Feb
2026
Executive Summary
The chemicals and materials sector enters 2026 in a disciplined but opportunity-rich environment. After a muted 2025 marked by soft demand, tariffs and elevated interest rates, transaction activity remains selective, but strategic momentum is building. Advanced materials, construction chemicals, life sciences and water treatment continue to attract strong buyer interest, particularly where businesses demonstrate defensible technology, durable margins and exposure to resilient end markets. A substantial backlog of sponsor-owned assets, combined with ongoing portfolio rationalization, is positioning the market for increased activity as macro conditions improve.
Positioning for 2026
High-quality assets tied to defense, electronics, battery materials and water infrastructure are commanding attention, while disciplined buyers capitalize on valuation resets in more challenged segments. Companies best positioned for success will:
- Focus on resilient, innovation-driven end markets
- Refine portfolios through carve-outs and strategic realignment
- Strengthen durable profitability through pricing discipline and operational execution
- Elevate asset quality and strategic clarity in a market defined by scarcity and selectivity
Access the Full Report
Download the full Chemicals and Materials M&A Recap & 2026 Outlook to explore sector valuations, sponsor backlog dynamics and the trends shaping transaction activity in 2026.