Food and drink manufacturers in the UK and Ireland are the most confident of all surveyed sectors when it comes to M&A activity in 2025, according to new findings from a survey conducted by UK & Ireland law firm Browne Jacobson.
The industry is poised for investment with growing investor appetite and a majority of leaders expecting inward M&A activity to rise in the next 12 months.
Censuswide surveyed more than 380 C-suite executives and business leaders across the food and drink, real estate and construction, retail and supply chain, technology, and energy and infrastructure sectors on their perspectives of M&A transactions and inward investment in the coming year.
Government support is expected to play a major role in encouraging inward investment. 81% of food and drink respondents said government incentives such as tax breaks or grants would influence future deal activity, while 65% of businesses are actively diversifying their product and service offerings to boost resilience and investment appeal.
Paul Kirkpatrick, partner and head of manufacturing & industrials at Browne Jacobson, said: “The sector has been rocked by sweeping US tariffs, but we’re hopeful the UK–US trade deal will support recovery. It’s no surprise most respondents identified technology and IP as key to driving investment. As trade pressures grow, digital and automated businesses stand out for their efficiency and adaptability.”
Private equity confidence remains high, with 84% of respondents anticipating more PE investment in food and drink M&A over the next year.
Paul added: “We also expect continued consolidation. Acquisitions will be central to growth, especially in expanding product lines and reaching new markets. Investor appetite is particularly strong in areas like alcohol-free drinks, healthy food and free-from products – categories that pair innovation with lower exposure to trade volatility.”
The findings also reveal a growing role for digital innovation and growth. Over a third (35%) of respondents cited growth potential as the primary factor for investment, while 47% pointed to technological innovation, including automation and supply chain improvements.
96% of respondents cited technology and IP as critical to deal-making. 80% expect digital transformation to impact M&A decisions, and 75% say AI will increasingly influence valuations and sector strategy – the highest across all industries surveyed.
Sam Sharp, partner and head of food & drink at Browne Jacobson, said: “Despite cost and supply chain pressures – now worsened by changing tariffs – food and drink manufacturers remain highly confident.
“This reflects what we’re seeing in practice, with rising M&A activity in early 2025. Diversification also stood out – nearly two-thirds of businesses are expanding their offerings to attract investment. This not only improves appeal but strengthens resilience.”
The sector’s confidence comes despite ongoing cost pressures, supply chain disruption and global trade uncertainty. Policy changes and recent trade agreements, such as the May 2025 UK–EU food standards deal and the UK–US tariff easing, have bolstered sentiment with manufacturers increasingly seeing cross-border deals as both viable and necessary for growth.
The report, Inward Investment in the UK and Ireland in 2025, surveyed 383 C-suite executives from companies with turnovers exceeding £100 million across five core sectors.