According to PwC Canada’s 2026 mid-year Canadian M&A update, the world is beginning to consider Canada a stable and strategic option amid a fractured global landscape, given the country’s relatively steady deal activity in the year’s first half.
“Geopolitical shifts are reshaping the Canadian mergers and acquisitions (M&A) landscape, opening a rare window for domestic champions to consolidate and scale,” PwC said in its report.
PwC emphasized that dealmakers may stand out in the second half of 2026 if they act with conviction. In its mid-year update, PwC identified three sectors making a difference.
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“In energy, Canadian producers are riding a supply shock while navigating new headwinds,” PwC’s report said. “In agrifood, sovereignty and technology are converging into a generational opportunity. And in financial services, foreign exits—especially within the insurance sector—are opening a rare moment for domestic scale.”
Deal value and volume
For the opening quarter of 2026, the data showed that:
- The aggregate deal value amounted to $64 billion, below the total value in the latter two quarters of 2025 and below last year’s quarterly average of $97 billion
- The average deal size decreased to approximately $98 million, down from 2025’s rough average of $148 million
“Canadian M&A volumes opened 2026 in line with the run rate set through 2025,” PwC’s report stated.
As predicted in its 2026 Canadian M&A outlook, PwC highlighted that the deal volume stayed stable in the year’s first half.
For the first quarter of 2026, PwC noted that companies announced 658 deals, close to the quarterly average of 653 deals in the previous year and just beneath the 671 deals in the fourth quarter of 2025.
For this year’s second quarter, PwC acknowledged that many companies dealt with the effects of the Iran conflict and the increased energy prices, leading to fluctuating deal activity.
According to PwC’s report, “a re-escalation of the Iran war would likely push the global economy into a recession accompanied by high inflation (stagflation).”
PwC expected such circumstances to directly impact dealmakers in sectors such as oil, liquefied natural gas (LNG), nitrogen fertilizers, chemicals, financial services, and sectors relying on petrochemicals and plastics.
“In this situation, Canada’s annual inflation rate could be pushed toward 4%- 5% and cause the economy to contract, even considering the upside for the energy and fertilizer sectors,” PwC’s report said.
Regarding the first half of 2026 as a whole, PwC considered it relatively consistent with prior periods.
“The headline activity masks continued movement in the mix,” PwC’s report stated.
In terms of sectors, PwC noted that materials, industrials, and information technology grew stronger in 2025, became the three most active sectors in the first half of 2026, and comprised over a third of all the year’s deals.
“Conversely, financials—which had gained momentum in the second half of 2025—softened in the first half of the year,” PwC’s report said. “Real estate transactions, which are primarily being driven by private capital, hovered around 2025 lows but showed signs of early uptick.”
In the international arena, PwC stressed the importance of the Canada-United States-Mexico Agreement (CUSMA) renegotiation and broader trade policy factors, given that Canada’s deal activity remained strongly skewed in favour of the US, with more outgoing transactions into the US than incoming transactions into Canada.
For the findings of its report, PwC analyzed Capital IQ data.