Canada's Middle Market M&A Update and Industry Reports
Canada's Middle Market M&A Update – Q2 2025
Canada's economy demonstrated resilience in Q2 2025 despite persistent uncertainty surrounding U.S. tariffs and geopolitical risks, leading the Bank of Canada to hold interest rates steady after multiple cuts. M&A activity moderately declined as buyers adopted a cautious approach amid mixed economic signals, tariff-related trade disruptions, and uncertainty regarding the timing of future interest rate cuts.
- Interest rate pause amid economic resilience: The Bank of Canada maintained its key interest rate at 2.75% in Q2 2025 following seven consecutive cuts, balancing ongoing U.S. tariff uncertainty with signs of Canadian economic deceleration and underlying strength.
- Moderate decline in M&A activity: M&A transactions declined by 6.0% quarter-over-quarter, decreasing from 249 in Q1 2025 to 234 in Q2 2025. The Industrials and Information Technology sectors accounted for 43% of deals, with 62 and 39 transactions, respectively
- Mixed economic indicators: The S&P/TSX Composite Index gained 7.3% in Q2 2025, led by the Information Technology and Consumer Discretionary sectors, while the Canadian dollar strengthened against the USD. Unemployment increased to 6.9%, inflation growth slowed due to tax changes, and housing starts surged but are expected to slow. The Canadian economy remained flat in Q2 2025 on a quarter-over-quarter basis amid export declines linked to tariff disruptions.
Quarterly Industry Reports Q2 2025
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Brett Franklin CPA, CA
President, MNP Corporate Finance
Brett Franklin, CPA, CA, is President, MNP Corporate Finance Inc. Based in Winnipeg, Brett develops and implements creative business strategies for clients in all industry sectors and in all stages of the business life cycle.
Brett’s primary role is facilitating the sale of companies, but he also provides support with business acquisitions, corporate restructuring and transactional due diligence.
With a diverse background in financial services, including banking, private equity, hedge funds and structured investment products, Brett has the knowledge and ability to resolve challenging financial issues and develop practical solutions to even the most difficult problems. He is adept at guiding clients at any level of the organization, helping them understand complex situations and providing professional business strategy advice.
Prior to joining MNP, Brett was Director of Hedge Fund Administration at UBS AG in the Cayman Islands. He holds the Chartered Professional Accountant (CPA) designation, qualifying as a Chartered Accountant (CA) in 2001, and a Master of Accountancy degree from the University of Manitoba. In his free time, Brett coaches minor hockey and baseball.