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Manila Bulletin devider Business devider Trade & Industry devider Philippine M&A value halved in 2025 amid global, domestic uncertainty

Philippine M&A value halved in 2025 amid global, domestic uncertainty

Published Jan 9, 2026 01:09 pm
High-rise buildings in the Ortigas Business Center are seen on Wednesday, Nov. 5. In a report by Bloomberg, the Philippine Stock Exchange Index has dropped 20 percent over the past decade, ranking as the worst performer among major global benchmarks. In contrast, Asia-Pacific stocks climbed 72 percent, while Indonesia’s Jakarta Composite Index soared 82 percent. Photo by Santi San Juan | MB
High-rise buildings in the Ortigas Business Center are seen on Wednesday, Nov. 5. In a report by Bloomberg, the Philippine Stock Exchange Index has dropped 20 percent over the past decade, ranking as the worst performer among major global benchmarks. In contrast, Asia-Pacific stocks climbed 72 percent, while Indonesia’s Jakarta Composite Index soared 82 percent. Photo by Santi San Juan | MB
The total value of the country's merger and acquisition (M&A) deals in 2025 fell 46.5 percent, as external and domestic headwinds prompted more selective dealmaking, according to PwC Philippines.
In its year-end report, PwC said the country’s M&A deals plunged to $4.6 billion last year, just over half of the $8.6 billion recorded in the previous year. The country only registered 74 deals last year, down from 113 in 2024.
“Deal flow was primarily driven by renewable energy transactions and real estate portfolio reorganizations, supported by legislation that enabled larger control deals,” it said.
The energy and natural resources sector accounted for 29.7 percent of the total deal volume, with a combined value of $1.91 billion across 22 transactions. The value, however, is 48 percent lower than $3.7 billion in 2024.
M&A deals in this sector last year were driven by renewable energy assets, with companies seen aligning with the government’s Philippine Energy Plan, which aims to expand the share of renewable energy in the power generation mix to 35 percent by 2030.
PwC said investor confidence in energy and natural resources remained firm as the country’s regulatory agencies adjusted their policies to support clean energy investments.
The largest M&A deal of the year was in this sector, with Razon-led Prime Infrastructure Capital Inc.’s acquisition of a majority stake in the gas business of Lopez Group’s First Gen Corp., valued at $897.5 million.
Across six transactions, the M&A value for the real estate and infrastructure sector last year stood at $1.2 billion, slightly higher than the $1.1 billion in value in the prior year.
The increased deal activity was attributed to sustained demand for logistics, industrial, and commercial assets. It was also supported by clearer zoning, sustained investor interest in urban areas, and the reforms enforced by the Accelerated and Reformed Right‑of‑Way (ARROW) Act.
According to PwC, deals in the industrial sector fell to $180 million in 2025, down from $895.6 million in the prior year. The company said the decline was caused by high borrowing costs, extended project timelines, and shortages in technical talent.
The financial industry generated only $33.3 million in deal value, a sharp decline from the previous year’s record of $908.2 million.
The decline in M&A transactions was not unique to the Philippines, as the broader Southeast Asia region also posted a decline last year.
Based on PwC data, the region’s deal value was pegged at $61.12 billion across 862 deals, nearly 28 percent lower than the $84.5 billion in 2024, which covered 849 deals.
PwC said the weaker performance was triggered by “shifting headwinds in elevated long-term interest rates, US (United States) tariffs, and protectionism,” which led investors to step back from dealmaking.
In Southeast Asia, the Philippines ranked fifth in M&A value, trailing Indonesia, Vietnam, Malaysia, and Singapore, which led the region.
Beyond external headwinds, Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort said selective dealmaking in the country was partly affected by the massive corruption scandal in public infrastructure.
“Good governance is part of the criteria or scorecard before making investments by some global companies, such as compliance with ESG (environmental, social, and governance) standards, since adherence signals good business,” he said in a Viber message.
For the year, PwC expects a rebound in M&A activity as transactions announced in the latter half of last year are now expected to be completed.
The company expects the energy and healthcare sector to generate these deals throughout the year.
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