Canadian dealmakers look to scale and reinvent amid global instability: PwC Mid-Year M&A Update

•  Canadian M&A deal volume remained relatively steady in the first half of 2026, with 658 deals announced in Q1 and overall activity staying broadly consistent with previous quarters despite some fluctuations in Q2.
• Total deal value was $64 billion in Q1 2026, down from last year’s quarterly average of $97 billion.
• Average deal size eased in the first half of 2026, compared with 2025’s average of $148 million, which was lifted by a smaller number of sizeable transactions in the materials, energy, utilities and financials sectors.

Toronto, ON, June 23, 2026 – Canadian M&A activity remained relatively steady in the first half of 2026, as dealmakers navigated global instability and looked for opportunities to strengthen their market position, according to the PwC Canada 2026 Mid-Year M&A Update released today. While deal volume remained broadly consistent with previous quarters, aggregate deal value was down and average deal size eased, reflecting continued movement in the sector mix.

The report points to a more uncertain backdrop for dealmakers heading into the second half of the year, with Canada’s real GDP growth expected to remain below potential at 0.9% to 1.3% in 2026 and inflation projected at 2.5% to 3.0%. It also highlights prolonged uncertainty around North American free trade, including the future of CUSMA, as a key risk for Canadian sectors that rely on US sales.

The report highlights three sectors in particular:

• Energy: The Iran conflict has created supply shock tailwinds for Canadian producers, pushing oil prices episodically to multiyear highs. But the same volatility is adding inflationary pressure, raising diligence requirements and potentially increasing borrowing costs for larger deals.
  
• Agrifood: Climate volatility, geopolitical shocks and resource constraints are making food resilience a strategic priority. The report points to increased public funding, greater private-sector innovation and a stronger appetite to build ecosystems as drivers of M&A activity.
• Insurance: Foreign insurers are reassessing their Canadian operations, creating a window for domestic carriers to acquire platforms or books of business, build scale and strengthen distribution, underwriting and technology capabilities. Recent deals, including Definity’s acquisition of Travelers Canada and Wawanesa’s acquisition of Everest Insurance Company of Canada, point to this shift.

The update concludes that deals will continue to be an important tool for companies looking to move faster, whether by acquiring capabilities, building scale or divesting non-core assets to fund new strategies.

Read the full report