally in Q1 to Q3 of 2024.”
Looking forward, Steele said that greater confidence would likely result in pent-up M&A demand being released, building momentum in new deal volume: “Private equity firms will always seek EBITDA scalability opportunities and consequential multiple arbitrage, and the data shows that there are plenty of sectors with strong and growing buy-and-build potential.”
“If confidence, or opportunism and increased appetite for risk, can pull the market through the environment of global unrest, then 2026 bolt-on activity should at least return to pre-2024 levels and, because of a quieter 2025, could exceed that.”
See also:
Buy & build M&A: Why integration matters more than volume and scale
UK M&A Outlook 2026: Tempered optimism after a slow year
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