Scots manufacturers gear up for blitz of mergers, sell-offs and investment

Of the sector’s senior decision makers polled for FRP’s The Manufacturing Agenda study, nearly a third said they expect their boards to be leading buy-side or sell-side M&A (mergers and acquisitions) deals over the next 12 months.

FRP, the specialist business advisory firm, said boards would also be prioritising enhancements to their firms’ digital and automation capabilities, focusing on skills and talent, succession planning and preparing to navigate new geopolitical risk. This follows a year where they have been focused on managing ongoing structural challenges, such as the sudden loss of key orders or customers, geopolitical or trade change and ESG (environmental, social and governance) regulation.

Scottish manufacturers are said to be planning fresh investments for the year ahead, prioritising those that will boost supply chain resilience, support sell-side M&A and deliver “robust” succession planning.

Callum Carmichael, restructuring advisory partner at FRP in Edinburgh, said: “These findings reflect management teams that clearly understand where risks sit, and are proactively planning to meet capability gaps and build long-term value and resilience. It also shows that resilience is no longer purely defined by financial strength - it’s about the capability to make strategic investments like M&A, align with regulation and adapt at pace.”

He added: “As Scottish manufacturers look to take these steps next year, it’s critical that they have the right support - something that they’re already recognising through investments in processes like M&A and succession planning.”

Lenders and investors share many of the same 2026 focus areas as boards. When asked what would prompt them to intervene in a portfolio company over the next 12 months, lenders and investors cited cost, cashflow and working capital, investment, automation and digital execution, as well as leadership resilience.

Carmichael added: “As well as helping guide operational decisions, expert advisory support can also help align perspectives between boards and lenders.”