October 21, 2025
The Technology, Media and Telecommunications (TMT) sector remains one of the most active for M&A globally.
In the next instalment of our Sector Spotlight blog we spoke with Aaron Lowery, Translink Corporate Finance UK Director, to explore the key trends shaping dealmaking in the TMT sector, the sub-sectors attracting attention and how business owners can prepare for a successful transaction in the year ahead.
What are the most significant M&A trends currently shaping the global TMT sector, and how is the UK market responding?
AI and data-driven technologies are unquestionably at the forefront of current deal activity with businesses across the sector looking to strengthen their capabilities via acquisition to help drive automation, predictive analytics and operational efficiencies. From software developers to telecoms providers, leveraging AI capability is now seen as an essential.
Cybersecurity is another area of focus. With recent security breaches of high-profile companies being well publicised in the media, organisations are under pressure to reassess risk, compliance and resilience. As a result, budgets are increasing and buyers are actively targeting cyber-first assets.
The Managed Service Providers (MSPs) market continues to experience consolidation, with a number of private equity-backed platforms willing to compete for any high-quality assets which come to market. The need to scale capability, talent and recurring revenue streams is fuelling a steady pipeline of transactions.
In the UK market strategic acquisitions remain active across these growth areas. Buyers are looking to enhance their product offering, expand internationally and access new technologies. Despite broader macro pressures, M&A activity continues to be driven by long-term digital transformation agendas.
Which TMT sub-sectors are emerging as high-growth areas in 2025, and why are investors prioritising them?
The most sought-after sub-sectors reflect broader digital trends including:
Artificial Intelligence – AI is reshaping every corner of TMT, from software development and telecoms to media, cybersecurity and IT services.
Cybersecurity – Following major attacks on organisations such as M&S, Harrods, Co-Op and JLR, the threat landscape has significantly increased in terms of complexity and the sophistication of attacks.
Cloud and cloud-native platforms – Migration to the cloud continues to be a central theme, especially for providers of scalable infrastructure, software and managed services.
Recurring-revenue models – Investors continue to favour MSPs, enterprise software and SaaS businesses which offer high revenue visibility and strong retention metrics.
What value drivers are supporting valuation premiums in TMT M&A, and how can business owners position themselves to benefit?
The market has clearly moved away from a ‘growth at any cost’ approach, with profitability and cash generation now a key focus and metrics such as the ‘Rule of 40’ playing a more prominent role in valuation discussions.
Key value drivers in the sector include:
- High levels of recurring revenue and customer retention
- Exposure to strong growth markets and sectors
- Strong and credible management teams
- Strategic fit and synergy potential for acquirers
To maximise value and readiness for exit, I would advise businesses to be prepared and consider the follow:
Plan ahead – Begin preparing for a potential transaction at least 12 to 24 months before the target exit date.
Benchmark performance – Compare key performance metrics, both financial and operational, against your peers and other successful businesses.
Professionalise operations – Create an environment with strong governance, produce high quality MI and proactively monitor KPIs.
Appoint a high quality advisor – Work with an advisors who understands the market you operate in and the buyer landscapes, and ensure their interests are aligned with yours.
What are international buyers looking for in UK TMT assets, and which markets are showing strongest outbound interest?
International buyers are aligned with UK acquirers in terms of what they’re looking for – profitability, scalable tech platforms, recurring revenues and strategic fit.
Interest from the United States remains strong. The continued weakness of the pound against the US dollar has made UK assets comparatively attractive, especially where bolt-on acquisitions can enhance global platforms or give investors access to European markets.
Mohit Mehta, Director at Dinan (Translink US) commented: “US investors remain active across the UK TMT landscape, particularly where acquisitions can extend capability or accelerate scale. We’re continuing to see strategic engagement from both private equity and trade buyers seeking quality assets.”
Looking ahead: What key developments are likely to shape TMT M&A over the next 12 months, and how should business owners prepare?
The next year is expected to be defined by key several trends including:
- Ongoing investment in AI across all sub-sectors
- Rising demand for cybersecurity and compliance driven SaaS platforms
- Falling inflation and interest rates, which are likely to unlock more deal activity
For management teams and shareholders considering an exit or funding event, staying close to these themes is essential. Strategic positioning, financial robustness and early preparation will remain critical in securing premium valuations in what is set to be a competitive and opportunity-rich market.
If you’re a business owner or investor exploring M&A opportunities in the TMT sector and would like to know how these trends could impact your growth strategy, contact Aaron on alowery@translinkcf.uk.com
