Cross-border deals rebound globally as regulatory complexity intensifies
International M&A, IPO and investment activity has grown in 2025, driven by supply chain priorities, funding availability and strategic expansion goals.
However, heightened regulatory scrutiny across major jurisdictions means early planning and coordinated execution are essential for deal certainty.
According to Pitchbook (Q3 Global M&A report 2025), 2025 is set to surpass 2021 in global transactions completed. After a slow start due to economic uncertainty, activity accelerated in the second half, with a substantial uptick in cross-border deal value driven by reduced interest rates and renewed investment appetite.
Cross-border M&A volumes as a share of total M&A are at a five-year high, reflecting renewed confidence in international dealmaking despite shifting economic and political conditions.
Beyond M&A, group reorganisations increasingly included cross-border elements, while venture capital (VC) and private equity (PE) investors showed growing appetite for overseas investments and international stock exchange listings.
Client success story
Osborne Clarke advised pan-European lighting company Inovara Group, an Ambienta portfolio company, on its acquisition of IBL Lighting Ltd. IBL is an innovator in LED engine design and provider of architectural lighting solutions to a global customer base. Its high-performance products have been used in flagship projects around the world, including The Peninsula London, Marina Bay Sands in Singapore, and the National Museum of Qatar.
Inovara (formerly Collingwood Lighting) is a longstanding client of the firm, since it advised Ambienta on its platform acquisition of Collingwood in 2021. Osborne Clarke has advised the group on a number of international bolt-on acquisitions since. This latest acquisition represents a strategic expansion for Inovara, uniting its portfolio of design-led European brands with IBL’s technological expertise and international sales channels.
Osborne Clarke's team was led by William Nicolson, private equity Partner, and was made up of specialists from across M&A, banking, tax, commercial and employment law. The deal spanned multiple jurisdictions globally and was led out of Osborne Clarke’s UK offices with support from Osborne Clarke China (particularly partner Guohua Zhang and associate Leila Liu), in collaboration with KPMG and PwC.
United States dominates as both acquirer and target
The United States dominates as both acquirer and target, especially in technology and life sciences. Its stable economy and deep capital markets attract significant European investment. Despite some transaction pauses around elections and tariff announcements, a strong US economy, dollar strength, and available private capital support continued investment.
US investment enables firms to compensate for domestic market stagnation, diversify income sources and access innovation, expanded markets, greater capital availability and improved exit valuations.
Europe is a major hub for both inbound and outbound deals, with the UK, Germany and France as key participants. European firms often look abroad for growth and diversification in response to regional uncertainties.
European acquirers have invested significantly more by value in North America than vice versa, though North Americans complete more deals in Europe. This suggests Europeans make larger investments per deal while North Americans execute higher volumes of smaller transactions, influenced by currency shifts and lower non-US interest rates making American assets attractive to European buyers.
China, Hong Kong and Singapore are central Asia-Pacific investment hubs, with India emerging as a significant player in technology, telecommunications and services.
Private equity leads on complex cross-border transactions
Private equity is well-positioned for complex cross-border transactions, supported by ample capital, accessible funding (particularly private credit), active secondary markets and international structuring expertise. Cross-border PE saw significant growth in H1 2025, driven by increased US outbound investment into Europe.
Cross-border initial public offering (IPO) activity reached a 20-year high in H1 2025, with 14% of global deals being cross border (E&Y Q2 2025 Global IPO Trends Report). China and Singapore emerged as dominant issuer sources, while the US became the preferred destination. Escalating China-US tensions and stricter listing rules may drive more Chinese issuers toward local exchanges including Singapore.
Non-domestic IPOs offer access to larger, more mature capital markets and diverse investor pools, potentially leading to higher valuations and increased liquidity, plus access to industry-specific investor interest and lower transaction costs.
Save for investments in AI companies, where there was healthy competition for high-growth prospects, cross-border VC activity was subdued in 2025 as investors took a cautious approach to early-stage investing, though European start-ups saw slight increases in cross-border funding.
Cross-border investment offers high growth potential, diversification benefits and access to global talent and innovation, allowing investors to capitalise on foreign market opportunities while mitigating risk across different economies.
Deglobalisation drives regional separations in corporate reorganisations, with international de-conglomeration continuing as investors favour strategic clarity.
Key drivers of cross-border activity
Strategic objectives
Acquirers seek to expand customer bases, diversify risk, widen distribution channels, access specialised talent and achieve synergies through cross-border dealmaking. Consolidation drives larger transactions for competitive positioning.
Market exposure
Cross-border activities stimulate innovation and enhance adaptation to different markets, talent, cultures and technologies through exposure to global trends.
Supply chain resilience
Near-shoring, onshoring and dual-sourcing remain priorities as businesses seek reliable cross-border suppliers to mitigate risks and ensure continuity, reducing impact of US-China trade conflicts.
Funding availability
Improved funding, especially private credit, supports complex multi-jurisdictional deals and provides financing certainty.
Economic policy
Tariffs, industrial policy, export controls, cost savings needs and expanded foreign direct investment (FDI) screening shape strategy, valuations and timelines.
Active sectors for cross-border deals
- Energy transition: Investment in renewables, storage, hydrogen, carbon capture utilisation and storage (CCUS) and e-mobility driven by decarbonisation goals. Foreign investors are attracted by stable regulatory frameworks and subsidies. Cross-border deals enable economies of scale and supply chain resilience essential for climate goals.
- Technology, media and communications: Demand for digital infrastructure, cybersecurity, semiconductors, AI and cloud computing drives companies to access technology, talent and markets internationally.
- Life sciences and healthcare: Pharmaceutical pipeline replenishment, medtech and healthcare services attract interest for access to new markets, technology and regulatory environments.
Other active sectors:
- Financial services: Payments, wealth management, insurtech and insurance see robust PE and strategic investment seeking new customer bases and regulatory arbitrage.
- The built environment and mobility and infrastructure: Investment in commercial real estate, logistics hubs and infrastructure projects (ports, airports, smart cities) seeks stable, long-term returns. Companies are targeted that can improve global reach, integrate technology and enhance last-mile delivery capabilities.
- Retail and consumer: Global brands pursue acquisitions to expand into new markets, particularly in e-commerce, luxury goods and food and beverages.
- Industrial and advanced manufacturing: Companies are diversifying supply chains, accessing new technologies and adopting smart manufacturing and robotics.
- Agribusiness and food technology: Companies seek new markets, innovative technologies and secure supply chains for essential commodities.
- Education and educational technology: Digital learning platforms attract investment as providers seek to reach new student populations and offer innovative solutions.
Regulatory challenges vary by sector
Cross-border deals face complex regulatory requirements across multiple jurisdictions with different merger reviews, foreign investment approvals, subsidies rules, export controls, sanctions, data-sharing restrictions and sector approvals. These requirements often clash and run on different timelines, particularly where business transfers or control changes occur. In respect of the sectors highlighted in this report:
Energy transition
Regulatory uncertainty, diverging regional policies and national security scrutiny create challenges for energy deals. Subsidy rules differ between UK and EU, export/sanctions rules affect funding, and extensive ESG due diligence may be needed. Technical diligence is required where traditional assets, renewables and technology integrate, with licensing and grid access creating deal risks.
Technology, media and communications
Technology deals often require competition and FDI filings across many countries, with the EU and UK seeking different remedies. Cross-border data and technology transfers face restrictions under data protection laws. Semiconductors, cybersecurity and AI deals face national security reviews and additional governance rules. Restricted technology must be ring-fenced with staged access before closing.
Life sciences and healthcare
Rights and approvals do not automatically transfer between countries. Due diligence must establish intellectual property ownership and freedom to operate. Patient data transfers face strict cross-border rules. Manufacturing and sales approvals may need new applications. Foreign ownership limits may require minority stakes or phased deals.
How to navigate cross-border complexity
Cross-border transactions are inherently complex, involving multiple jurisdictions, diverse legal frameworks and numerous stakeholders. This complexity is further compounded by an increasingly restrictive regulatory environment across major markets. However, with careful planning and proactive measures, companies can position themselves effectively to navigate these challenges and enhance deal certainty.
Further considerations for navigating cross-border complexity >
Early preparation essential for 2026 deals
Concern remains about potential disruptions given recent years of extraordinary events. There is still the risk of a much-predicted stock market correction or larger crash. Conflicts in the Middle East, Asia and Eastern Europe could escalate, destabilising global markets. However, in the absence of these events, most experts expect continued activity growth in 2026.
In Europe and Asia, tariff considerations may drive increased US acquisitions to minimise trade friction, or companies may favour domestic/regional transactions over distant cross-border deals. More deals may include tariff-related conditions. The OECD has identified downside risks concerning corporate leadership, including escalating trade barriers, inflation volatility, tighter fiscal constraints, and financial market repricing affecting cross-border dealmaking.
Some regulators are promoting more lenient M&A regimes to encourage investment, which may benefit 2026 activity.
The most successful 2026 cross-border deals will address regulatory planning, financing certainty and integration from the outset. With intensifying regulatory complexity across major jurisdictions, early preparation, practical structuring and coordinated execution are essential for success.
Speak to one of our experts.
Our experts
Co-head International Corporate Group, Partner, UK
Knowledge Lawyer Director, UK
Co-head International Corporate Group, Partner, Germany
Head of Business Transactions Knowledge, UK
Articles
Cross-border deals rebound globally as regulatory complexity intensifies
AI likely to drive global technology transactions in 2026
Healthcare and life sciences deal activity to accelerate across global markets in 2026
Innovation and renewables will underpin energy transition M&A and investments in 2026
Atlantic crossing: How US acquirers are reshaping dealmaking in Europe
© Osborne Clarke 2026
Privacy Policy Terms and Conditions Cookie Policy
Legal Notice: When you read about Osborne Clarke on this site, we are either referring to our international organisation, Osborne Clarke Verein (OCV), or one of its member firms. OCV is a Swiss verein and doesn’t provide services to clients. The OCV member firms are all separate legal entities and have no authority to obligate or bind each other or OCV with regard to third parties. To find out more, please click here.