EMEA corporate acquisition financing is on the rebound after an underwhelming 2025 as corporate strategic consolidation continues across sectors despite ongoing challenges from tariffs, geopolitical uncertainty, regulatory complexity and valuation gaps.

The region lags the US market, where appetite for dealmaking has been strong for some time and banks remain keen to supply bridge loans or funded term loans at scale to back acquisitions.

“Over the past six months you’ve seen a real explosion of event-driven activity in the US, and the US tends to be six months ahead of Europe in the cycle, so we can expect more activity this year,” a senior banker said.

Tariffs had a stifling effect on M&A last year, reducing profit margins and disrupting supply chains to hit valuations, which saw many deals stall or even cancelled.

“Last year, 'liberation day' set people on the back foot with respect to some of the strategic initiatives they had, and that had a corresponding effect on acquisition financing,” the banker said.

While tariffs can negatively impact M&A activity, they can also drive strategic consolidation, encouraging firms to acquire domestic companies to avoid import duties.

Tariffs remain in play as the US moves to a temporary 10% global rate after a Supreme Court ruling on February 20, but there are growing indications that banks and borrowers are coming to accept the persisting volatility.

Borouge tonic 

The successful closing of Borouge Group International’s US$15.4bn debt financing in late 2025, backing its US$13.4bn acquisition of North American polyethylene producer Nova Chemicals Corp, raised hopes of a serious uptick in dealmaking in 2026.

That financing comprised a US$9.4bn one-year bridge loan, a US$1.5bn three-year term loan, a US$1.5bn five-year term loan and a US$3bn five-year revolving credit facility.

Barclays, Citigroup, First Abu Dhabi Bank and UniCredit underwrote and led the financing, successfully syndicating the facilities to a further group of 26 banks, reflecting strong appetite for event-driven deals.

Already, several jumbo financings have been placed backing big ticket acquisitions in 2026.

Global asset manager Nuveen is backing its £9.9bn recommended cash acquisition of London-listed Schroders with a £3.1bn delayed draw term loan.

The financing comprises an £800m 364-day facility, an £800m two-year facility and a £1.5bn three-year facility. BNP Paribas is administrative agent, sole lead arranger and sole bookrunner on the financing.

The acquisition will also be financed with existing cash from Nuveen’s parent Teachers Insurance and Annuity Association of America.

The combined group will have nearly US$2.5trn of assets under management balanced across institutional and wealth channels.

The acquisition is expected to close in the fourth quarter of 2026.

Deutsche Boerse is backing its €5.3bn acquisition of Amsterdam-listed fund trading platform Allfunds with a €3.6bn bridge loan from Barclays and BNP Paribas.

The acquisition will unite Allfunds’ fund distribution platform with Clearstream Fund Services, strengthening the group's position in the high-growth, fee-generating fund distribution market.

The acquisition is expected to close in the first half of 2027.

German container shipping company Hapag-Lloyd has lined up an up to US$2.5bn bridge financing to back its around US$4.2bn acquisition of Israel’s Zim Integrated Shipping Services.

Bank of America is sole underwriter on the financing. The bridge provides additional liquidity headroom for the acquisition, which will be financed from Hapag-Lloyd’s cash reserves.

The merger with Zim would cement Hapag-Lloyd’s position as the world’s fifth largest shipping line with a fleet of over 400 vessels.

The acquisition is expected to complete by the end of 2026.

Border crossing

Spanish water and renewable energy company Grupo Cox backed its US$4.2bn acquisition of Iberdrola’s assets in Mexico with a US$2.65bn acquisition financing.

The two-year bridge loan agreed in January is being provided by a syndicate of seven banks comprising Citigroup, Barclays, BBVA, Deutsche Bank, Goldman Sachs, Santander and Scotiabank.

Meanwhile, syndication closed on the US$2bn loan backing UK-headquartered Harbour Energy’s US$3.2bn acquisition of US-based LLOG Exploration Co, which completed on February 11.

That financing includes a US$1bn one-year bridge loan with two six-month extension options and a US$1bn three-year bullet term loan.

DNB and JP Morgan underwrote the financing as bookrunners together with Bank of America, Barclays, Citigroup, Deutsche Bank, HSBC, ING, Lloyds Bank, Morgan Stanley, Natixis, Standard Chartered, SMBC and Wells Fargo as mandated lead arrangers.

Banco Sabadell, China Construction Bank, Macquarie Bank, Mizuho Bank and Royal Bank of Canada also participated.

US-based Worthington Steel lined up a €1.603bn-equivalent bridge loan in January to back its US$2.4bn acquisition of German metals processor Kloeckner & Co.

That 364-day bridge loan is initially being provided by Wells Fargo and Citigroup. The takeover is expected to complete in the second half of 2026.

The pipeline continues to build.

Zurich Insurance will fund its proposed £8bn acquisition of UK specialist insurance broker Beazley Group with existing cash and new debt facilities as well as an equity placing.

The acquisition would create a global leader in specialty insurance with around US$15bn of gross written premiums.

French utility Engie is also lining up debt to finance its £10.5bn acquisition of UK Power Networks, while Dubai Aerospace Enterprise will back its around US$7bn all-cash acquisition of Macquarie AirFinance with a combination of debt and equity.

Source: IFR