Merger and acquisitions in Ireland: What to expect in 2026 and beyond
As businesses look ahead to the next 12 months, Ireland’s merger and acquisition (M&A) landscape is gearing up for a period of steady, and in some sectors, significant activity. A mix of improved tax incentives, global market dynamics, political shifts and a surge in private equity competition is shaping the way deals are being initiated and completed.
Brendan Murphy, Tax Partner at Baker Tilly Ireland, takes a closer look at the trends, challenges and opportunities defining the Irish M&A market as we move into 2026.
Domestic M&A: Moderate growth on the horizon
Ireland continues to serve as an attractive hub for international companies, particularly those seeking a strategic entry point into the EU. With this in mind, we expect M&A investment into Ireland to increase in the year ahead.
Acquiring an Irish business already embedded within an existing supply chain is often seen as a more efficient route for businesses to establish themselves in the region rather than establishing a new operational function from scratch, therefore keeping foreign appetite for Irish businesses high.
Competition amongst private equity (PE) firms is also continuing to intensify. As more capital flows into the market, prices are rising which is prompting business owners who may not have previously considered selling, to rethink their priorities and position.
Announced in October, Ireland’s recent increase in the Entrepreneur Relief threshold from €1 million to €1.5 million adds another layer of motivation for business owners. With the revised limits able to avail of the 10% capital gains tax rate for deals signed from 1 January 2026, some transactions may have been intentionally delayed in late 2025 and will likely conclude into Q1 2026, making early-year M&A activity figures look very positive.
Cross border deals – slower timelines, not fewer deals
Cross border activity remains healthy, but a common theme is that the pace of deal completion appears to have slowed down. Recent experience has shown that deals are just simply taking longer to complete. Some factors attributing to this are global uncertainty around tariffs, political leadership changes, and amendments to regulatory environments which has led buyers to proceed with enhanced caution.
Over the past year, one of the biggest hurdles to concluding deals has been valuation negotiations, particularly finalising earn-out mechanisms. Whilst deals are progressing smoothly through early stages such as heads of terms and due diligence, they often may stall when it comes to agreeing the final nuances of the sale and purchase agreement (SPA).
Challenges faced: Rising costs and talent constraints
Staffing shortages and rising overheads represent major challenges across the Irish business landscape. With employment at record highs, wage inflation is accelerating, while increasing minimum wage requirements, auto enrollment pension contributions and electricity and heating costs continue to squeeze margins. These rising costs represent a significant operational risk for companies preparing for M&A.
Opportunities ahead for Ireland
One of the primary buy-side drivers will be the desire to expand into new markets. Tariff pressures are prompting businesses to diversify geographically, often through strategic acquisitions within target market supply chains. Market expansion and supply chain optimisation will go hand in hand as companies reposition themselves for stability and growth.
Ireland remains under the international spotlight, especially from US and UK buyers seeking a foothold in the EU market. On the flip side, this is also a similar situation for domestic businesses looking overseas, with the UK and US often at the top of the list for potential new establishments.
Shifting trends – valuations and PE
For some sectors, valuation trends have increased hugely. Professional services firms, especially in accountancy, are seeing strong demand, fueled by private equity interest. A similar pattern has also followed with financial services firms too, particularly insurance which remains a highly attractive with healthy multiples.
An interesting trend expected to dominate 2026 is the growing number of PE transactions as many PE firms are reaching the point of executing onward sales of assets acquired in previous cycles, and as these portfolios mature, we can expect a wave of activity as assets are perhaps transitioned between funds.
Start early and seek guidance
One piece of advice for business owners is that our team can provide strategic guidance throughout a transaction process, but it’s crucial to engage advisors early, well before an SPA is signed. Early consultation clarifies key considerations and identifies any steps needed to optimise asset readiness for a smooth transaction. From a tax structuring and due diligence perspective, conversations and preparation should typically begin 2-3 years prior to the anticipated completion of the deal.
