London’s mid-market private equity deals fell by 14% in the first half of 2025, reflecting broader UK and global economic uncertainties. Despite the slowdown, London maintained nearly half of the UK’s mid-market deal share, with investor interest sustained by the city’s talent pool and global capital access amid cautious optimism for a rebound.
Mid-market private equity investment in London experienced a noticeable decline during the first half of 2025, as revealed in KPMG UK’s mid-year private equity pulse. The report highlights a 14% drop in deal activity compared to the first six months of 2024, with 168 mid-market deals completed in the capital. Despite this downturn, London still led the UK’s mid-market scene, accounting for nearly 45% of total mid-market private equity backing across the country.
The study attributed this slowdown to a complex backdrop of economic uncertainty, shaped by ongoing geopolitical tensions and apprehensions about potential trade tariffs. Bolt-on acquisitions retained their dominance in London, constituting more than half of all mid-market deals, followed by traditional and leveraged buyouts, and then minority investments. Interestingly, while London and most other regions saw a decline in deal volumes, the South West bucked the trend, recording an increase in mid-market activity compared to the first half of the previous year.
Helen Roxburgh, Partner and Head of KPMG’s London Region M&A team, acknowledged the dip yet remained optimistic about London’s resilience. She cited the city’s deep talent pool, ready access to global capital, and its concentration of high-growth businesses as factors that continue to make London a magnet for private equity investment. Roxburgh expressed confidence that as geopolitical uncertainties ease, London would maintain its leadership position within the UK’s private equity market.
Looking at the broader UK landscape, private equity deal activity overall slowed to its lowest levels since mid-2020, with a 17% year-on-year decrease in transaction numbers. A total of 726 deals closed across the country in the first half of the year, down from 876 in the corresponding period of 2024. The second quarter was notably quieter than the first, a decline largely attributed to geopolitical uncertainty that tempered investment enthusiasm. However, the mid-market segment—defined as transactions that typically range between £25 million and £100 million—saw a less severe fall, with 377 deals registering an 11% decrease compared to the same period last year.
Industry data shows that bolt-on deals continued to dominate the UK landscape as well, comprising over half of all transactions. KPMG’s Head of Corporate Finance, Alex Hartley, pointed out that while economic uncertainty has made deal activity more volatile, there is cautious optimism around a pick-up in deal volumes later in 2025. This optimism is driven by strong investor interest in sectors such as business services, healthcare, and technology, media, and telecoms, which remain vital areas of focus for private equity.
This sentiment echoes findings from KPMG’s earlier 2024 Private Equity Review, which reported a rebound in UK private equity investment last year, with a 4.4% increase in deal volumes and a notable rise in mid-market activity. That report attributed growth to a more stable economic and political climate, which had bolstered confidence ahead of anticipated tax reforms. Despite the relative strength of 2024, the current figures show that geopolitical volatility and trade concerns have tempered the momentum somewhat.
In the context of investor strategy amid uncertainty, US private equity firm Thoma Bravo’s recent launch of a €1.8 billion dedicated European fund targeting mid-market software deals is noteworthy. The firm, which opened a London office in 2023, sees opportunity in Europe’s mid-market software sector, focusing on areas like risk and compliance, healthcare, and CFO tools. Thoma Bravo’s approach reflects a broader view that, despite macroeconomic challenges, Europe offers more attractive valuations and less competition in key growth sectors, especially as businesses increasingly adopt digital and automated solutions.
Meanwhile, UK private equity fundraising figures from the first half of 2025 reveal a modest 2.6% increase to $35.24 billion, even though the number of active and closed funds dropped substantially. The fundraising environment underscores the sluggishness in exits and a cautious M&A market, which partly explains the dip in deal activity. Yet, reports from MarshBerry highlight robust M&A performance in UK mid-market transactions, with a significant 80% increase in deals valued between £25-100 million compared to the previous year, suggesting selective pockets of strength within the market.
Overall, while London’s mid-market private equity activity has slowed, it remains a crucial hub centrally connected to broader UK and European investment dynamics. Investors appear to be navigating a landscape balanced between uncertainty and opportunity, with the potential for renewed momentum if geopolitical and economic conditions stabilise.
📌 Reference Map:
- Paragraph 1 – [1], [2]
- Paragraph 2 – [1], [2]
- Paragraph 3 – [1], [2]
- Paragraph 4 – [2], [3], [5]
- Paragraph 5 – [3], [1]
- Paragraph 6 – [4], [1]
- Paragraph 7 – [7], [6]
- Paragraph 8 – [1], [2], [4], [7]
Source: Noah Wire Services
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The narrative is based on KPMG UK’s mid-year private equity pulse, published on 22 July 2025. The earliest known publication date of substantially similar content is 22 July 2025. The report has been republished across various reputable outlets, including the Financial Times and S&P Global, indicating high freshness. The London Post article was published on 7 August 2025, which is within 7 days of the original report, further supporting its freshness. The article includes updated data but recycles older material, which may justify a higher freshness score but should still be flagged.
Quotes check
Score:
9
Notes:
The direct quotes from Helen Roxburgh, Partner and Head of KPMG’s London Region M&A team, are unique to the London Post article and do not appear in earlier material. This suggests potentially original or exclusive content.
Source reliability
Score:
7
Notes:
The narrative originates from the London Post, an obscure, unverifiable, or single-outlet narrative, which raises some uncertainty. However, the content is corroborated by reputable organisations such as KPMG UK, the Financial Times, and S&P Global, lending credibility to the information.
Plausability check
Score:
8
Notes:
The claims about the decline in mid-market private equity investment in London are consistent with reports from reputable sources, including KPMG UK’s mid-year private equity pulse and the Financial Times. The narrative lacks supporting detail from other reputable outlets, which is a concern. The language and tone are consistent with the region and topic, and there is no excessive or off-topic detail.
Overall assessment
Verdict (FAIL, OPEN, PASS): OPEN
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The narrative is based on a recent KPMG UK report, indicating high freshness. The quotes from Helen Roxburgh are unique, suggesting original content. However, the London Post’s reliability is uncertain due to its obscurity, and the lack of supporting detail from other reputable outlets raises concerns. Therefore, the overall assessment is OPEN with a MEDIUM confidence level.
