UK manufacturers are preparing for a wave of mergers and acquisition (M&A) activity in 2026 and fresh investment in skills, according to a new report by specialist business advisory firm
FRP.
Of the manufacturing senior decision makers polled for FRP’s new report
The Manufacturing Agenda, nearly a third (30%) said they expect their boards to be leading acquisitive buy-side M&A over the next 12 months, while a similar proportion said they expect their boards to be leading sell-side activity (29%). Skills and talent feature prominently, with 29% expecting board-level action and 40% planning increased investment in this area.
This follows a year where manufacturers say their boards have been focused on managing ongoing structural challenges, such as ESG regulation (26%), geopolitical friction or trade change (25%), supply chain disruption (24%) and margin squeezes or unplanned cost spikes (24%). As well as skills, firms are also prioritising fresh investments in their sustainability, ESG compliance or decarbonisation efforts (40%) or to support succession planning (40%) in the year ahead.
Lenders and investors shared different 2026 focus areas as boards. When asked what would prompt them to intervene in a portfolio company over the next 12 months, lenders and investors cited cost, cashflow and working capital (44%), investment, automation and digital execution (41%) and leadership resilience (37%).
Tom Cox, debt advisory partner at FRP, said: “These results reflect a sector that is redefining resilience. Iti s no longer just about financial strength – it is about making strategic investments when they matter most, and having the resources and support to adapt at pace.
"While there are some areas of alignment between the priorities of boards and lenders, there are significant gaps. This matters because a misalignment in perspectives could be limiting access to the funding manufacturers need for their growth and M&A plans. Firms that take time to understand lenders’ priorities – and communicate their strategy in those terms – will be best positioned to secure the backing they need to keep building their resilience over the year ahead.”