Israeli defense tech M&A surges to $3.26 billion in first half of 2026

M&A activity in Israel's defense tech sector surged to $3.26 billion in the first half of 2026, an 8.5-fold increase from 2025, according to a Frost & Sullivan report. US acquirers led at 45% of transactions, with deals concentrated in autonomous systems, sensors, and robotics.

Merger and acquisition activity in Israel's defense technology sector surged to $3.26 billion in the first half of 2026, an 8.5-fold increase from $384 million in 2025, according to a Frost & Sullivan report exclusively seen by The Jerusalem Post. The report, presented at an industry event in Tel Aviv, examined 44 announced deals between 2023 and 2026, with 22 disclosed values totaling about $4.1 billion. US-based acquirers accounted for roughly 45% of transactions, Israeli purchasers about 30%, and European companies about 11%. More than half of the deals were in defense electronics and sensors, UAVs and autonomous systems, and ground systems and robotics. The report attributed the growth to proven battlefield effectiveness and adaptability of Israeli technology, as well as the wars in Ukraine, the Persian Gulf, Lebanon, and Gaza. Ariel Sagee of Gornitzky linked the growth to global geopolitics, and Irit Nudelman of Frost & Sullivan predicted continued strong deal activity in anti-drone systems, robotics, and space.