The distribution sector saw an increase in merger and acquisition deals in the second quarter of the year, and that growth appears poised to continue, according to the latest quarterly report from investment bank PMCF.
The bank’s Q2 “Distribution M&A Pulse” report identified 70 M&A transactions in the quarter, which represented a 7.7% increase compared to the second quarter of 2025. Although the analysis noted that deal activity has not returned to “peak-cycle levels,” improved confidence from buyers, the availability of capital, and a more predictable tariff environment pointed toward continued growth.
The report also highlighted the growing significance of technical expertise and service capabilities for potential sellers, as well as the importance of demonstrating growth in volume and market share in an era of “price inflation and tariff-driven pass-throughs.”
A boom in data center construction, meanwhile, continued to benefit distributors even beyond electrical products, the report noted — including providers of fasteners, safety products and MRO supplies.
“Wesco now generates more than 20% of revenue from data center-related activity,” PMCF analysts wrote, “while Grainger continues to report strong project-driven demand from contractors supporting new facility construction despite having limited direct exposure to the sector.”
