Kearney Report Signals Chemicals M&A Rebound

Kearney's 2026 Chemicals Executive M&A Report shows global deal value rose 18% in 2025 to surpass the seven-year average, but this rebound was driven by just four mega-transactions—Borealis-Borouge, AkzoNobel-Axalta, OMV/ADNOC's Nova Chemicals acquisition, and Berkshire Hathaway's OxyChem deal—that accounted for 40% of total activity, while non-mega deals grew only 4%.

Executives anticipate active but selective M&A in 2026 amid structural profitability pressures like overcapacity, weak end-market demand, pricing erosion, and China oversupply, rather than financing constraints, leading large corporates to accelerate divestments of non-core assets and financial sponsors to target underperforming assets with clear operational fixes.

Regional divergence deepens: North America favors carve-outs with foreign strategic buyers; Europe sees restructuring from high costs driving portfolio exits to PE; Asia remains domestically led amid oversupply; and the Middle East emerges as both scale-capital source and carve-out market, with value creation shifting to execution over multiple expansion.