Canadian Mid-Market
In Q4 2025, the Bank of Canada (BoC) held two policy meetings. In the first meeting, held on October 29, the BoC lowered the overnight rate by 25 basis points (bps) to 2.25%, citing the impact of the United States (U.S.) tariff policies on exports and business investment, as well as a softening labour market. In the second meeting, held on December 10, the BoC held the overnight rate at 2.25%, pointing to stronger-than-expected Q3 2025 Gross Domestic Product (GDP) growth, alongside improving employment conditions, with the national unemployment rate decreasing to 6.5% in November 2025. The BoC projects GDP growth of 1.1% in 2026 and 1.5% in 2027. Consumer Price Index (CPI) inflation is expected to remain at approximately 2.0% over the forecast horizon. If economic conditions remain in line with these projections, the BoC considers the current overnight rate appropriate, with no further reductions expected in the near term.
M&A activity in Q4 2025 declined 12.5% quarter-over-quarter (QoQ), with the number of transactions decreasing from 273 in Q3 2025 to 239 in Q4 2025. Despite a decrease in interest rates during Q4 2025, M&A sentiment remained muted due to macroeconomic uncertainty stemming from the unpredictability of U.S. trade policy. M&A activity is expected to accelerate in 2026, supported by accretive acquisitions by industry participants and mounting pressure on private equity firms to deploy substantial cash reserves.
The above chart summarizes transaction count by sector in Q4 2025 and select sector highlights are noted below:
239
Transactions
Energy 03
Consumer Staples 12
Utilities 02
Materials 28
Industrials 55
Financials 41
Information Technology 36
Communication Services 18
Consumer Discretionary 20
Healthcare 24
Q4 2025 Transaction Count by Sector
The Healthcare sector experienced an increase in transaction count, rising from 14 deals in Q3 2025 to 24 in Q4 2025. A notable transaction within the Healthcare sector was Canopy Growth Corporation’s announced acquisition of MTL Cannabis Corp. at an implied EV of $163.4 million.
The Industrials sector led the quarter with 55 transactions, accounting for 23.0% of total transactions in Q4 2025. A notable transaction within the Industrials sector was The Toro Company’s acquisition of Tornado Infrastructure Equipment Ltd. at an implied Enterprise Value (EV) of $298.9 million.
The Materials sector recorded 28 transactions in Q4 2025, representing 11.7% of the total transaction count in Q4 2025. A notable transaction within the Materials sector was Contango ORE Inc.’s announced merger with Dolly Varden Silver Corporation at an implied EV of $523.8 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 5.3% in Q4 2025, with 7 out of 10 sectors experiencing positive returns.
The Materials sector was the best-performing sector in Q4 2025, gaining 10.6%, and finishing the year as the top-performing sector with a 91.9% return. Forty-four of the 56 constituents posted positive quarterly returns, led by Discovery Silver Corp.
The Consumer Discretionary sector gained 9.5% in Q4 2025, with seven of nine constituents delivering positive price returns. Aritzia Inc. led the sector with a 35.6% gain during the quarter after reporting record Q2 2025 financial results.
The Financials sector declined modestly by 2.1% in Q4 2025, despite 15 of 24 constituents posting positive returns. Laurentian Bank of Canada and Power Corporation of Canada led the sector with gains of 21.9% and 17.3%, respectively.
The Industrials sector was relatively flat in Q4 2025, posting a 0.2% increase, with 14 of 29 constituents delivering positive share price performance. The sector was led by Badger Infrastructure Solutions Ltd., Bombardier Inc., and Finning International Inc.
Q4 2025 Sector Performance
Materials
10.6 %
Utilities
0.5%
Consumer Staples
9.3%
Energy
(1.9%)
Communication Services
4.9%
Financials
(2.1%)
Industrials
0.2%
Consumer Discretionary
9.5%
Information Technology
(0.3%)
Healthcare
7.5%
The Toro Company (Toro)
Contango ORE Inc. (Contango)
Canopy Growth Corporation (Canopy Growth)
has acquired
Closed December 8, 2025
Implied EV $298.9M
EV/EBITDA 15.0x
EV/Revenue 1.9x
The Toro Company (Toro) is a leading global provider of solutions for the outdoor environment, including turf and landscape maintenance, snow and ice management, specialty construction, irrigation, and outdoor lighting solutions. Toro serves professional contractors, rental companies, government agencies, commercial operators, and residential customers in more than 125 countries. Toro was founded in 1914 and is based in Bloomington, Minnesota.
Tornado Infrastructure Equipment Ltd. (Tornado) is a manufacturer of hydrovac excavation trucks and industrial equipment for underground construction and power transmission markets, offering high-pressure water and vacuum systems. Tornado has sold over 1,900 hydrovacs and provides heavy-duty truck maintenance services to excavation service providers in the infrastructure, industrial construction, and oil and gas sectors. Tornado was founded in 2008 and is based in Calgary, Alberta.
The acquisition of Tornado enables Toro to further expand its underground construction and specialty equipment portfolio, complementing existing brands and strengthening Toro’s position in the growing infrastructure and vacuum excavation markets.
is merging with
Announced December 8, 2025
Implied EV $523.8M
EV/EBITDA Not Disclosed
EV/Revenue Not Disclosed
Contango ORE Inc. (Contango) is a mining company focused on developing high-grade gold and precious metal projects in Alaska, including a producing interest in the Manh Choh gold mine and advanced exploration assets such as the Lucky Shot and Johnson Tract projects. Contango applies a direct-ship ore development strategy to advance its projects with a lower capital footprint. Contango was founded in 2010 and is based in Fairbanks, Alaska.
Dolly Varden Silver Corporation (Dolly Varden) is a mineral exploration and development company responsible for the Kitsault Valley Project in the Golden Triangle of British Columbia (B.C.). Dolly Varden has consolidated approximately 100,000 hectares of land in the Golden Triangle, including five past-producing high-grade silver mines: Dolly Varden, Torbrit, Porter Idaho, Mountain Boy, and Esperanza.
Dolly Varden was founded in 2011 and is based in Vancouver, B.C.
The merger of Contango and Dolly Varden will combine a producing gold asset with a high-grade exploration portfolio, creating a diversified precious metals company with enhanced scale, cashflow, and development potential across Alaska and B.C.
is acquiring
Announced December 15, 2025
Implied EV $163.4M
EV/EBITDA 12.1x
EV/Revenue 2.0x
Canopy Growth Corporation (Canopy Growth) is a diversified cannabis company that delivers innovative products across medical and adult-use markets in Canada, Europe, and Australia. The company also supports access to the U.S. through an interest in Canopy USA. The company’s portfolio includes owned and licensed brands, serving medical patients and adult consumers with flower, pre-rolls, hash, and vaporization devices. Canopy Growth was founded in 2013 and is based in Smiths Falls, Ontario.
MTL Cannabis Corp. (MTL) is a vertically integrated cannabis company focused on premium craft cannabis cultivation and medical cannabis distribution. MTL operates licensed indoor cultivation facilities in Quebec and Ontario, while also operating a leading medical cannabis marketplace and clinic network across Canada. MTL was founded in 2018 and is based in Pointe-Claire, Quebec.
The acquisition of MTL enables Canopy Growth to strengthen its leadership in Canada’s medical cannabis market, deepen its presence in key adult-use markets including Quebec, and expand its high-quality flower supply to support growth domestically and internationally.
S&P/TSX Composite Index (^GSPTSE) - Index Value
5.3%
About MNP Corporate Finance
In Q4 2025, the Canadian Dollar (CAD) strengthened modestly against the U.S. Dollar (USD), ending the quarter at 1.37 CAD/USD compared to 1.39 CAD/USD at the close of Q3 2025. This was substantially due to a narrowing interest rate differential.
In Q3 2025, real GDP rebounded strongly, increasing at a 2.6% annualized rate. Early indicators suggest that Q4 2025 real GDP growth will moderate, with an expected annualized rate of approximately 0.6%.
Annualized housing starts in Q4 2025 were estimated at 256,000 units, slightly below the Q3 2025 estimate of 272,000 units. Despite the quarter-over-quarter decline, housing starts in 2025 were higher than in 2024, largely due to government financing programs and rental construction.
In Q4 2025, the Consumer Price Index (CPI) increased above the BoC’s 2.0% target, reaching an average of 2.3%, compared to 2.0% in Q3 2025. Full-year 2025 CPI inflation is estimated to have averaged approximately 2.1%, down from around 2.4% in 2024.
The unemployment rate decreased to 6.7% in Q4 2025, demonstrating a modest improvement from Q3 2025. However, the December 2025 unemployment rate was higher on a month-over-month basis, driven by more Canadians re-entering the labour force and actively seeking work.
CAD/USD Exchange Rate
CAD Per USD
Historical
Forecast
1.37
Note: TD forecasts a Q1’26 CAD/USD exchange rate of 1.37.
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.
300+
Closed transactions (last 10 years)*
5B+
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 Q4 2025
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 Q4 2025 M&A Transactions - Canada
Sector
Return
1.37
Q1'25
Q2'25
Q3'25 Q4'25
2.75%
2.75%
2.50%
2.25%
2026F
1.3%
Q1'25
Q2'25
Q3'25 Q4'25F
2.2%
(1.8%)
2.6%
0.6%
2025F
1.7%
Year
Canada
Real GDP Growth (QoQ % change)
2026F
6.7%
Q1'25
Q2'25
Q3'25 Q4'25
6.6%
6.9%
7.0%
6.7%
2025
6.8%
Year
Canada
Unemployment Rate (%)
2026F
242
Q1'25
Q2'25
Q3'25 Q4'25
223
282
272
256
2025
259
Year
Canada
Housing Starts ('000s)
2026F
2.2%
Q1'25
Q2'25
Q3'25 Q4'25
2.3%
1.8%
2.0%
2.3%
2025
2.1%
Year
Canada
Consumer Price Index (YoY % change)
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