Private equity and venture capital firms did fewer but bigger deals in Canada in the first half of 2026, according to the group representing the country’s private capital industry.
The total value of investments made by the private equity sector fell compared to a booming 2025, but held steady compared to prior years, while the total dollars deployed in the venture capital space rose, said two reports from the Canadian Venture Capital (CVCA) and Private Equity Association.
Private equity firms focus on acquiring established companies that need restructuring or growth capital, while venture capital investors target higher risk, early-stage startups with the potential to grow.
CVCA chief executive officer Benjamin Bergen said the rise of the megadeal is not a trend that’s unique to Canada and is also happening globally.
In the first half of 2026, private equity firms invested $12.7-billion across 252 deals in Canada, a 59-per-cent drop from the $31-billion invested across 332 deals in the first half of 2025.
However, Mr. Bergen pointed out that private equity activity appears steadier when compared to 2023 and 2024 dollar totals. The first half of 2023 saw $5.6-billion invested, and the first half of 2024 saw $8.6-billion.
The market consolidated into fewer, larger financings, CVCA’s report noted.
Opinion: Private equity is buying up Canada’s disaster economy. Consumers will suffer
During the first half of this year, the privatization of four companies – Dentalcorp Holdings Ltd., Information Services Corp. ISC-T, ECN Capital ECN-DB-C-T and Blackline Safety Corp. BLN-T – made up 57 per cent of total capital deployed. That continues a trend of publicly traded companies on the Toronto Stock Exchange being bought by private equity investors and taken private.
“A few very large take-privates shaped the half, with global and domestic capital both deploying into Canadian companies at scale,” Mr. Bergen said in a press release.
The initial public offering of Canada’s biggest drug manufacturer, Apotex Health Corp. APTX-T, in June was the most notable sale by a private equity firm. The company, which was backed by New York-based SK Capital Partners, launched the largest Canadian IPO in five years.
Canadian venture capital firms invested $2.7-billion during the first half of the year, up by 17 per cent from the same period last year. However, the total number of deals fell by roughly 9 per cent to a total of 250.
The CVCA said it was the first time since 2021 that venture capital investments climbed in the first half of the year compared to same period in the prior year.
“There was a tremendous amount of capital that flowed in 2021, and it kind of distorted venture capital and, to some extent, [private equity],” Mr. Bergen said in an interview.
How St. John’s has become an unlikely hub for tech startups
“What our data is trying to show, is that we’ve actually returned to sort of normal levels that are outside of that 2021 year.”
The largest early-stage transaction in the first half of this year was the $139-million financing round raised by Ontario-based Dominion Dynamics. The deal also marked the largest Series A early-stage venture capital financing ever by a Canadian defence startup.
Meanwhile, foreign investors had a major presence in later-stage VC deals in the first six months of the year. Foreign investors took part in 56 per cent of the funding deals, up from 30 per cent a year earlier, as Canada has been increasingly trying to attract capital from outside its borders.
“Given all of the geopolitical and technology changes that are occurring, we are seeing Canada hold ground, and there is a huge opportunity for Canada to try to seize more wealth, prosperity and sovereignty that exists globally,” Mr. Bergen said.