Indonesia M&A Outlook 2026: Clear Deal Drivers, Real Valuation Gaps, and the Sectors Buyers Want

The domestic story is both simple and complicated. Practitioners describe Indonesia as attractive “from thirty thousand feet,” citing close to 290 million people and growth near 5 percent. But the same discussion stresses that execution, not attraction, is often the constraint. Foreign ownership can be capped sector by sector, and multiple authorities can sit between signing and operating. On the tax side, investors face a wide compliance surface, described as roughly eleven different taxes across central and regional government, and risks can include historic exposure that only appears after signing, such as unpaid or undisclosed liabilities and transactions that were never declared.

Deal Drivers and Why Buyers Are More Selective in 2026

Across 2026, dealmakers are becoming more selective, prioritizing strategic alignment, operational resilience, and long-term value creation. PwC’s 2026 mid-year outlook says deal volumes declined in early 2026 compared with the prior year and links the caution to AI-related uncertainty. At the same time, PwC also notes megadeal values are on track to increase year-on-year by 40% in 2026 if the current pace continues, highlighting how well-capitalised buyers can pursue scale and strategic transformation even as mid-market activity is constrained. Lexology also points to private equity firms working through multi-year exit backlogs, supported by narrowing valuation gaps, which can help deals move when price expectations start to converge.

In Indonesia, regulatory and structuring considerations are part of the valuation conversation because they affect certainty and timing. Under KPPU Reg 3/2023, notification thresholds include combined assets exceeding IDR 2.5 trillion or combined revenue exceeding IDR 5 trillion for general sectors, and an IDR 20 trillion asset threshold for banking. Observers expect KPPU’s enforcement posture to tighten through 2026, with a stated priority of addressing anti-competitive concentration in strategic sectors including digital platforms, mining, and consumer goods. The same guidance notes parties may submit a draft notification before closing for informal feedback, a practical lever to reduce closing risk when valuation gaps are driven by uncertainty rather than fundamentals.

So where are acquirers leaning? Global sector notes highlight continuing demand in Technology, Media & Telecommunications, with interest shifting toward mid-market targets with strong, stable cash flows, high retention rates, and scalable models, while AI-native and infrastructure software lead deal flow and command high interest. PwC also observes renewed attention in healthcare, pharmaceuticals, consumer goods, and industrials, where some assets are perceived to carry lower disruption risk or clearer demand drivers. In Southeast Asia, Lyndon Advisory flags that export-exposed sectors were hit harder by tariff uncertainty, reinforcing why buyers may prefer resilience and controllability. In Indonesia specifically, the practical “buyer’s sectors” are often those where licensing, permits, and ownership limits can be mapped early—ideally at the term sheet stage rather than after signing.