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Private equity-owned businesses drive growth and jobs in 2017

UK private equity-owned companies are driving growth against a backdrop of uncertainty as they boosted revenues by 12 per cent in the last year, according to research by accountancy and business advisory firm BDO.

BDO reveals that the UK’s private equity-owned companies (from a sample of 902 portfolio companies where private equity firms together own between 50.01 per cent and 100 per cent) have seen revenues increase by 12 per cent from GBP37.4 billion to GBP42 billion in the last year.
 
These private equity-owned companies are also boosting the UK labour market. Now employing 311,833 people in the UK, these businesses have grown their workforces by 8.5 per cent in the last year from 287,488 and 26 per cent in the last five years from 248,299. 
 
Driving growth across the whole of the UK, 41 per cent of these high-growth companies are based outside London and they contribute a third (33 per cent) – GBP13.6 billion – of the overall revenue of these companies in 2017.
 
Yet despite seizing opportunities for growth, their needs and contribution to the economy are often overlooked.
 
Jamie Austin, partner and head of private equity at BDO LLP, says: “The UK’s private equity-owned businesses are proving their worth as they continue to shake misconceptions about their impact on the UK economy. They are in fact fuelling growth in our national and local economies while creating much-needed job opportunities for people in times of uncertainty.
 
“As Brexit negotiations finally start to take shape, it’s now more important than ever that the Government ensures these dynamic, high-growth businesses don’t fall into a policy gap and that they remain a firm part of the UK’s driving force for post-Brexit growth.”
 
Leading the charge for growth in Yorkshire and The Humber, private equity-owned businesses in the region have seen revenues rise by 21.4 per cent in the last year from GBP2.8 billion to GBP3.4 billion. Businesses in the region are also hiring more people, boosting employee figures by 55 per cent from 10,240 to 15,900 in the last year.
 
Growth in the South East tells a similar story as private equity-owned companies in the region have grown revenues by 20.3 per cent from GBP2.7 billion to GBP3.24 billion in the last year. These fast-growth firms have created 64 per cent more jobs in 2017 from 11,784 to 19,290.

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