2025 Mid-Market M&A Update: Holding For Take-Off?

As the half-way mark of 2025 approaches, mergers and acquisitions activity remains in a state of fitful growth, marked by a number of offsetting market forces and uneven levels of activity. This stands in sharp contrast to the lofty expectations held at the start of the year, when the stage appeared set for a significant resurgence in M&A, driven by a confluence of favourable market conditions, including: an improving macroeconomic environment, with a stabilization in inflation, lower interest rates and a weaker Canadian dollar; narrowing valuation gaps between buyers and sellers; significant and growing dry powder among private investor groups, who face increasing pressure to deploy capital; a backlog of portfolio companies amid a challenging exit market; an expected wave of succession-driven sales by entrepreneur founders; and growth in transactions involving public companies – including mergers, take-privates, spin-offs and asset sales – in response to activist