In light of current developments in the European SME market, succession planning is becoming increasingly important for many family business owners.
At first glance, the headlines are not very encouraging: The Argos Index®, the established valuation benchmark for the European private mid-market, stood at 8.3x EBITDA in the fourth quarter of 2025—its lowest level since 2014.
Recent studies and media reports also paint a picture of uncertainty in the private equity world. Entrepreneurs reading this news might be tempted to postpone their planned sale of the company and wait for calmer times instead.
However, that might be a hasty conclusion. If you take a closer look, you’ll find some encouraging signs—especially for successful family businesses with long-term, stable business models and sustainable profitability.
Succession Planning for Companies in the Current M&A Market (2026)
First, to put this into context: Lower valuation multiples do not necessarily mean that a sale is unattractive. Above all, they indicate that buyers’ and sellers’ price expectations are converging again, and that is precisely what is revitalizing the market.
In fact, transaction activity in the second half of 2025 rose by a remarkable 30% compared with the first half of the year, with over 500 completed transactions in the European SME sector—the highest level since 2018.
The Argos Index® itself notes that increased activity coupled with lower prices is a typical sign of a market bottom. In other words, those who trade now may be acting at exactly the right moment—namely, at the turning point.
Why Companies Should Strategically Prepare for Succession Planning
Strategic buyers remain active and are paying attractive prices for solid, well-positioned companies, particularly in resilient sectors.
In doing so, they value well-established structures, long-standing customer relationships, and business substance—qualities that family-owned businesses are particularly well-suited to provide.
The financing market also remains stable despite macroeconomic uncertainties, as evidenced by the continued availability of debt financing for acquisitions.
The latest Dealsuite DACH Monitor for the first half of 2026 strongly confirms this outlook: 76% of the advisors surveyed are optimistic about the coming months. 45% report an increase in their client mandates compared to the previous six months—a clear sign that the market is gaining momentum and that buyer demand is genuine.
The current environment thus offers a real opportunity, particularly for family business owners who are weighing the right moment to plan for succession or sell their business.
Well-prepared companies with stable earnings power can still achieve high valuations and benefit from the fact that competition among buyers remains strong despite everything.
Waiting for supposedly better times often means unnecessarily limiting one’s own room to maneuver. Those who seek dialogue now are acting with foresight and have the tailwind of a noticeably recovering market behind them.
The current M&A market in Germany clearly shows that well-prepared companies continue to attract significant interest from strategic buyers and investors. Family-owned businesses in particular—those with stable structures, long-term customer relationships, and sustainable profitability—are benefiting from continued strong demand in the SME sector.
In addition, many market participants expect transaction activity to continue to grow throughout 2026.
Current M&A trends in Germany suggest that buyers are increasingly focusing on high-quality companies and are willing to pay attractive valuations for compelling business models.
This gives business owners the opportunity to strategically plan their succession arrangements early on and prepare for the sale under optimal conditions.
Please feel free to contact us at any time for a confidential and non-binding initial consultation if you would like to learn how your company is positioned in the current market environment.
Together, we will analyze your specific situation, assess potential opportunities in the current M&A market in Germany, and develop a customized strategy for a successful succession plan or a structured sale of your business.
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