When I speak with business owners across Australia, a common theme comes up time and again: ‘Is now the right time to sell my business or bring in outside capital to grow?’
While dealmaking activity in Australia has slowed to its lowest in more than a decade, there’s still strong appetite for well-run mid-sized businesses. If you’re thinking about retirement, succession or growth, the trends we’re seeing in the market today will matter to you.
Why the slow down?
Many factors have contributed to the slow M&A market activity in the first part of 2025, including higher-interest rates, geo-political tensions such as US tariffs and broken trade deals, a weaker economy and general global uncertainty. This has caused businesses to delay big decisions or adopt a more cautious approach, although the tides are starting to turn as interest rates come down and people adjust to geo-political noise as the new-normal.
Buyers want mid-sized businesses
Almost three-quarters of all completed deals so far this year involved businesses worth under $50 million. This is where demand is strongest and if your business sits in that range, you are in the buyer sweet spot. Corporates and private equity firms are looking for businesses that they can acquire more easily and ‘bolt-on’ to their existing businesses to expand their portfolios or achieve quick growth.
Timing is key
Australia’s Reserve Bank is expected to continue to cut interest rates this year and into 2026. That will make financing acquisitions cheaper and could push deal activity and valuations higher. This means that now is the time to start preparing. If you wait until you’re ready to sell, you may miss the wave of activity that could reward the businesses who plan ahead.
Private equity is hungry for opportunities
Private equity deal values have surged this half of 2025, with investors sitting on roughly $30 billion in Australia that they still need to put to work. I’m seeing this play out in conversations where PE firms are actively seeking partnerships with quality businesses. If you’re preparing to sell, PE buyers could offer a competitive price. If growth is your goal, they can also provide capital and expertise to help scale your business.
Deals are more complex – preparation pays off
Buyers at the moment are taking longer to complete deals and are increasingly relying on performance-based earn-outs. To many clients this can feel daunting, but in my experience, a well-prepared business not only navigates these hurdles more easily, they also secure better terms. I recommend having your financials, governance and succession plans in order, which can make a huge difference to your outcome.
If you’re considering a sale or capital raise in the next few years, my strongest recommendation is to start planning now. Review your options, which could be a trade sale, private equity partnership or capital raise.
The next step is to get the right people around you early – advisors will guide you through structuring, timing and negotiation. And most importantly, don’t underestimate the time it takes to get your business’s books in order – waiting until you’re “ready to exit” often reduces your flexibility.
While the headlines say deal activity is down, the reality for mid-market businesses is far more encouraging. Buyers are still active, private equity has capital to deploy and conditions are shifting in your favour.
If retirement, succession or growth is on your horizon our Corporate Finance team can help you get organised and identify your best options. Whether it’s selling a non-core business or tiding up your corporate structure to improve your business’s valuation, raising capital through PE, or having the right succession plan in place, we provide a full range of specialist services within one fully integrated firm to help you achieve your goals.
