Investor alignment with the government’s renewable energy agenda continued to shape merger and acquisition (M&A) activity in the Philippines in 2025, with clean energy emerging as a key driver of deal flow despite a more selective investment environment.
According to Isla Lipana & Co./PwC Philippines’ Year-End M&A Report 2025, a total of 74 M&A deals were announced in the country as of December 4, 2025, amounting to US$4.6 billion in disclosed deal value. While overall deal volume moderated, investor appetite remained focused on sectors offering long-term resilience and sustainability-linked growth.
The energy and natural resources sector accounted for 29.7% of total deal volume, leading all industries, followed by consumer and retail at 14.9%, and industrials at 12.2%.
“Philippine M&A trends last year highlighted both our resilience points and opportunity strongholds,” said Trissy Rogacion, PwC Philippines M&A and Corporate Finance partner. “While deal volume was lower, transactions are taking longer to close. We expect a number of these deals to be completed early this year.”
Clean energy leads deal values
The energy and natural resources sector recorded a combined deal value of US$1.9 billion from 22 transactions, underscoring the growing investor shift toward renewable and transition energy assets.
Among the largest deals was Prime Infrastructure Capital’s US$897.5-million acquisition of First Gen assets. Manila Electric Company (Meralco) also invested US$127.6 million in SP New Energy Corporation, reflecting demand for flexible, renewable-linked power projects. Another notable transaction was SembCorp’s US$77.4-million acquisition of the Puente Al Sol solar farm in Negros Occidental.
Investor confidence continues to be reinforced by policy support, including the Philippine Energy Plan, which raised the government’s renewable energy target to 35% of total power generation by 2030, as well as incentives such as duty-free importation of renewable energy equipment.
Other sectors on investors’ radar
The real estate and infrastructure sector posted a total deal value of US$1.2 billion, with asset quality, location, and tenant mix driving transactions. Recent legislative reforms, including the Real Property Valuation and Assessment Reform Act and the Accelerated and Reformed Right-of-Way (ARROW) Act, also influenced infrastructure-related investments.
Meanwhile, the industrial sector recorded nine deals with a combined value of US$180 million, primarily involving commercial and institutional construction, as well as metal smelting and refining activities.
Outlook for 2026 and beyond
Looking ahead, the energy sector is expected to remain the primary engine of Philippine M&A activity in 2026, as both local and foreign investors expand exposure to renewable and sustainability-driven assets.
The healthcare sector is also projected to sustain deal momentum, with operators focused on expanding hospital networks nationwide amid growing demand for quality healthcare services.
“Even as investors remained strategically selective in 2025, we anticipate sustained interest across key sectors,” said Roderick Danao, PwC Philippines chairman and senior partner. “Renewable energy deals clearly drove the market last year, showing strong alignment with the government’s long-term clean energy agenda. This sets the stage for a new wave of M&A activity, particularly in the energy sector.”