For every £1 of US investment into UK businesses via M&A, UK GDP rises by 32p
New analysis finds that every additional £1bn of real UK-US M&A activity is associated with £322m of additional UK economic output in the same quarter – equivalent to a 32p increase in UK GDP for every £1 of US investment into UK businesses via M&A.
The research, from international law firm Winston Taylor, is based on analysis of quarterly UK GDP and M&A data from 2005 to 2025. Applying the model to Q1 2026 – which saw a spike in transatlantic dealmaking – the analysis indicates that the level of US-UK M&A during the quarter was associated with a model-implied £10.5bn increase in UK GDP.
Ahead of the Autumn Budget later this month, the findings highlight the potential economic significance of cross-border investment into UK companies, as policymakers consider the conditions needed to attract and retain international capital.
Transatlantic M&A delivers benefits beyond the deal
The research, part of Winston Taylor’s new The Deal Dividend report, is supported by a global survey of over 800 M&A decision-makers. The survey finds that the economic benefits of transatlantic M&A extend beyond the UK, as nine in ten (91%) decision-makers say current levels of large-cap ($1bn+) transatlantic M&A have a positive impact on their country’s economy.
At company level, 85% of M&A decision-makers report increased revenues and 85% improved productivity within 24 months of a transatlantic deal. The majority also report improvements in profitability (85%), market share (83%) and international expansion (83%).
AI and infrastructure demand continue to shape acquisition strategy
The surge in AI investment is also expected to continue, with almost a third (31%) of decision-makers reporting that AI and infrastructure demand is the single biggest factor expected to influence acquisition strategy in 2026-27.
Figure 1: Key factor influencing transatlantic acquisition strategy
Rank | Which factor most heavily dictates your strategy when evaluating transatlantic acquisition targets over the next 12-18 months? | Global average |
1 | AI and infrastructure demand | 31% |
2 | Extending our existing sector footprint | 15% |
3= | Accessing deeper capital markets | 13% |
3= | Regulatory/political factors | 13% |
4 | Acquiring tech/IP | 12% |
5 | Currency and valuations | 11% |
6 | Activity compared to new platforms | 4% |
The findings point to deal activity in 2026 being driven not only by the desire to access to new markets, but by the need to acquire technology, capabilities and infrastructure that can support future growth.
Deal appetite remains strong despite regulatory friction
The research also shows that M&A decision-makers are adapting to a more demanding regulatory environment. More than half (53%) have modelled longer timelines or higher costs because of tighter foreign direct investment and national-security screening.
Almost half (45%) are making greater use of joint ventures or minority investments, while 26% have abandoned a deal before due diligence because of tighter screening.
Despite these challenges, 83% of decision-makers expect large-cap transatlantic M&A activity to increase over the next 12 months.
Emma Danks, partner and head of UK Corporate at Winston Taylor, commented: “The clear economic effect of M&A on GDP shows how important it is to maintain the current conditions that allow this capital to move freely across borders, for the benefit both of businesses and at a national level. For the UK, that means thinking about M&A as part of the wider growth environment, rather than simply as a series of individual transactions.
“Transatlantic dealmaking is one of the most powerful tools the new chancellor has for delivering growth, and protecting it means avoiding unnecessary friction. The value M&A brings to the UK economy should give policymakers a clear reason to preserve the CMA’s current growth mandate, to align new regulation with global standards, and to maintain the stable interest rate environment that investors rely on.”
Nick Usher, partner and co-chair of Winston Taylor’s London office, added: “The fact that dealmakers remain confident in the transatlantic M&A pipeline is telling. They do not appear to see today’s regulatory and geopolitical challenges as a reason to retreat from US-UK deals; instead, they are increasingly treating them as just like any other factor that needs to be identified, priced in and planned for.
“That AI is still dominating the conversation will not come as a surprise to many, but it is interesting to see that valuations are considered less important by M&A decision-makers. US dealmakers are evidently not targeting UK companies because of a bargain price, but instead tapping into what is seen as a respected market for developing companies.”