Global mergers and acquisitions (M&A) are poised for a significant rebound in 2026 as corporate confidence returns despite lingering macroeconomic headwinds. However, to navigate persistent valuation disagreements and stringent regulatory oversight, dealmakers are increasingly relying on specialized transactional insurance to safeguard their capital investments.

The fourth edition of the Global M&A Trends and Risks report, compiled by legal practice Norton Rose Fulbright alongside financial intelligence provider Mergermarket, reveals that 58% of respondents expect their use of Representation and Warranty (R&W) and Warranty and Indemnity (W&I) insurance to expand this year compared to 2025. Notably, 32% of participants anticipate a dramatic increase in insurance adoption. Demand for these risk-mitigation tools is particularly pronounced across developing corridors in South and Southeast Asia, as well as Africa, where buyers utilize coverage to facilitate complex cross-border negotiations.

Reviving Market Optimism and Core Drivers

Overall sentiment across the corporate sector has shifted positively. Fifty-two per cent of business executives forecast an increase in global deal volume in 2026 relative to the previous year—a substantial rise from the 38% recorded in the 2025 iteration of the survey. One in five executives goes further, predicting a marked surge in completed transactions.

The technology sector continues to serve as the dominant catalyst for international expansion, with 67% of dealmakers designating tech assets as their primary target, ahead of traditional pillars such as industrial manufacturing and energy infrastructure.

Within the technology sphere, artificial intelligence (AI) remains the standout growth driver:

• Market Attraction: 78% of respondents view AI as offering the most attractive dealmaking opportunities in 2026, up from 60% in 2025.

• Target Preferences: 24% of overall participants—and 38% within the private equity segment—are actively pursuing targets that incorporate substantial AI capabilities.

• Pure-Play Firms: A further 14% of buyers are targeting dedicated pure-play AI enterprises.

Unallocated capital, or private equity dry powder, represents another critical engine for transactional momentum, cited by 48% of survey participants as a top-three factor. Sector consolidation (45%) and corporate carve-outs of non-core assets (37%) are also expected to generate consistent transaction flow.

Regional Outlook and Liquidity Conditions

Dealmaking enthusiasm is strongest in mature Western economies. In the United States, 48% of respondents expect a significant rise in activity, whilst 43% hold identical expectations for European markets. Canada displays the highest domestic confidence, with 57% forecasting market growth. Momentum is similarly building across the Asia-Pacific region, bolstered by supply chain restructuring and corporate divestments.

On capital availability, private credit has solidified its position as an essential funding mechanism:

• 86% of respondents anticipate that private debt will remain a primary source of transaction funding over the next two years.

• 50% expect overall credit conditions to ease, including 19% who foresee a marked improvement in borrowing terms.

Key Barriers to Execution

Despite widespread market optimism, executing deals remains challenging. For the first time in recent years, valuation mismatches between buyers and sellers have emerged as the chief obstacle, cited as a top-three barrier by 48% of respondents. This issue outranks general geopolitical volatility (39%) and financing constraints (37%).

From a regulatory standpoint, antitrust scrutiny poses the single largest threat, averaging 35% of top-two responses globally. International sanctions and anti-corruption compliance follow at 32%, with foreign direct investment (FDI) regulations cited by 26%.

Commenting on the survey results, Raj Karia, global head of corporate, M&A and securities at Norton Rose Fulbright, observed that corporate leaders are re-entering the market with heightened strategic discipline following period of market instability. He emphasized that whilst regulatory and geopolitical pressures endure, dealmakers are adapting through flexible financing structures, targeted risk management, and strategic allocations to high-impact sectors like artificial intelligence.