EY-Parthenon anticipates increase in M&A activity in 2026

EY-Parthenon, the strategic consulting division of EY, has predicted an upsurge in mergers and acquisitions (M&A) in 2026, following the growth that began in 2024. Both corporate and private equity (PE) sectors are expected to see an increase in deal volume next year. The forecast suggests that the number of corporate M&A deals will surge by 3% in 2026 after an anticipated 10% rise in 2025. Similarly, PE deals are expected to grow by an estimated 5% in 2026 following an 8% increase in 2025.

The third quarter of this year has seen a revival in deal activity, which had a sluggish start due to policy uncertainties. Improved credit conditions, escalating valuations, and rising CEO confidence have driven momentum leading up to 2026. EY-Parthenon’s Mitch Berlin stated that successful CEOs are no longer hesitating due to global instability but are now acquiring capabilities, particularly AI and next-gen technologies, to transform their businesses for permanence and drive portfolio modifications.

Corporate M&A deals, which are set to grow by 10% this year, have been propelled by strong corporate financial positions and favorable financial conditions. On the other hand, PE deals, which saw an 8% growth in 2025, have benefited from a reduction in valuation discrepancies, which were substantial obstacles in previous dealmaking years.

The economic landscape remains conducive to M&A activity, according to EY-Parthenon. The firm predicts a 2% real GDP growth in the US for 2025, declining to 1.7% in 2026, a slightly higher unemployment rate at 4.8% as demand for labor lessens, and inflation peaking at 3.2% before cooling to 2.3% by the end of 2026. Moreover, the Federal Reserve signaling further rate reductions would improve financial conditions and boost dealmaking prospects in 2026, as noted by the firm.

EY-Parthenon’s analysis underscores the importance of AI and cutting-edge technology in reshaping businesses and enhancing their resilience. CEOs who leverage these innovations and embrace change with confidence are positioned to drive transformative actions within their organizations. The forecast for an increased number of M&A deals in 2026 reflects the optimism and readiness of global corporations and PE firms to capitalize on strategic opportunities for growth and transformation.