UK M&A Data for H1 2026: What It Means If You're Thinking About Selling Your Agency

Dealsuite publishes its UK&I M&A Monitor twice a year, drawing on survey responses from M&A advisory firms active in the £1 million to £200 million mid-market. The August 2026 edition (Edition 13) surveyed 437 firms and received 102 detailed responses, a 23% response rate.

I was one of the advisors quoted in this edition, in the Outlook section. Before I get to that, it's worth walking through what the data actually shows, because most of it is directly relevant if you own a creative or marketing services agency and are weighing up an exit.

One caveat up front: this report does not track "creative agencies" as a separate sector. The closest proxies in Dealsuite's sector list are Business Services and Media & Communication. I've used those two categories below where sector detail matters, and I've said so each time, rather than presenting broader mid-market figures as if they were agency-specific.

Deal volume is holding, but the mix has shifted toward bigger deals

38% of advisors reported an increase in completed transactions in H1 2026 compared with H2 2025 (6% strongly increased, 32% increased). 45% saw no real change, and 17% reported a decrease. That's a market that's ticking along rather than booming.

What's changed more noticeably is deal size.

Transactions above £10 million rose from 15% to 19% of completed deals, a four percentage point increase. The £7.5 million to £10 million band grew by the same margin, from 7% to 11%. At the other end, deals below £2.5 million fell sharply, from 42% to 32% of the total. The £5 million to £7.5 million band was unchanged.

Read together, this points to larger, better-prepared businesses transacting more readily than smaller ones. That's consistent with what I see day to day: the gap between an agency that's ready for sale and one that isn't has become more decisive in a market where buyers can afford to be selective.

For the sub-£5m agency, there are still opportunities, albeit the volume waned by a combined eight per cent in the report. Perhaps it's time to buy not sell?

What the multiples say for Business Services and Media & Communication

The average EBITDA multiple across all sectors tracked was 5.4, unchanged from H2 2025. Business Services, the broadest proxy for many agency business models in this report, posted the largest gain of any sector: up 0.3 to 6.3. It also held the top spot, for the third consecutive edition, as the sector advisors expect to see the most growth in deal activity in H2 2026. Media & Communication moved more modestly, from 4.3 to 4.5.

Business Services feels like a natural home for agencies, but it's easy to get wooed by the headline numbers without digging into the detail. My observation is that most of the business services listed in this category on Dealsuite are not agencies. They tend to be cleaning, maintenance and other services. It doesn't mean the numbers are irrelevant, but it does point us more towards media and communication.

Software Development, by contrast, flipped from an expected riser to an expected decliner. Advisors quoted in the report put this down to buyer caution around AI's effect on which software business models will still be defensible. It's a reminder that being adjacent to AI disruption cuts both ways: it can depress buyer appetite for businesses whose model AI threatens, and it can sharpen appetite for businesses that use AI well. I'll come back to that point.

I've seen a very wide range of multiples across H1 from 2.5x all the way up to 8.5x. The devil, as always, is in the detail

Size still moves the needle more than sector

The report's Small Firm Premium data is the single most useful chart for smaller agency owners. It shows the average EBITDA multiple paid at different company sizes: 3.6x at £200,000 EBITDA, 4.2x at £500,000, 4.9x at £1 million, 5.7x at £2 million, 6.8x at £5 million, and 8.2x at £10 million. That's a gap of 4.6x in multiple between the smallest and largest brackets, on top of the underlying difference in EBITDA itself.

In plain terms: growing your EBITDA before you sell doesn't just increase the number you multiply, it increases the multiple you're applying to it. Both move in your favour at once. This is the strongest argument I know for building value deliberately in the years before a sale, rather than going to market as soon as the idea occurs to you.

Earlier suggested the case for buying not selling? Buying another agency is often a faster way to scale than relying on organic alone.

Half of all sale processes hit a valuation gap, and a quarter of those break down

This edition asked advisors directly, for the first time, how often seller expectations diverge from realistic market value. The answer: 49% of transaction processes see the seller's valuation perceived as too high. Where that happens, the average deviation from realistic market value is 23%, and in 24% of those cases the gap ultimately breaks the deal.

That's a material proportion of the market losing deals not because the business isn't sellable, but because the owner's expectation and the market's assessment don't match closely enough to bridge. An independent, evidence-based view of what your agency is actually worth, taken well before you go to market, is the most direct way to avoid becoming part of that 24%.

Buyer appetite is up

The average number of seriously interested parties per company sale rose to 8.5 in H1 2026, up from 7.9 in H1 2025. Business Services companies attracted 10.7 interested parties on average, among the highest of any sector, though slightly down from 11.1 the year before. More buyers competing for a well-prepared asset is, unsurprisingly, good news for sellers who've done the preparation.

Sentiment is holding at a high level

76% of advisors assessed H1 2026 positively overall (4% very positive, 21% positive, 51% slightly positive). Looking ahead, 80% describe themselves as optimistic about H2 2026, essentially unchanged from the 81% recorded for H1 2026 in the prior edition. Confidence has settled at a high level rather than swinging from one half-year to the next.

My own read, from the buy-side

Here's the quote I gave Dealsuite for this edition, on the buy-side view:

"On the buy-side, I think there are lots of reasons to take an opportunistic approach in the year ahead. We have a generation of owners who want to transition their businesses into new ownership. Even in normal times, the sheer number of these transitions would make M&A an exciting place to be. But I see those transitions being accelerated by the realities of AI-led transformation (or lack of it) and volatile trading conditions that make holding out for another three years unattractive."

The data in this report backs that up from a few angles. A large cohort of agency owners are approaching a natural point of transition. AI is already reshaping which business models buyers trust, as the shift in Software Development sentiment shows; agencies that can demonstrate they've adapted, rather than merely adopted a few tools, will be treated differently by buyers than agencies that haven't. And with 49% of sale processes running into a valuation gap, owners who wait for a "better time" without doing the preparation work often find the gap between their expectation and the market hasn't closed. It's grown, because someone else's better-prepared business set the new benchmark.

If you're weighing up a sale, or wondering whether your agency's current valuation matches what you'd hope to achieve, the two questions worth answering first are simple: what is the business actually worth today, on the market's terms rather than yours, and what would change that answer if you waited three years instead of going now.

Source: Dealsuite Research, "M&A Monitor UK&I: Data & Trends in the UK&I SME M&A Market," August 2026, Edition 13. Survey of 437 M&A advisory firms, 102 responses (23% response rate).