Business News

The Shoots of Recovery? M&A Market Looking Greener by the Day!

M&A activity in the UK over the past 6 months has undoubtedly endured a rollercoaster ride as the effects of the recession have been felt by British businesses. As one would expect, businesses have been more cautious in their approach to mergers and acquisitions. Indeed, statistics from Corpfin (part of Experian) indicate that the number of deals that took place between February and August this year, 865, was much lower than the figure from the previous 6 months, 1028. Furthermore, the 865 deals were considerably down on the 1716 deals in the same period from February to August 2008.

Despite the apparent negativity, however, there are signs that the M&A market is definitely seeing an upturn. Interestingly, the Corpfin statistics show that over the last 6 months the average deal value for deals with disclosed values is nearly £88 million. This is almost twice as much as the average deal value for the corresponding period last year of £49 million. This suggests that although the quantity of deals may be slightly down, the quality of deals is as high as ever.

The monthly deal numbers themselves have also seen increasing positivity over recent months. Although summer is traditionally a slow time in the corporate finance world, June and July saw highly respectable monthly deal number figures of 144 and 137 respectively, as well as respective hugely impressive average deal value figures of £244 million and £64 million.

This positivity is reflected at The Corporate Finance Network, the national organisation that specialises in corporate finance for SMEs, to which TWP belong. Ourselves and our co-member firms have advised on many exciting, high quality mergers and acquisitions over the past few months. We are all finding more and more from our clients that they see synergies gained from mergers and acquisitions, as crucial to surviving the challenging times. Indeed, in many cases these synergies are enabling clients to thrive, despite the recession.

The Corporate Finance Network’s monthly Network Opportunities e-newsletter contains full details of the current businesses wanted and businesses for sale from within our network, as well as a selection of recent deals advised on by member firms. If you would like to be included on the distribution list for the newsletter, or if you have any acquisition criteria that you would like to add yourself, please contact your usual partner at TWP or email the details directly to Philip Munk on p.munk@twpaccounting.co.uk.