The value of UK M&A activity for the first half of 2024 rose by two-thirds compared to the same period last year despite volume being down by a fifth over the same period, according to figures from PwC’s latest Global M&A Industry Trends report.
In total the UK saw 1,703 deals in H1 2024, compared to 2,126 over the same period last year, a 20% decrease and almost mirroring the decrease in volume seen at a global level of 25%. Despite this, UK M&A activity is at roughly the same level as H2 2023 which saw 1,681 deals and is still tracking around the same level seen pre-Covid in 2019.
Our analysis shows there was a total of £68bn worth of UK deals in H1 2024 compared with £41bn in H1 2023 a 66% increase in value and better than global which saw a 5% increase in value. There were 16 deals greater than £1bn in value in H1 2024 with a combined value of £42bn, compared to seven deals with a combined value of £17bn in H1 2023.
UK M&A activity by industry for H1 2024 shows that Industrials and Services saw the most deal activity with 456 deals, making up just over a quarter of the total for the first half of the year, followed by consumer markets (383 deals) and technology, media and telecoms (376 deals).
The consumer markets industry saw deals with the highest value for H1 2024, making up almost a third of total deal value with £20bn worth of transactions. Financial services followed closely with £19bn, then TMT with £11bn.
Of the 1,703 deals in H1 2024 37% involved private equity, a slight decrease from the same period last year of 41%. The analysis also showed that of the £68bn in deal values generated in H1 2024, private equity accounted for 46% also slightly down from 52% in the first half of 2023.
In a statement, Hugh Lloyd Ellis, Private Equity Leader at PwC UK, said: “Relative stability is breathing life back into a deals market that has been suppressed for the last 18-24 months by macro-economic pressures and volatility. The lack of activity has inevitably seen a number of portfolio companies reach (or even go past) desired levels of maturity and this is why we are now seeing private equity houses planning a large number of exits.
“They face a careful balancing act that requires them to navigate a valuation gap compounded by 2021 entry valuation levels, with the need to return capital to LPs to protect future fundraising aspirations. This will create a market in which opportunistic buyers will capitalise, but they will need to heed the lessons of the last 24 months and a clear value story will be a prerequisite to acquisition.”
