The outlook for M&A in 2026 is strengthening as market conditions continue to stabilize and confidence among both corporate buyers and private equity firms rises. After several years of volatility marked by supply chain disruptions, inflation and higher interest rates, dealmakers now see a clearer environment for negotiation and valuation. Surveys from Deloitte and the Wall Street Journal show broad expectations for growth in both deal count and deal value, reflecting a market that is preparing for increased activity across the middle market and large-cap segments.
This optimism follows a 2025 market defined by a growth in deal value, a resurgence of large transactions, and more disciplined but active private equity deployment. Improved access to credit, multiple Federal Reserve rate cuts, and greater clarity around tariff implications played major roles in unlocking activity. Buy-side M&A activity grew as strategic acquirers leaned on M&A to accelerate digital transformation, including adoption of AI technologies, consolidate for scale, and divest non-core operations. Private equity investors continued to prioritize businesses with recurring revenue, service-driven models, and minimal tariff exposure. Cross-border interest in North America also strengthened, while more than $1 trillion in private equity dry powder maintained strong demand for high-quality assets. These forces created the foundation for the recovery now fueling expectations for 2026.
Private equity enters 2026 with even greater urgency and opportunity. Exit activity rebounded in 2024 and 2025, and is expected to broaden further as market sentiment improves. The U.S. now holds nearly 13,000 private equity-backed companies, and a significant share of these assets are aging, with more than 30 percent held for seven years or longer. Coupled with rising public markets and expanding exit windows, firms are encouraged by the potential to hit value targets earlier and monetize assets at stronger multiples. Deal flow through October 2025 already approached the $1 trillion mark, with platform LBOs reaching their highest value since 2021. Looking ahead, private equity investors expect an increased emphasis on exits, improved exit opportunities, and a growing focus on mid-market deals and sector specializations. Financing is becoming more accessible, and the pressure to deploy capital remains high.
Taken together, these dynamics point to a more robust M&A landscape in 2026. The year is expected to be shaped by sustained private equity activity, a deeper pool of exit-ready assets, and strong appetite for transformative acquisitions in sectors such as technology, industrials, health care, and energy. International buyers are likely to remain active as they seek stability and diversification in U.S. markets. With valuations more stable and financing conditions improving, the balance between risk and return is becoming more attractive for both buyers and sellers.
M&A Market Activity
U.S. deal volume in November 2025 increased by 12.3 percent as compared to October, with YTD volume 4.6 percent above the total transactions for the prior YTD period. 2025 is on track to surpass overall 2024 activity, highlighting a meaningful pickup in transaction momentum.
The Cleveland M&A market experienced a 10 percent decrease in activity in October 2025 compared to the same period in 2024. Moreover, notable Cleveland-based companies, such as First Financial Bancorp, Tremco CPG, and ARC Health Company all completed strategic acquisitions, with private equity firms Align Capital Partners and The Riverside Company also completing transactions.
Deal of the Month
Legrand has acquired Avtron Power Solutions, a global provider of load banks and power-quality equipment used in datacenters, health care, renewable energy, and industrial applications. Avtron operates five sites across North America and Europe, employs approximately 600 people, and is expected to generate nearly $350 million in revenue in 2025. The acquisition expands Legrand’s presence in mission-critical power markets and strengthens its capabilities in high-reliability testing and power-assurance solutions.
Avtron will continue operating as a standalone business unit within Legrand’s Electrical Wiring Systems Division, led by Ravi Ramanathan. CEO David Cox will remain responsible for Avtron’s day-to-day operations.
Brian DiBella, President and CEO of Legrand North and Central America, stated, “The acquisition of Avtron Power Solutions helps ensure Legrand’s expanding portfolio continues to meet the needs of provisioning critical power and electrical infrastructures.” ●
Sources: PitchBook™, S&P Capital IQ, MelCap Investment Banking knowledge, company websites, Wall Street Journal, Deloitte, GlobalNewswire, and public company filings.
Evan J. Lyons is a Director and Principal at MelCap Partners LLC, a middle-market investment banking advisory firm. For more information on MelCap Partners, please visit www.melcap.com or email [email protected].