The value of Canadian M&A transactions surged in 2025, driven primarily by large cap deals and an acute focus on infrastructure and resources. Total deal value last year was US$118 billion higher than 2024 on slightly fewer deals. Transaction value hit a remarkable US$131 billion in the third quarter of 2025—the highest three-month tally since Q4 2020, according to S&P Global Market Intelligence.
It is the same story globally. Bloomberg data highlights that megadeals pushed M&A transaction value to a near-record US$3.6 trillion last year. This total is 38% higher than 2024 and second only to 2021.
In our year-end update on Canada's M&A landscape and look-ahead to 2026, we provide key takeaways from the latest data and market trends and examine:
- the dynamics of large cap deals in Canadian M&A this past year
- challenges that remain in Canadian dealmaking
- how infrastructure is taking centre stage in Canada
- mid-market activity and what to watch out for in 2026 in Canada
- the Canadian credit markets in 2025 and what's ahead in the coming year
The aggregate value of announced or completed Canadian M&A deals reached US$389.69 billion in 2025, surpassing the total from 2021. Large cap transactions drove this increase as the number of deals decreased. We take a closer look below at the dynamics of large cap dealmaking in Canada this past year.
Utilities, energy and mining were the most active Canadian industries, with a combined deal value of US$195.48 billion. This is just over half of total Canadian M&A value in 2025. The aggregate value of utilities deals rose by 82% in 2025 YOY, energy is up by 257% and mining increased by 220%. Actual deal count declined in all three industries last year.
The increased activity in these industries is not surprising given the focus on digital assets and the intense demand for energy and infrastructure resources. Globally, data center M&A and investment set records in 2025, with more than US$61 billion flowing into this market.
Gold had a standout year as Canadian deal value in the sector more than tripled. In 2025 there were 8 gold transactions worth US $1 billion or more—compared to 1 in 2024. Bloomberg reported that globally, metals and mining M&A deal activity is up 61% this year and 139% in North America alone.
Canadian inbound M&A shot up in 2025, despite the continued uncertainties and challenges to the country's economy. Deal value doubled to US$98.45 billion from US$49.19 billion in 2024, on slightly fewer deals. Last year, there were 16 inbound deals worth US$1 billion or more. In 2024, there were 12. Outbound M&A—where a Canadian organization is the buyer or investor and the target is outside the country—edged higher.
Large Cap Deals Drive Canadian M&A in 2025
The surge in higher-value, strategic transactions has been the most prominent trend in the Canadian M&A market throughout 2025. Publicly announced or completed M&A deals worth US$1 billion or more where a Canadian company is the acquirer, target or seller totaled US$321.9 billion, according to S&P Global data. This is an increase of 62% from last year and a staggering 130% jump compared to 2023. The number of billion-dollar deals spiked to 78 in 2025—up from 54 in 2024 and 52 two years ago.
Key market drivers of the large-cap M&A trend include strategic consolidation by large corporations to enhance market positions, favourable financing conditions due to easing interest rates and increased private equity investment as a result of significant amounts of undeployed capital.
While large-cap M&A activity has spanned a variety of Canadian industries this year, a particular concentration of high-value deals has occurred in the energy, natural resources, financial services and infrastructure sectors.
Large-cap M&A activity in the energy and natural resources sectors has been fuelled by significant investment in energy transition and critical minerals, the strong balance sheets of large industry players, efficiency-driven consolidations aimed at operational synergies and enhanced scale and the strategic desire of companies to secure reliable supply chains amidst ongoing geopolitical uncertainty.
Major energy transactions this year included:
- Ovintiv's $3.8 billion acquisition of NuVista Energy
- EIG’s MidOcean Energy's acquisition of a 20% interest in PETRONAS’ key entities in Canada
- KKR's acquisition of 50% of TotalEnergies’ 1.4 GW solar portfolio (with an enterprise value of $1.25 billion) in North America
- Plains All American's US$3.75 billion sale of its NGL business to Keyera
A notable large-cap renewable infrastructure deal in the year was British Columbia Investment Management Corporation (BCI)'s £1.0 billion take-private acquisition of BBGI Global Infrastructure S.A.
Challenges Remain in Canadian Dealmaking
Despite the rise in large-cap M&A deals in the year, dealmakers in Canada continue to navigate ongoing regulatory scrutiny, tariff uncertainty and economic and political volatility. High-value deals are being creatively structured and carefully drafted to pre-empt and mitigate these risks.
New deal protections have been introduced into the Canadian marketplace to address new risk profiles for possible national security reviews under the amended Investment Canada Act, to quell uncertainties around tariffs and tariff-related legal issues, and other specific industry deal protections where regulatory, trade, economic or other uncertainties continue to prevail.
Infrastructure Takes Centre Stage
The vision for infrastructure development in Canada is an ambitious one. The country's strategy to be globally competitive now depends on getting massive projects built quickly and attracting billions of dollars in private sector investment.
The federal government abruptly shifted its policy in 2025 on advancing nation-building projects and launched the new Major Projects Office (MPO) in late August. Since then, two tranches of projects have been referred to the MPO in energy, critical minerals and trade corridors.
Investors are keenly aware of the opportunities in Canada. The head of North American Infrastructure for US private equity giant KKR told The Globe and Mail in December, “In the key sectors that are driving the biggest growth, be it energy, digital infrastructure, both Canada and the U.S. should play a really big role going forward. You have these two mega-themes that are probably the two biggest ones bearing down on the economy broadly, and they both squarely hit on infrastructure."
We similarly view the Canadian infrastructure industry as remaining a key barometer of foreign investment and a leading driver of M&A activity in Canada in 2026.
Canada's Mid-Market
M&A activity in Canada's mid-market (US$20 million<US$500 million) rose throughout 2025 in both deal value and count. Aggregate deal value last year (US$41.56 billion) surpassed the total for 2024 (US$40.83 billion).
Mining was the most active industry by far with US$10.58 billion in mid-market deals in 2025—with gold accounting for 54% of this activity. Financial services came next, followed by software, energy, capital goods and pharmaceuticals, biotechnology and life sciences.
The defence industry will be one to watch in 2026, especially in private capital dealmaking. Investment in defence and dual-use technologies is accelerating as government policy initiatives push the industry into the mainstream. We have previously written on the spike in global VC deftech deal value in this new era for defence.
Trends in the Canadian Credit Markets
As we look back at 2025 and into 2026, we see several trends in credit markets and M&A financing which have been developed over the past decade and continue to reshape how acquisition debt plays through M&A.
The practical takeaway is that credit is increasingly accessible and available on economic and deal terms that are conducive to transacting for both strategic and financial buyers. What that credit looks like, and from where it is sourced, may differ depending on several factors, including transaction value and nature of the buyer (corporate strategic vs sponsor).
Today, private credit has a seat at the table in almost any discussion around acquisition financing options in Canada. South of the border, PE direct lenders have emerged as a viable and robust option to traditional banks in financing acquisitions of all types and sizes, from mega deals to small-cap. It is now common to see US-based direct lenders as the sole financing source (either in club structures or unilaterally) on inbound cross-border M&A transactions.
In Canada, our banks continue to be comparatively conservative in their leveraged acquisition underwriting standards. However, they remain the usual acquisition financing option for their key relationship large corporates and top tier Canadian sponsors. That said, hybrid debt financing stacks are often seen in Canadian middle market sponsor-driven transactions, with banks providing a senior financing solution and private credit filling in the junior or mezz piece required to complete the transaction. The private credit option, which is now an entrenched part of the broader credit market, offers buyers an alternative that fills gaps left by banks constrained by regulation, risk tolerance or other underwriting limitations, and terms which may be more flexible and buyer friendly.
With rates continuing to improve (even if still above their Covid historical lows) and credit markets continuing to be robust and evolving in ways which will help facilitate transactions, access to credit will be a key driver to continuing strength in M&A activity in 2026.
Looking Ahead
Predictions for M&A activity in 2026 are positive but nuanced. Many dealmakers expect to see the trends of larger transactions and certain key industries in Canada remain in high demand in 2026. The AI boom is driving growth far beyond the technology sector and the level of investment in data centres and the infrastructure that supports them is astounding. In particular, we expect there will be continued growth in AI for certain participants in this industry, including equipment, cooling systems, structural and other integral products.
That said, the outlook for the global economy is unsettled and trade tensions continue. In Canada, regulatory scrutiny remains a concern and our economic relationship with the US is still in flux. And as we saw in 2025, unexpected policy announcements can change the dealmaking landscape quickly and profoundly.
While the path ahead requires a steady hand, the abundance of high-quality opportunities suggests that 2026 is well-positioned to be a year of strategic growth in dealmaking.
Bennett Jones M&A Practice
Bennett Jones' Mergers & Acquisitions practice spans all industries—particularly those that drive the Canadian economy. Bennett Jones is a market leader in dealmaking and earned a Band 1 ranking in Corporate/M&A in Chambers Canada 2026. This is Chambers' highest distinction for dealmaking. To discuss the developments and opportunities shaping the M&A landscape, please contact the authors.
* All numbers are according to S&P Global Market Intelligence in US dollars for announced or completed deals—where a Canadian company is the acquirer, target or seller—as of December 31, 2025.
