UK M&A in 2025: What’s Changed – And What It Means If You Want To “Sell My Business”

If you’re a UK owner-manager quietly typing “sell my business” into Google in 2025, the landscape you’re stepping into looks very different to the one even two or three years ago. Dealmaking hasn’t disappeared – far from it – but the rules of the game have changed.

Here’s how UK M&A is evolving in 2025, in plain language, and what it means for you if you’re thinking about an exit.

How busy is the UK deals market in 2025?

The UK is still Europe’s number one destination for deals, with 3,486 transactions worth around GBP 189bn in 2024 – a big jump in both volume and value versus 2023 (up 28% and 71% respectively) (White & Case, 2025).

But 2025 has started more slowly:

• PwC data shows UK deal volumes fell by over 19% in the first half of 2025 versus the first half of 2024, with deal values down 12.3% to £57.3bn – even though the average deal size actually rose by 8.5% (PwC, 2025).

• KPMG reports an 11.3% fall in mid-market private-equity backed deals in H1 2025 (KPMG, 2025).

• Lower mid-market deals (typical owner-managed businesses) have been subdued in H1 2025, but advisers expect a busier second half as confidence and financing conditions improve (Wilson Partners, 2025).

So what’s really going on? Buyers are still out there and have capital to deploy – but they’re more selective, more price-sensitive and more focused on businesses that can prove resilient profits, strong cash flow and clear strategic fit.

Macro backdrop: Stability is slowly returning

For the first time in a while, dealmakers are talking about stability rather than constant shocks:

• Inflation and interest rates have begun to stabilise, which is gradually improving the environment for borrowing to fund acquisitions (MHA, 2025; Skadden, 2025).

• Several law firms note “cautious optimism” that steady rates and greater political stability will support more M&A in the UK through 2025 (TLT, 2025).

For a seller, that means:

• Buyers can model your future cash flows with more confidence.

• There is still downward pressure on valuations in weaker sectors, but high-quality, well-prepared businesses are holding value.

• Timing matters: coming to market when your numbers and pipeline look strong is more important than ever.

Financing deals: Private credit and creative structures

Finance is the make-or-break factor for many 2025 deals:

• In 2025, higher base rates and choppier bank lending mean financing is “a central determinant of M&A success”, with private credit playing a growing role (Ogier, 2025).

What this means in practice:

• More use of structured consideration – earn-outs, deferred payments, vendor loans and equity rollovers – instead of 100% cash on day one.

• Deals taking longer to assemble as buyers stitch together bank funding, private credit and possibly seller financing.

• Greater focus from lenders on debt service cover, quality of earnings and recurring revenue.

If you’re asking “how do I sell my business in this environment?”, expect more questions about your cash flow, customer concentration and the reliability of your forecasts – and be open-minded about taking part of your price over time.

Regulation: CMA and national security reviews are evolving

2025 is also a turning point for UK merger control and investment screening:

1. Competition & Markets Authority (CMA)

   
   

   • 2024/25 is widely seen as a pivotal year, with the CMA moving to make merger enforcement more proportionate and responsive to growth objectives (Macfarlanes, 2025).

   • There’s a new “Mergers Charter” and procedural reforms aimed at giving businesses clearer expectations and a more flexible approach to remedies (Burges Salmon, 2025; Norton Rose Fulbright, 2025).

   • Recent guidance suggests the CMA is less likely to prioritise purely global deals with limited UK-specific issues, especially where EU/US regulators are already imposing remedies (Akin Gump, 2025).

     
     

2. For many owner-managed businesses outside regulated or highly concentrated markets, that’s quietly good news: getting a deal cleared should, in many cases, be more predictable than a couple of years ago.

   
   

3. National Security & Investment Act (NSI Act)

   
   

   • NSI reviews remain separate from CMA merger control and can still impact transactions in sensitive sectors (defence, dual-use tech, data, critical infrastructure, etc.).

   • First-stage NSI reviews are taking longer, with notifications now often taking weeks just to be confirmed as complete, and decisions stretching close to the 30-working-day deadline (Norton Rose Fulbright, 2025).

   • The government is now consulting on reforms to streamline the regime and introduce targeted exemptions, explicitly aiming to “reduce unnecessary red tape” and support investment (Irwin Mitchell, 2025; UK Government annual reports, 2025).

     
     

4. If your business touches sensitive technology, data, defence, critical infrastructure or certain advanced manufacturing, a buyer may need NSI clearance. That doesn’t mean your deal will be blocked – most are cleared – but it does mean you need to plan for that timeline from day one.

Sector trends: Who’s in demand?

The “hot” sectors in 2025 tell you a lot about where buyers are focusing:

• Financial services, AI, technology and healthcare are expected to remain key targets for buyers seeking growth (TLT, 2025).

• Grant Thornton notes that people and services-based businesses are among 2025’s hottest investment targets for private equity (Grant Thornton, 2025).

• Public M&A in the UK has bounced back strongly in Q2 2025 after a slower Q4 2024/Q1 2025, helped by strong equity markets and stable rates (LexisNexis, 2025).

On top of that, big headline deals – such as the Vodafone–Three telecoms merger creating the UK’s largest mobile operator – underline that the UK remains an attractive market for transformational deals when the strategic logic is strong (The Times, 2024).

For smaller, privately-owned businesses, the message is:

• If you sit in a sector aligned to long-term themes (technology, healthcare, professional services, specialist manufacturing, infrastructure-linked services), buyers are still keen – but they expect cleaner financials, stronger governance and clearer growth stories.

• If you’re in a more challenged sector (discretionary consumer, some traditional retail), preparation and positioning matter even more to stand out.

What has really changed for owner-managers who want to “sell my business”?

Putting it all together, here’s what’s different in 2025 if you’re thinking about an exit:

1. Quality over quantity

   
   

   There may be fewer deals, but the ones that complete are typically larger, better-quality businesses with strong fundamentals. A half-prepared, “let’s see what happens” sale process is far more likely to fail in 2025.

   
   

2. More sophisticated buyers

   
   

   Private equity funds, trade buyers and family offices have deeper data expectations. They want:

   
   

   • Monthly management accounts and strong financial controls

   • Clear evidence of recurring or repeatable revenue

   • Robust contracts, IP protection and compliance

   • Realistic, data-backed growth plans

   
   

3. Longer timelines and more moving parts

   
   

   Financing, regulatory analysis (CMA/NSI), tax structuring and legal due diligence can all lengthen the path from first conversation to completion. It’s still entirely possible to sell efficiently – but only with proactive planning and good advisers.

   
   

4. Deal structure, not just price, is negotiable

   
   

   In a world of higher rates and tighter debt markets, you’re more likely to see:

   
   

   • Earn-outs linked to profit/EBITDA

   • Deferred consideration over several years

   • Buyers asking you to roll some shares into the new structure

   • Vendor loans or “stub equity” as part of the consideration

     
     

5. None of these are bad in themselves – they can even increase your total exit value – but they need careful negotiation and risk-sharing.

   
   

6. Preparation now creates options later

   
   

   The owners who will do best in this “new normal” are those who start acting like a buyer years before they go to market: tightening controls, documenting processes, building a reliable second tier of management and cleaning up legacy issues.

A practical checklist if you’re thinking “I want to sell my business”

In 2025, before you speak to buyers or list your company with a broker, you should aim to:

• Sort your numbers: Clean, reconciled management accounts, clear add-backs, and a sensible normalised EBITDA.

• Stabilise your team: Reduce key-person risk (especially if you are the business). Buyers want to see resilient operations if you step away.

• Tidy contracts and compliance: Customer, supplier and employment contracts properly documented; IP assigned to the company; regulatory licences in order.

• Address “red flag” issues early: Director loan accounts, disputed shareholder arrangements, wrong or irregular dividends, or unresolved tax positions will all slow a sale and can kill value.

• Clarify your personal goals: Do you want a clean exit, a phased handover, or to stay on with equity? Being clear on this shapes which buyers and structures make sense for you.

The better prepared you are, the more likely it is that when the right buyer appears – and when financing and regulation line up – your deal actually gets over the line at a price you’re happy with.

How Lexis Capital Group can help

In this more demanding 2025 environment, you don’t just need someone to list your business – you need a partner who understands how deals are really getting done.

Lexis Capital Group focuses on UK owner-managed companies where founders are planning retirement, facing shareholder disagreements or simply ready to de-risk and “sell my business” without chaos. We combine hands-on operational experience with legal and commercial expertise to help you: prepare your business for sale, navigate the evolving UK regulatory and financing landscape, and connect with serious buyers – including our own capital – who value what you’ve built. If you’re considering an exit in the next few years and want a realistic, strategic plan rather than just a valuation headline, Lexis Capital Group can work with you to get your business genuinely deal-ready and positioned for the best outcome.