The economic impact of M&A
Successful M&A creates value not only for buyers and sellers, but for the wider economy too.
Our research shows that every GBP1B of U.S.–U.K. deal activity is accompanied by an associated GBP322M of additional U.K. output in the quarter that the deal takes place. In the context of Q1 2026, this translates into an implied GBP10.5B boost to GDP.
There is the question of cause versus correlation. M&A tends to increase in thriving economies, but there is a strong case that M&A also boosts economic activity. When an M&A transaction takes place, the funds are immediately reinvested and circulated across multiple departments, from R&D to product expansion. The result is a significant uptick in productivity as the acquirer races to achieve the strategic goals it set during the transaction.
Every additional GBP1B of U.S.–U.K. M&A activity is associated with GBP322M of additional U.K. economic output in the same quarter.
Applied to the increase in dealmaking in Q1 2026, the analysis implies an approximately GBP10.5B boost to U.K. GDP.
of dealmakers say current large-cap (USD1B+) transatlantic M&A has a positive impact on their country’s economy.
Q8 and Q3. Base: 811 respondents. GBP322M/GBP10.5B figures are from the economic analysis.
The money that changes hands when M&A takes place doesn’t just sit in a bank account. It gets reinvested very quickly. In addition, buyers have a 100-day plan, and they aim to hit the ground running. They also invest more money following completion.
Andrew Edge Partner, U.K.
While our economic modeling focused on the deal activity between the U.S. and the U.K., it is clear these benefits are being replicated in other markets.
Many multinationals have established a presence in Ireland either through greenfield rollouts or M&A. This activity is buoyed by a preferential tax regime, but also by a perceived strong cultural alignment between U.S. and Irish corporates.
For example, the impact of cross-border M&A on Middle Eastern economies is striking, given that capital markets in the region tend to lack depth. M&A is the dominant route for capital coming into Middle Eastern economies, influencing appetite for job creation and confidence levels among private capital allocators in the region.
The analysis does suggest that this GDP boost is mostly limited to the immediate aftermath of the transaction. This is because the GBP322M boost is a completion effect—the combination of the financing, advisory, and deal-closing activity that spikes in a single quarter—rather than newly created economic capacity.
Most cross-border deals are about acquiring existing customers and technology rather than building fresh capacity. But as the research demonstrates, the value of the initial transaction can compound over time, as fresh revenue funds job creation and new projects.
Our survey points to that longer-term effect: 85% of respondents report increased revenues within 24 months of a transatlantic deal. Respondents also cited increased profitability, market share, international expansion, R&D, capex, and hiring, reflecting ongoing investment in growth initiatives which should yield sustainable economic benefits for target jurisdictions.
The deal dividend within 24 months
% of dealmakers reporting an increase in the following areas within 24 months of a transatlantic deal:
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