Shoosmiths recently sponsored the Mergermarket M&A Forum 2026, and a theme of discussion that came through clearly on the day: international appetite for UK assets remains robust - albeit more competitive and increasingly sector-driven.

Published: 29 June 2026
Authors: Ben Turner

Despite macroeconomic headwinds, geopolitical uncertainty and an uncertain financing environment, the UK continues to attract significant inbound capital, underpinned by its depth of innovation, regulatory stability and global connectivity.

A resilient destination for international capital

Discussion highlighted recent Office for National Statistics data showing that the UK continues to attract significant levels of foreign investment, with inward FDI stock remaining above £2 trillion. While annual inflows have moderated, they remain material, underlining the UK’s resilience as a destination for international capital underpinned by a relatively stable and investor-friendly regulatory environment and a significant valuation discount of UK securities when compared to their US peers .

This resilience is reflected in Shoosmiths’ own deal experience. Analysis of our recent transactions demonstrates a consistent pipeline of inbound investment into UK targets, spanning both strategic M&A and growth capital.

Notably, a significant proportion of recent UK-facing deals we have advised on involve overseas investors acquiring or investing into UK businesses, reinforcing the UK’s status as a core hub for international capital deployment.

Strong activity across mid-market transactions

While mega-deals continue to shape headlines, our data indicates that inbound investment remains particularly active in the mid-market, where valuation expectations are more aligned and processes are often less competitive.

Recent examples include:

• The £72.5m acquisition of UK-based defence engineering business STI Enterprises by Swedish-listed NOTE AB
• The sale of Hive Media Control Ltd to Panasonic Projector and Display Corporation (Japan)
• Investment into ClearToken Holdings Limited by a consortium including Nasdaq and Coinbase

These transactions highlight continued interest from North America, Europe and Asia, with overseas buyers targeting scalable UK platforms.

Sector focus: technology, energy and services lead the way

Inbound investors are increasingly sector-selective, with capital concentrating in areas aligned to long-term structural growth themes.

1. Technology and innovation-driven businesses

Technology remains the standout sector in inbound investment, particularly:

• AI and data-driven platforms
• Fintech and payments infrastructure
• Cybersecurity and software solutions

Examples from our dealbook include:

• Multiple overseas-backed investments into UK AI businesses, including healthcare and legaltech platforms
• US and European investors backing UK fintech and crypto infrastructure businesses such as ClearToken
• Cross-border investments into cybersecurity and enterprise software companies

The UK continues to be seen as a global leader in early-stage and scaling technology businesses, drawing institutional capital from across jurisdictions.

2. Energy transition and infrastructure

There is also clear momentum behind energy transition and infrastructure-related assets, driven by global decarbonisation targets and government policy support.

Shoosmiths’ data highlights inbound investment into:

• EV charging and clean energy platforms
• Renewable and climate tech ventures
• Digital infrastructure and environmental services businesses

This reflects the UK’s positioning as a key testing ground for energy transition technologies.

3. Financial services and professional services

Inbound interest remains strong across regulated industries and services-led businesses, including:

• Insurance and financial advisory platforms
• Legal and professional services firms
• Accountancy and compliance-led businesses

Transactions such as the investment into Northridge Law by US private equity and cross-border accountancy acquisitions demonstrate the UK’s continued appeal as a stable, high-quality services market.

Increasing sophistication in deal structures

Inbound transactions are also becoming more complex and structured, reflecting both valuation gaps and risk allocation dynamics.

Across deals, we are seeing:

• Increased use of earn-outs and deferred consideration
• Greater reliance on warranty & indemnity insurance
• More cross-border structuring and multi-jurisdictional coordination

For example, many transactions in the dataset include earn-out mechanisms tied to EBITDA or revenue performance over multiple years, indicating a continued focus on bridging valuation expectations.

Outlook: cautious optimism, but sustained inbound demand

Looking ahead, the outlook for inbound M&A into the UK remains cautiously optimistic. Key drivers include the continuing strength in innovation-led sectors, the UK’s established legal and regulatory framework (which promotes greater deal certainty) and the comparative affordability of UK assets. Taken together, these factors should continue to drive ongoing interest from global private capital

While macroeconomic factors may continue to impact deal volume and timing, the underlying fundamentals suggest that the UK will remain a priority market for international investors.