Canadian Mid-Market
In Q1 2026, the Bank of Canada (BoC) held its overnight rate at 2.25%. At the January 2026 meeting, the BoC indicated that the outlook for the Canadian economy remained broadly in line with the projections outlined in the October 2025 Monetary Policy Report. However, the macroeconomic backdrop had evolved by the March 2026 policy meeting, as escalating geopolitical tensions in the Middle East drove a sharp increase in oil prices. This rise in energy costs added to inflationary pressures, reinforcing expectations that Consumer Price Index (CPI) inflation will remain above the BoC’s 2.0% target through 2026. Conversely, Gross Domestic Product (GDP) growth contracted 0.6% in Q4 2025. The BoC held its position to maintain the overnight rate at 2.25% to balance cooling domestic growth with inflationary risks from increasing energy prices, geopolitical instability, and continued uncertainty over United States (U.S.) tariff policies.
M&A activity in Q1 2026 increased 10.0% quarter-over-quarter (QoQ), with the number of transactions increasing from 251 in Q4 2025 to 276 in Q1 2026. Overall investor sentiment remained subdued but showed early signs of stabilization as market participants continued to adjust to evolving U.S. trade policy and a lower interest rate environment. M&A activity is expected to accelerate through 2026, supported by strategic, accretive acquisitions by industry participants and increasing pressure on private equity firms to deploy significant levels of dry powder.
The above chart summarizes transaction count by sector in Q1 2026 and select sector highlights are noted below:
276
Transactions
Energy 09
Consumer Staples 10
Utilities 04
Materials 37
Industrials 76
Financials 33
Information Technology 61
Communication Services 09
Consumer Discretionary 21
Healthcare 16
Q1 2026 Transaction Count by Sector
The Information Technology sector followed with 61 transactions, accounting for 22.1% of total transactions in Q1 2026. A notable transaction within the Information Technology sector was Repay Holdings Corporation’s acquisition of Kubra Data Transfer Ltd. at an implied EV of $518.0 million.
The Industrials sector led the quarter with 76 transactions, accounting for 27.5% of total transactions in Q1 2026. A notable transaction within the Industrials sector was Birch Hill Equity Partners’ acquisition of Velan Inc. at an implied Enterprise Value (EV) of $282.1 million.
The Financials sector recorded 33 transactions in Q1 2026, representing 12.0% of the total transaction count in the quarter. A notable transaction within the Financials sector was Wawanesa Mutual Insurance Company’s acquisition of Everest Insurance Company of Canada at an implied EV of $410.0 million.
Quarterly Transaction Count
Transaction Count
Equity Markets
Canadian Mid-Market
Select M&A Transactions
Equity Markets
Canadian Economic Update
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The S&P/TSX Composite Index (TSX) gained 2.8% in Q1 2026, with 5 out of 10 sectors generating positive returns.
The Materials sector recorded a gain of 10.2% in Q1 2026, outperforming the broader market. Forty-five of the 60 constituents posted positive quarterly returns, led by 5N Plus Inc., which achieved a 78.8% increase in share price during the quarter.
The Utilities sector experienced the second-best performance in Q1 2026, increasing 9.8%. Thirteen of the 14 constituents posted positive quarterly returns. The sector was led by Boralex Inc., Northland Power Inc., and Brookfield Renewable Partners L.P.
The Industrials sector experienced a modest decline of 1.3% in Q1 2026, despite 16 of 29 constituents delivering positive price returns. The sector was led by Bird Construction Inc., Aecon Group Inc., and MDA Space Ltd., which posted gains of 39.7%, 33.7%, and 32.3%, respectively.
The Information Technology sector declined by 18.8% in Q1 2026, experiencing the worst performance of the quarter with all 10 constituents posting negative returns. Celestica Inc. was the best performer, declining by only 3.4%.
Q1 2026 Sector Performance
Materials
10.2 %
Utilities
9.8%
Consumer Staples
2.0%
Energy
4.9%
Communication Services
5.5%
Financials
(3.3%)
Industrials
(1.3%)
Consumer Discretionary
(2.8%)
Information Technology
(18.8%)
Healthcare
(7.8%)
Wawanesa Mutual Insurance Company (Wawanesa)
Repay Holdings Corporation (REPAY)
Birch Hill Equity Partners (Birch Hill)
is acquiring
Announced March 23, 2026
Implied EV $410.0M
EV/EBITDA Not Disclosed
EV/Revenue Not Disclosed
Wawanesa Mutual Insurance Company (Wawanesa) is a major mutual insurer offering property, casualty, life, and other insurance products to over 1.9 million members. Wawanesa earns over $4.0 billion in annual revenue and holds $11.5 billion in assets. The company has more than 3,600 employees across Canada. Founded in 1896, Wawanesa is based in Winnipeg, Manitoba.
Everest Insurance Company of Canada (Everest Canada) is the Canadian retail insurance arm of Everest Group Ltd. Everest Canada is a specialty insurer, with an extensive portfolio of commercial insurance products, including cyber, accident and health, aviation, marine, professional liability, and property and casualty insurance. Founded in 1992, Everest Canada is based in Toronto, Ontario.
The acquisition of Everest Canada will diversify Wawanesa’s current offerings and support the company’s growth in the commercial insurance segment. This acquisition is expected to add $305.0 million in annual revenue to Wawanesa’s commercial lines portfolio.
is acquiring
Announced March 30, 2026
Implied EV $518.0M
EV/EBITDA Not Disclosed
EV/Revenue Not Disclosed
Repay Holdings Corporation (REPAY) is a leading provider of integrated payment processing solutions. REPAY has over 602,000 suppliers enrolled in its platform and earns over $300.0 million in annual card payment revenue. REPAY serves clients across the automotive, healthcare, business-to-business, and personal lending industries. Founded in 2006, REPAY is based in Atlanta, Georgia.
Kubra Data Transfer Ltd. (KUBRA) is a provider of bill payment and customer communication management solutions. KUBRA’s clients include some of the largest utility and government entities, with services touching over 40% of Canadian and U.S. households. Founded in 1992, KUBRA is based in Mississauga, Ontario.
The acquisition facilitates REPAY’s expansion into the utilities, government, and insurance sectors. REPAY’s extensive payment expertise and technology platform paired with KUBRA’s partnerships and distribution channels is expected to generate significant scale across diverse growth markets.
is acquiring
Announced January 14, 2026
Implied EV $282.1M
EV/EBITDA 10.2x
EV/Revenue 0.7x
Birch Hill Equity Partners (Birch Hill) is a private equity firm seeking investments in growth-oriented, mid-market businesses. Since the firm’s inception, Birch Hill has made 74 investments and currently has over $6.0 billion in capital under management. Founded in 1994, Birch Hill is based in Toronto, Ontario.
Velan Inc. (Velan) is a leading manufacturer of industrial valves, serving customers globally. The company has manufacturing plants in nine countries operated by approximately 1,200 employees. Velan’s portfolio includes hundreds of patented solutions developed for critical applications across several industrial sectors, such as nuclear power, mining, and the oil and gas industry. Founded in 1950, Velan is based in Montreal, Quebec.
The acquisition will provide Velan with the necessary capital and strategic support to achieve its long-term growth plans and strengthen its competitive presence internationally.
S&P/TSX Composite Index (^GSPTSE) - Index Value
2.78%
About MNP Corporate Finance
In Q1 2026, the Canadian Dollar (CAD) weakened modestly against the U.S. Dollar (USD), ending the quarter at 1.39 CAD/USD compared to 1.37 CAD/USD at the close of Q4 2025. This was mainly due to the relative strength of the U.S. economy and the interest rate differential.
Full-year 2025 real GDP growth came in at 1.7%, marking the slowest pace of expansion since the COVID-19 pandemic, largely attributable to headwinds related to U.S. trade policy. Early indicators point to a modest rebound in Q1 2026.
Annualized housing starts in Q1 2026 were estimated at 242,000 units, down slightly from 255,000 units in Q4 2025. The decline reflects continued weakness in the real estate sector, with housing activity expected to soften further in 2026.
In Q1 2026, CPI remained above the BoC’s 2.0% target, reaching an average of 2.2%. The main contributor to the elevated CPI were gasoline prices, which surged 21.2% month-over-month in March 2026, due to the supply shock resulting from the conflict in the Middle East.
The average unemployment rate decreased to 6.6% in Q1 2026 from 6.7% in Q4 2025, even as total employment declined by 95,000 over the quarter. This is driven by increased retirements and a more restrictive federal immigration stance, reducing the number of individuals in the labour market.
CAD/USD Exchange Rate
CAD Per USD
Historical
Forecast
1.35
Note: TD forecasts a Q2’26 CAD/USD exchange rate of 1.35.
2026F
2.25%
2025
2.25%
Year
Canada
Overnight Rate
(%)
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Canadian Economic Update
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From Coast to Coast
Hands-on Approach
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Local & International Reach
Integrated Service Offering
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From Coast to Coast
MNP Corporate Finance (MNPCF) has a dedicated team of over 100 M&A, capital markets, and due diligence professionals across Canada. MNPCF works with clients in virtually all industries as they prepare, plan, and execute transactions. Our typical transactions range in value between $3 million and $300 million.
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Hands-on Approach
Current M&A transactions require a hands-on approach from start to finish including the active engagement of senior resources. Our senior resources are dedicated to our clients and are available as necessary and appropriate. We keep our clients regularly informed of the engagement status, issues we are encountering, successes, and overall progress.
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Local & International Reach
MNP is a participating firm within Praxity, a unique global alliance of independent accounting/advisory firms created to answer global business needs. As a member of Praxity, we are able to offer access to corporate finance, accounting, and tax advisory services worldwide.
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Integrated Service Offering
We draw on the vast experience and deep specialist knowledge network of our partners locally, nationally, and internationally as specialty issues arise, such as pre-transaction tax planning, transaction structuring, estate planning, valuation, due diligence, performance improvement, and risk management.
MNP Corporate Finance is a leader in providing transaction advisory services, including divestitures, financing, due diligence and acquisitions. With offices strategically located across Canada, we have the experience and expertise organizations need to take advantage of emerging opportunities in the national and global marketplace.
350+
Closed transactions (last 10 years)*
6B+
Total enterprise value (last 10 years)*
Helping clients prepare, plan & execute transactions
Food & Beverage
Retail & Distribution
Manufacturing
Agriculture
Transportation
Construction
Software
Financial Services
Materials
Healthcare
Pharmaceutical
Technology
Energy
Oilfield Services
Real Estate
Automotive
Industry Experience
Quarterly Industry Reports Q1 2026
Agriculture
Dealerships
Engineering & Construction
Food & Beverage
Healthcare Services
Manufacturing
Oilfield Services
Technology
* Data Sources are listed in the downloadable report
Divestitures
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Acquisitions
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Financing
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Due Diligence
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Transaction Advisory Services
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Learn more about our services
View our transactions
*Does not include due diligence engagements
Select Q1 2026 M&A Transactions - Canada
Sector
Return
1.39
Q2'25
Q3'25
Q4'25 Q1'26
2.75%
2.50%
2.25%
2.25%
2026F
1.1%
Q2'25
Q3'25
Q4'25 Q1'26F
(0.9%)
2.4%
(0.6%)
2.0%
2025
1.7%
Year
Canada
Real GDP Growth (QoQ % change)
2026F
6.6%
Q2'25
Q3'25
Q4'25 Q1'26
6.9%
7.0%
6.7%
6.6%
2025
6.8%
Year
Canada
Unemployment Rate (%)
2026F
242
Q2'25
Q3'25
Q4'25 Q1'26
282
273
255
242
2025
258
Year
Canada
Housing Starts ('000s)
2026F
2.5%
Q2'25
Q3'25
Q4'25 Q1'26
1.8%
2.0%
2.2%
2.2%
2025
2.1%
Year
Canada
Consumer Price Index (YoY % change)
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