Market Standards Trend Report
Trends in UK Public M&A deals in 2025
Irrevocable undertakings and shareholder activism
Irrevocable undertakings to accept an offer are normally sought by an offeror from significant offeree shareholders immediately before the announcement of a firm offer, so as to secure as much comfort as possible that the offer will be successful. They enable the offeror to show it has substantial support for its offer as soon as it is announced and may also assist the offeror in obtaining the recommendation of the offeree board.
51 out of 56 firm offers listed the percentage of a target’s share capital represented by irrevocable undertakings. 27 (53%) of the 51 firm offers saw bidders receive irrevocable undertakings in respect of at least 20% of the target’s issued share capital (2024: 55%), with bidders on 24 (47%) of the 51 firm offers receiving irrevocable undertakings in respect of 21% or more of the target’s issued share capital (2024: 45%).
Undertakings from non-director shareholders
Non-director shareholders provided bidders with irrevocable undertakings to accept the offer in 35 (63%) of the 56 firm offers announced in 2025 (2024: 65%). Of the 35 firm offers where non-director shareholders provided irrevocable undertakings, 17 (49%) featured hard undertakings only, 13 (37%) featured semi-hard undertakings only, two (6%) featured a soft undertaking only, one (3%) featured both hard and soft undertakings and two (6%) featured both soft and semi-hard undertakings.
Hard undertakings will remain binding if a third party makes a competing offer (even at a higher price), whereas semi-hard undertakings will cease to be binding if a higher competing offer is made at or above a specified price or at a price which exceeds a certain percentage of the original offer price. Soft undertakings cease to be binding if a competing offer emerges at any higher price and have become increasingly rare in recent years.
Photo by Shannon Tremaine on Unsplash
Photo by Shannon Tremaine on Unsplash
Matching or topping rights in irrevocable undertakings
Matching or topping rights in an irrevocable undertaking allow the original bidder a limited period to match or improve on a higher competing offer before the undertaking lapses. Of the 35 firm offers where non-directors provided irrevocable undertakings, seven (20%) featured matching rights.
Shareholder activism
There were a few examples of shareholders actively engaging with target companies in 2025. This engagement took different forms, including publicly encouraging companies to pursue merger transactions, and improving shareholder value of the target companies.
Sparta Capital, an activist shareholder in John Wood Group plc (Wood Group) since 2022, was pressuring the company's board to take stronger action to improve shareholder value due to ongoing share price underperformance, despite operational progress. Sparta highlighted that Wood Group's share price persisted near historic lows (130p–140p), even after a strategic refresh and improvements in operations, which it viewed as unacceptable, especially in the period after Apollo's lapsed takeover offer. Sparta urged Wood Group to conduct a strategic review to explore alternatives to public market listing, such as—a sale of the company; relisting in the US, where similar companies (like Jacobs and KBR) were more highly valued; and leveraging increased M&A activity and strong financing markets. This pressure from Sparta contributed to the takeover by the Dar Al-Handasah trading entity, Sidara, in November 2025. In early 2025 Achilles Investment Company, an activist shareholder in Urban Logistics REIT plc (Urban Logistics) called for significant board changes and a strategic review to improve shareholder value. The group was concerned about Urban Logistics’ persistent discount to net asset value (NAV) and believed immediate steps were needed, including board changes, suspending the planned internalisation, reviewing investment management contracts, implementing a discount control mechanism to keep the share price within 10% of NAV, exploring a potential sale of the company or its assets, amending the articles to prevent issuing shares below NAV, and introducing an annual shareholder vote on the company’s continuation. Urban Logistics was subsequently acquired by LondonMetric Property plc in June 2025.
In early 2025, Achilles Investment Company, an activist shareholder in Urban Logistics REIT plc (Urban Logistics) called for significant board changes and a strategic review to improve shareholder value. The group was concerned about Urban Logistics’ persistent discount to net asset value (NAV) and believed immediate steps were needed, including board changes, suspending the planned internalisation, reviewing investment management contracts, implementing a discount control mechanism to keep the share price within 10% of NAV, exploring a potential sale of the company or its assets, amending the articles to prevent issuing shares below NAV, and introducing an annual shareholder vote on the company’s continuation. Urban Logistics was subsequently acquired by LondonMetric Property plc in June 2025.
"The reluctance of certain institutional investors to give irrevocables has been a well-established trend. Nevertheless, 2025 saw plenty of irrevocables being given. This likely reflects the significant premiums being paid in many of the transactions that convinced shareholders to agree to help lock in deals."
“Increasingly (particularly where a recommendation from a target may be hard to obtain), bidders are looking to stakebuild in target companies before launching a full bid. This strategy, however, requires careful upfront analysis and balancing of the various “pros and cons”, not least potentially being left with an illiquid stake should any offer fail to materialise. Other factors to consider include the ability to block interlopers, Takeover Code complications (including “price-setting”) and the thresholds for, and timing of, public notifications of any share purchases. If executed in the right way, however, potentially in tandem with the obtaining of irrevocables and letters of intent, stakebuilding can significantly boost the chances of a takeover succeeding.”
"Many investment trusts continue to be attractive takeover targets, trading at a significant discount to net asset value, presenting great opportunities for well-financed bidders to subsume portfolios relatively cheaply and unlock synergies. A key issue that we’re encountering on such bids is around the potential conflicts of interest between the target board and the investment manager. Arranging any necessary due diligence access via the investment manager is important - including potential negotiation of the existing investment management agreement (and any transitional/future arrangements), and the assessment of a bidder’s ability to liquidate (or otherwise deal with) the assets."
"A trend that continued to gain momentum in 2025 was the increasing number of investors who are willing to publicly voice opposition, and, in some instances, actively thwart, offers that they think undervalue the target – often in the face of board recommendation(s) and “full and final” offers being tabled by bidders. Activist investors seeking to pressure a bidder to increase its offer (employing so-called “bumpitrage” tactics) have long been a part of the takeover landscape in the UK, with a number of recommended deals, including DBAY’s offer for Alliance Pharma, and Fortress’ offer for Loungers, requiring the initial offer to be increased before shareholder support was won. More uniquely, this is the first time in many years (since Ramsay Healthcare’s offer for Spire was voted down in 2021) where we have seen a couple of recommended offers lapse for failure to obtain the requisite shareholder approval at the relevant scheme meetings (Natra Global’s (a company owned by Exponent Private Equity) offer for Treatt and most recently, TT Electronics’ recommended offer by Cicor). Again, bidders (and targets) will need to be nimble and well-advised to deal with such situations."