2026 is the year for firms to attract PE Investment

Historically, appetite for investment in accountancy firms has been limited due to regulatory restrictions, business model constraints and scalability challenges, comments Christian Davis, associate partner, JMAN Group

However, this is changing. Influenced by developments in the US, this year, private equity (PE) firm Cinven set a new benchmark by announcing a majority investment in Grant Thornton UK, outbidding a riv

al offer involving a proposed US merger in the largest accountancy PE deal of the year.

Soon after, UK PE firm Apax agreed a £700m ($933m) deal to acquire the accounting arm of Evelyn Partners, while DJH Mitten Clarke accountancy and financial services group completed its sixth regional acquisition with continued backing from PE firm Tenzing.

Several factors account for PE’s growing interest in accountancy. Primarily, accountancy firms typically have stable, recurring revenue streams, unlike other sectors that might be more susceptible to economic downturns.

Secondly, the sector is on the cusp of significant transformation, with advances in artificial intelligence continuing to redefine how firms operate and widen the gap between those that have modernised and those trying to catch up. This creates a major opportunity for PE investors to help shape and benefit from the next wave of industry innovation.

Thirdly, by streamlining capital structures, accountancy firms can reduce their cost of capital and strengthen overall financial performance, making them even more appealing.

To this end, 2026 is expected to be another defining year for PE-backed consolidation in the sector, with the attention shifting to mid-market firms as valuable investment opportunities.

According to a recent study nearly all mid-tier accountancy firms have already been approached by at least one PE house this year, with two-thirds (64%) viewing PE investment as the top macro trend shaping the profession. A separate report reveals nearly half (46%) of the top UK accounting firms are now open to PE investment, with 27% already having taken funding and a further 19% prepared to consider it in the future.

Of course, this presents an exciting opportunity for mid-tier practices to attract PE interest. But only if they modernise their operational foundations. Whereas accountancy mergers and acquisitions (M&As) historically relied on partner relationships and headline financials, today’s deals are driven by sophisticated analytics. More than ever, PE investors are demanding comprehensive data insight beyond routine operations, seeking granular analytics to evidence performance and trends rather than just headline growth metrics.

This narrative enables investors to leverage data assets in investment cases and assures management that their data platforms can scale effectively, especially important for firms pursuing M&A strategies.

Put simply, if your firm lacks strong, reliable data and cannot present it clearly to demonstrate both current value and operational flexibility you risk falling to the bottom of the acquisition list or stifling PE interest altogether. 

In terms of achieving this, to begin with it’s about having the right technology in place. In our experience, all too often firms will choose large, inflexible systems to solve all their data needs, but this can be costly and inefficient. For example, spending over a year migrating to AI-powered software to track transactions may overlook a better, more holistic solution.

A centralised data platform offers a smarter alternative, providing rapid insights and acting as a single source of truth. This approach simplifies operations, improves data accuracy and supports scalable decision making, making a more attractive proposition for investors seeking seamless interoperability.

Of course, technology is only part of the story. Equally important is the ability to effectively use data. A robust data strategy here is a must. This should not only provide a clear roadmap for leveraging data to drive performance and innovation but also establish data governance procedures which prioritise data quality and security.

Crucially, upskilling employees ensures that they are enabled not only with the right procedures but the training required to obtain and leverage these insights, and ask the right questions about their data.

This is especially important in high-impact areas like value creation, investment analysis and operational efficiency. By presenting a clear, evidence-based narrative backed by data, firms can strengthen their equity story and provide the clarity investors need to make decisions.

The goal is to showcase not only past achievements but also a forward-looking roadmap for growth and seamless integration, maximising investor appeal.

2026 is shaping up to be another defining year for PE-backed consolidation in UK accountancy. For mid-tier firms looking to take stock of this opportunity, the recommendation is to act early and invest in the right data foundations, in turn, gaining a competitive advantage while those that stall risk being left behind.

Unlock up to 35% savings on GlobalData reports

Use the code at checkout in the report store

• 20% OFF

  Buy 2 reports

  Use code:

  Bundle20

• 25% OFF

  Buy 3 reports

  Use code:

  Bundle25

• 30% OFF

  Buy 4 reports

  Use code:

  Bundle30

• 35% OFF

  Buy 5+ reports

  Use code:

  Bundle35

Valid on all reports priced $995 and above. Cannot be combined with other offers.

Still deciding what will work best for your business?

Ask our experts for help.

Enquire before buying