This study investigates the extent to which diplomatic relations affected merger and acquisition (M&A) activities in the European Union during the years 2001–2019. Implementing a gravity model, we find a positive relationship between diplomatic distance and M&A activities meaning that a worsening in diplomatic relations fosters inward M&As in Europe. The finding suggests that cross-border acquisitions to Europe could be a way for the investing firm to mitigate weak diplomatic relations’ related issues, such as access to host markets’ information and technology. It is confirmed especially when foreign investors target high-tech firms, are private (rather than state-owned) enterprises and buy larger shares of the target companies.