Quarterly Tech M&A Update | Q4 2025

M&A market developments and valuation environment in the fourth quarter

Technology M&A activity in Europe and Germany normalizes, while market fundamentals remain intact in Q4 2025

Despite a modest slowdown in overall European technology M&A activity in Q4 2025, the market continues to demonstrate resilience and selectivity. A total of 593 transactions were recorded across Europe, representing a 10% quarter-on-quarter decline, yet activity levels remain well supported by strategic demand. Germany stood out as a relative outperformer, with 153 completed deals – reflecting only a 4% decline versus Q3 and still exceeding transaction volumes seen in Q1 and Q2 2025. This underscores a higher concentration of deal confidence in the German market compared to Europe overall.

Strategic buyers continued to drive the market, accounting for more than 92% of all transactions in Q4 2025, highlighting ongoing corporate appetite for technology-led growth. Cross-border transactions represented 61% of total deal activity, reinforcing the internationalization of acquisition strategies and a sustained focus on global market expansion.

At the subsector level, Application Software (291 transactions) and IT-Services (217 transactions) maintained strong momentum, confirming their role as core pillars of technology M&A activity. System Software and Semiconductors showed improving momentum, with M&A activity picking up across both segments. Valuation levels continued to stabilize, moving closer to normalized levels relative to public peers – creating an increasingly supportive environment for well-positioned assets.

In our M&A update, we analyze the current valuation environment in the tech sector, focusing on the following key developments:

• The development of M&A activity across Europe and Germany

• Current valuation levels and trends within key subsectors

• Selected transactions, including Orange Cyberdefense’s acquisition of Ensec AG

We hope you find this report insightful and look forward to further discussions with you.

Quarterly Tech M&A Update Q4 2025.pdf Download PDF

Your TMT team at Oaklins Germany

Jan P. Hatje Hamburg, Germany
Managing Partner
View profile

Christoph Rummelt Hamburg, Germany
Director
View profile

Felix Stehr Hamburg, Germany
Associate Director
View profile

Florian Engel Hamburg, Germany
Senior Associate
View profile

Lukas Girke Frankfurt, Germany
Senior Associate
View profile

Kevin Johannes Kambach Hamburg, Germany
Senior Associate
View profile

Felix Daetz Hamburg, Germany
Senior Associate
View profile

Eddi Dudek Hamburg, Germany
Associate
Kurzprofil

Sam-Louis Klein Frankfurt, Germany
Analyst
View profile