Drake Star's report highlights a significant increase in M&A activity among managed service providers, emphasizing the importance of operational maturity and cybersecurity in strategic transactions.

Information on the Target

Drake Star recently released its latest report on mergers and acquisitions (M&A) within the managed service provider (MSP) sector, indicating a notable resurgence in both transaction volume and value during the third quarter of 2025. This quarter marked an impressive uptick, with 108 deals totaling $2.6 billion in disclosed value. The report highlights that 85% of these transactions were related to IT services, reflecting a growing trend towards technological integration and management in various business sectors.

The report identifies key trends among sophisticated acquirers who are pursuing consolidation strategies. These entities are focusing on MSP platforms that demonstrate operational maturity, high-quality recurring revenue, robust cybersecurity measures, and specialized expertise in vertical markets. This emphasis on operational capability and client impact underscores the evolving requirements for MSPs in today's environment.

Industry Overview in the Target’s Specific Country

The managed services industry has been experiencing significant transformations, particularly in the United States. Rising demand for IT services, fueled by increased digitization across industries, has led to a competitive landscape