March 12, 2026

Australia’s Cross-Border Appeal Fuels Inbound Dealmaking Bonanza - Australia Posts Its Highest Inbound M&A Volume In Over A Decade As A Thriving Mining Sector, Private Capital And Sponsor Buyouts Drive Deals

Aaron Kenavan, Jamie Palmer, John Tivey White & Case LLP + Follow Contact LinkedIn Facebook X Send Embed

Australia’s economic growth is predicted to be solid over the next few years, increasing from 1.8 percent in 2025 to 2.3 percent in 2026 and 2027, according to the OECD. Falling interest rates throughout the spring and summer months, growing household incomes and a resilient labor market all contributed to a steady economic recovery.

Foreign direct investment into the country is booming, with the Australian government continuing to actively encourage investors from overseas. The country’s critical minerals, mining, technology and data center assets are proving hot property among international investors, with the US, EU and UK particularly active. Interest remains high despite the tightening of FDI oversight in 2025, aimed at protecting sectors vital to Australia’s national interest.

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Decade-high deal volume

Strong interest from overseas investors is translating into healthy M&A activity, with international dealmakers seeking out Australia’s high-growth assets at a record pace. A total of 445 deals were announced by overseas bidders over the course of 2025 —the highest annual deal volume in more than a decade.

Inbound deal value, meanwhile, climbed to US$45.8 billion in 2025. This marks a 47 percent increase from the US$31.1 billion spent the previous year, and the highest annual total in the post-pandemic era.

The first nine weeks of 2026 (up to March 9) saw a further 56 cross-border deals into Australia, with a total value of US$5.1 billion.

Energy, mining and utilities (EMU) was the most hotly targeted sector by overseas investors. A total of 76 deals valued at US$18.6 billion changed hands over the course of last year—the highest deal value across all sectors by a sizable margin. In 2026 so far (up to March 9), technology, media and telecommunications (TMT) and business services have seen the most deals, with 12 and 11 transactions, respectively. TMT also tops the value table, with a total of US$2.2 billion, closely followed by construction, with US$1.2 billion.

The EMU sector produced the largest inbound deal in 2025: Singaporean renewable player Sembcorp’s US$4.3 billion acquisition of power generator and retailer Alinta as it continues its expansion across the Asia-Pacific region.

The deal is central to Sembcorp’s expansion plan to grow its renewables capacity to 25 GW by 2028. It gives the Singaporean company access to a 10.4 GW development pipeline, including wind and hydro systems, along with a coal plant in Victoria—Alinta's largest asset.

Australia’s much sought-after mining assets continue to pull in investors from across the globe. In a deal valued at US$3.4 billion, Japan-based trading company Mitsui acquired a 40 percent stake in the Rio Tinto-operated Rhodes Ridge iron ore project. Rhodes Ridge, located in the resource-rich Pilbara region of Western Australia, is said to be one of the largest undeveloped iron ore projects globally, with an estimated 6.8 billion tons of mineral resources.

Another significant deal within the mining sector saw South African mining company Gold Fields acquire an additional 50 percent stake in local miner Gold Road Resources. The US$2.4 billion deal consolidates Gold Fields’ ownership of the Gruyere goldmine in Western Australia.

Soaring gold prices are boosting market confidence, encouraging more acquisitions and pushing up valuations. Australia’s relatively weak dollar is making the sector even more attractive to foreign buyers.

Private capital targets Australian assets

Enhanced private capital and PE interest among international players also looks set to fuel Australian M&A activity over this year and beyond. Alongside local firms, global PE firms—with vast quantities of dry powder—are increasingly targeting Australia’s homegrown assets.

This trend has pushed Australia’s PE activity to a record high, with last year’s total of 56 inbound deals representing the highest figure on record. An annual value of US$12.8 billion, meanwhile, reached a three-year high. Investor appetite is particularly strong in the transport and logistics, energy and digital services sectors. At the time of writing (March 9), there had been six PE deals, totaling US$1.7 billion.

The country’s biggest private capital deal of 2025 was the US$2.7 billion takeover of National Storage by a consortium backed by Brookfield Asset Management and GIC. The transaction was the largest take-private of an Australian real estate company on record. Founded in 1995, National Storage is Australia’s largest self-storage provider, operating more than 270 centers across Australia and New Zealand.

After dropping in value in 2025, the Australian dollar has gained momentum on the back of monetary tightening and a strengthening Chinese yuan, rising to a three-year high in February 2026. While this may make assets more expensive for overseas buyers, this could be good news for current investors seeking to exit deals at a strong return.

Regulatory hurdles

Despite this positive outlook, a rise in interest rates at the start of 2026, strict regulation and pricing mismatches are putting pressure on deals. According to Reuters, more than US$40 billion of deals have collapsed in Australia this year—the highest figure in 15 years. One such high-profile example involving an international bidder was the decision by an ADNOC-led consortium to walk away from its US$18.7 billion bid for gas producer Santos.

The deal would likely have faced reviews from the Australian Competition and Consumer Commission (ACCC), the Foreign Investment Review Board and other government agencies. This burdensome regulatory environment can make it harder for deals to get across the finish line.

New merger controls from the ACCC, which came into effect on January 1, 2026, could add to dealmaker workloads. These changes make pre-approval mandatory for most deals, lengthening the deal process and potentially slowing deal activity.

Yet the reforms could arguably bring more structure and certainty, which may ultimately help deals close more successfully. Rather than deterring transactions outright, the new framework is prompting earlier engagement with regulators, more careful sequencing of deals and a sharper focus on execution risk. However, it will take time to judge the long-term impact of the recent reforms on Australian dealmaking.

Outlook

Inbound M&A activity shows no signs of slowing down as dealmakers look ahead to the remainder of 2026 and beyond. Navigating regulation is something in which global dealmakers are well versed, and the new reforms are unlikely to stop them in their tracks. While dealmakers will need to factor in lengthier timelines and consultations, more structure and certainty surrounding deals may actually help to close deals.

Financial sponsors have been a key driver behind 2025’s record activity and, armed with record amounts of dry powder, they will continue to be active in 2026. While tariff uncertainty and ongoing geopolitical conflict have shaken global markets, Australia’s relatively limited exposure to US goods makes it something of a safe haven for overseas investment.

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