Geopolitical tensions, tariff uncertainty, and ongoing economic challenges throughout last year meant that total private equity investment activity fell against the previous year, according to the latest UK Private Equity Review from KPMG UK, with the potential for a resurgence of activity this year as firms look to invest high levels of undeployed capital.
KPMG found that 1,751 deal transactions were completed in 2025, a fall of 10% year on year, with the value of deals, at £176.6bn, up 3.5% over the year. While overall volumes recorded for the year were lower than the post-covid rebound in 2021 and 2022, they were significantly higher than the average recorded in the years immediately prior to the pandemic.
More deals were completed in the first half of the year, with 881 transactions, than in the first six months of 2025. Fewer, larger transactions in the second half of the year saw deal values increase to their highest level since the first half of 2021.
Bolt-ons remained the most common deal type, making up 59% of overall deals, as investors looked to build scale in their existing platforms, however bolt on volumes were 5% lower than their historical average. The volume of buyouts surged to their highest level since 2021, with 298 reported deals.
KPMG expects UK private equity activity to pick in 2026, helped by high levels of available capital, more businesses coming to market, and a renewed focus on improving how companies operate.
