The annual study into private equity deal activity found that 188 transactions were completed in the Midlands last year, a marginal rise of 2% year on year. The region bucked the national trend, with overall deal transactions completed falling by 10% year on year.

According to the report, confidence in the Midlands and wider UK market was affected by geopolitical tensions, tariff uncertainty, and ongoing economic challenges throughout 2025. Deal activity in the Midlands was stronger in the second half of 2025, as 99 deals were completed after June compared with 89 in the first half, signalling positive market momentum.

Private equity exits also increased in 2025 compared to the year before (23 in 2024 vs 27 in 2025). Activity was higher in the first half with a total of 15 exits completed, compared to 12 in the second half.

Bolt-ons remained the most common deal type year on year, with 118 completed, as investors looked to build scale in their existing platforms. This was followed by buyouts, of which 38 were completed – a 90% increase compared to the year before (which saw 20 buyouts).

Stuart Sewell, head of M&A for the Midlands at KPMG UK, said: “Although marginal, the Midlands was one of only two regions where private equity deal volumes rose last year, underlining once again the resilience and vibrancy of our regional M&A market against a challenging backdrop. Notably, buyout activity surged, highlighting continued investor appetite for well-run businesses with a clear strategy for growth.

“A pick-up in deal volumes in the second half of the year is a positive sign, and an abundance of dry powder and credit for transactions should see market momentum accelerate further as we move through the year. The climate is right for Midlands firms to press ahead with their expansion plans.”

The Midlands’ private equity interest accounted for more than 10% of the total PE backing in the UK.

The review found that 1,751 deal transactions were completed in 2025, a fall of 10% year on year. UK private equity activity is expected to pick up in 2026, helped by record levels of available capital, more businesses coming to market, and a renewed focus on improving how companies operate.

Alex Hartley, Head of Corporate Finance at KPMG UK, added: “Market and investor confidence continued to suffer setbacks through 2025 as geo-political events created several uncertainties for businesses to navigate, making it a tough year to get deals done. There was plenty of ambition and significant capital to deploy but the bar was set high with a strong focus on businesses and sectors that could trade resiliently in this environment.”

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