Tomassetti says this wave of public and private capital is expected to drive M&A across infrastructure, energy, critical minerals, defence and housing as investors seek scale, capabilities and capacity. Accelerating investment in AI‑enabled digital infrastructure – from data centres and cloud capacity to power and connectivity – will also spur spin‑off deals as companies position along the AI value chain.
“Companies operating in construction and engineering, building materials and logistics, oil and gas services, advanced manufacturing and robotics and business services will see consolidation this year as firms in these sectors seek capabilities and capacity expansion to service demand,” Tomassetti says. “This Canada‑first investment agenda combined with both favourable macroeconomic conditions for deals will create a dynamic environment for M&A.”
Domestic dealmaking and succession‑led activity
KPMG also expects 2026 to be a strong year for domestic transactions as Canada pursues a more competitive and self‑sufficient economic agenda. “Canada’s economic agenda is creating a pipeline of opportunity for domestic dealmakers that demands scale and sophistication,” says Neil Blair, Partner and National Leader of KPMG Canada’s Deal Advisory practice. Investments in infrastructure, energy, critical minerals and business services will require bigger companies to execute complex projects, he says.
“This dynamic will make smaller, specialised firms highly attractive acquisition targets, while pushing larger players to scale up to meet the demands of major projects,” Blair adds. “This is in addition to continued succession‑led M&A and significant dry powder sitting with private equity funds and family offices across North America.”
Blair says buyers and sellers that can identify the right opportunities at the right time and act with confidence will benefit most. “For buyers, timing is critical,” he says. “In a competitive market, disciplined dealmakers look beyond short‑term fluctuations and focus on fundamentals – strong leadership, clear growth trajectories, and operational resilience.” Sellers, he adds, should focus on preparation and momentum rather than trying to time the peak, because “buyers pay a premium for businesses that are performing well and still have room to grow.”