UK Infrastructure Services M&A has delivered its strongest year in over five years in 2025, standing out amid broader mid-market softness. This surge is being driven by record funding levels, energy transition programmes, and tightening environmental regulation, signalling a structural shift in investor priorities.
According to Andrew Dickinson, Head of Infrastructure Services at Heligan Group, “Visibility of earnings and workload is central to investor confidence. From AMP8 to energy transition to environmental reform, the UK is entering a sustained period of infrastructure modernisation. We expect consolidation to accelerate as investors seek scale, technical depth, and exposure to regulated end markets.”
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UK Infrastructure Services M&A delivers strongest year in over five years in 2025, with funding mobilisations translating into renewed confidence
Sector entering a new phase of consolidation driven by record funding levels, energy transition and tightening environmental regulation, according to new Heligan report
UK Infrastructure Services M&A delivered its strongest year in more than five years in 2025, with 278 transactions completed, an outlier in contrast to broader volumes across the lower mid-market in the UK, which is generally down. The Infrastructure Services sector is entering a new phase of structurally driven consolidation as record levels of committed funding pots, energy transition programmes and tightening environmental regulation reshape investor priorities. This is according to Heligan Group’s latest 2025 review: UK Infrastructure Services M&A report.
The report finds that while deal activity moderated across the wider market at the start of 2025 amid broader macroeconomic caution, underlying sector fundamentals meant deal activity across Infrastructure Services remained robust. Long-term capital commitments across water, power, environmental services and digital infrastructure continue to provide strong workload visibility for contractors, engineering specialists and compliance-led platforms.
“The UK infrastructure services market is being driven by structural investment themes rather than cyclical momentum,” says Andrew Dickinson, Head of Infrastructure Services at Heligan Group. “AMP8 mobilisation, grid reinforcement, decarbonisation mandates and water network resilience are generating sustained demand across multiple sub-sectors. Buyers are focused on businesses that can demonstrate regulatory alignment, technical capability and scalable delivery models.”
The report highlights AMP8 as a defining catalyst for M&A activity over the coming years. Record investment allocations across water and wastewater are accelerating demand for specialist engineering, environmental compliance, asset optimisation and maintenance providers. As frameworks are mobilised, mid-market operators with strong regional footprints and technical differentiation are expected to attract heightened interest from both strategic acquirers and financial sponsors.
Energy transition is also emerging as a core consolidation theme. Grid upgrades, renewable integration, battery storage and network modernisation are driving acquisition appetite for power engineering, connection services and specialist contracting platforms. Investors are increasingly targeting businesses positioned at critical points in the value chain, particularly those with exposure to regulated asset owners and long-term infrastructure programmes.
Environmental enforcement reform and enhanced regulatory scrutiny are further strengthening demand for compliance-led services. Stricter oversight across water quality, environmental monitoring and building safety is raising barriers to entry while reinforcing the strategic importance of specialist operators. This dynamic is supporting premium valuations for testing, inspection, certification and environmental services businesses with defensible market positions.
Technology capability continues to differentiate assets in competitive processes. Businesses embedding digital twins, advanced BIM workflows, AI-enabled asset management and drone surveying are attracting significant buyer attention as infrastructure owners seek efficiency, resilience and data-led decision-making. As digital tools transition from innovation to operational necessity, Heligan expects further consolidation among digitally enabled service providers.
Whilst these sub-sectors saw growth in 2025, growth was clustered across the Infrastructure Services sector. Traditional construction activity slowed, as clients voiced frustrations with continued orderbook mobilisation delays. Despite this softening in 2025, the construction and civils subsector is heading for a busier 2026, with more projects moving on site across the UK.
Private equity remains an active force across the sector, particularly through platform led buy-and-build strategies targeting fragmented sub-sectors such as environmental services, specialist engineering and compliance platforms. International capital continues to view the UK as an attractive destination given its regulatory transparency, structured funding cycles and long-dated infrastructure commitments.
Dickinson concluded: “Visibility of earnings and workload is central to investor confidence. The current funding and policy landscape provides that visibility. From AMP8 to energy transition to environmental reform, the UK is entering a sustained period of infrastructure modernisation. We expect consolidation to accelerate as investors seek scale, technical depth and exposure to regulated end markets.
“Although short-term transaction volumes may fluctuate in line with broader market conditions, the strategic drivers underpinning UK Infrastructure Services M&A remain firmly intact. With capital deployment across water, power and environmental infrastructure set to intensify through to 2030, the sector is positioned for continued deal activity as buyers compete for high-quality, platform-scale assets.”
Heligan Group is an intelligence-led investment and advisory group specialising in partnering with businesses that contribute to global safety and security. With a growing presence across various geographies, Heligan Group stands as a leader in its field, combining expertise with innovation.
Benjamin Hart / Avinash Nandra / Sabihah Choudhury
