News

Digital Services Industry Update Q1’2025: M&A Rebounds fueled by PE and Strategic Acquisition Growth

16 Apr 2025

The Digital Services sector saw an uptick in momentum in Q1 2025, driven largely by Private Equity which significantly influenced M&A through both platform and bolt-on acquisitions. Strategics also remain active, pursuing clear acquisition strategies aimed at strengthening their cybersecurity capabilities and advancing cloud transformation initiatives.

The 15th edition of our Digital Services Industry Update offers a detailed look at recent M&A and fundraising activity, along with key insights into current and emerging trends shaping investment across the sector – including digital transformation, cloud migration, tech-enabled services, cybersecurity, and data-driven business intelligence.

Overall Digital Services M&A activity in Q1 increased, totaling 730+ & $15.8bn+ in disclosed M&A deals, with consistent fundraising transactions at 530+ & $25.9bn+ in disclosed fundraises, including:

  • Atlantic Tomorrow acquired BrainSell for an undisclosed amount (Advised by Drake Star)
  • World Wide Technology acquired Softchoice for $1.3bn
  • Netcompany acquired SDC for $138m
  • CGI acquired bjss for an undisclosed amount
  • IK Partners has signed an agreement to invest in HSL Compliance, alongside LDC who are reinvesting as part of the transaction
  • GCP has realised its investment in Bridewell to an investor group including Oakley Capital, Eurazeo and Sagard NewGen
  • DyFlex Solutions raised an undisclosed amount of development capital from Five V Capital
  • Cognida raised $15m of Series A-1 and Series A venture funding from Nexus Venture Partners
  • Thrive raised an undisclosed amount of development capital from Berkshire Partners

Sam Levy, Partner at Drake Star, shares his views on the sector and notes: “Despite turbulent macroeconomic conditions, we anticipate the Digital Services sector to continue attracting interest from both Private Equity and Strategic investors, with a focus on resilient and more efficient operational business models. This, coupled with a substantial backlog of Private Equity exits, is likely to drive further M&A activity throughout 2025.”

Download the full PDF below for more insights below.
MORE INSIGHTS

Inquiries

For further inquiries, please contact:

Region

Get In Touch

Please search by region and sector so we can point you to the right member of our team.