A €6.4 billion deal to sell Portugal’s Novobanco to France’s Banque Populaire – Caisse d’Épargne (BPCE) has dramatically reshaped the country’s mergers and acquisitions landscape.The transaction, finalized in December 2025 after months of negotiation and regulatory review, reversed a projected decline in Portuguese M&A activity and propelled the overall value of deals to a three-year high. This sale marks a significant shift in Portugal’s banking sector and signals renewed international investment confidence in the nation’s financial assets.
A major deal involving a Portuguese bank has dramatically shifted the country’s mergers and acquisitions (M&A) landscape, turning a projected decline into growth. The transaction is poised to reshape the competitive dynamics within Portugal’s financial sector and beyond.
Investment in Portuguese M&A activity fell 18.5% in 2024 to €11.1 billion, according to data from TTR Data. The number of transactions also saw a slight decrease, down 0.6% to 654. This marked the second consecutive year of decline, despite initial market expectations for a recovery, albeit a modest one.
However, the year could have ended with a contraction, but the announced sale of Novobanco to France’s Banque Populaire – Caisse d’Épargne (BPCE) for €6.4 billion – a figure expected to rise with the sale of the state’s stake – completely altered the outlook. The deal will see the fourth-largest French financial group acquire the fourth-largest bank in Portugal.
The transaction, by far the largest recorded in Portugal last year and in the decade, has already impacted market figures, even though final regulatory approvals are still pending. TTR Data now reports a 28.15% increase in the value of M&A activity to €17.56 billion, the highest level since 2021. While the number of transactions dipped slightly, falling 0.46% to 655, the overall value surged.
The Novobanco deal significantly boosted activity in the private equity segment, more than doubling its value to €8.559 billion across 107 operations. Approximately 30% of the deal values have been publicly disclosed. The increase reflects the exit of international funds from mature assets and large-scale industrial transactions, exemplified by the involvement of Lone Star and BPCE.
Asset acquisitions also rose, increasing by 30.55% to €4.36 billion. Real estate continued to dominate, accounting for 72 transactions, but renewable energy gained traction with 14 deals, a 40% increase compared to 2024.
In contrast, venture capital experienced a 17.56% decline in total investment, reaching €830 million, aligning with a normalization trend following a period of rapid technological growth. While deals related to software for the healthcare sector and internet-based businesses increased, investment in the industrial sector decreased.
Impact on Advisory Firms
The Novobanco transaction has also reshuffled the rankings of financial advisory firms. Bank of America, which did not feature in the 2024 rankings, now leads the list of financial advisors due to its role in the deal. Similarly, Linklaters has risen to the top among legal advisors, having advised Novobanco on the transaction. CS’Associados, representing the buyer, and DLA Piper, representing the seller, also saw significant gains in their rankings.
VdA stands out among the firms involved in the Novobanco deal, securing second place in the rankings with a value of €6.94 billion.
In the consulting sector, Deloitte led in terms of deal value, followed by EY, reversing their positions based on the number of transactions.
The year 2025 will be remembered as a recovery year following the decline in 2024, continuing the pattern of annual fluctuations seen since the beginning of the decade. Market participants express cautious optimism for the coming year, citing numerous ongoing deals, including some of significant size. However, geopolitical uncertainty and monetary policy developments have caused delays, and without a deal of the magnitude of Novobanco in the pipeline, 2026 is likely to see an adjustment.
