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UK M&A volumes fell during HY11, but value rose, says Experian

The number of mergers and acquisitions during the first six months of 2011 (HY11) fell by 15% compared to the same period in 2010, according to Experian. The company’s latest mergers and acquisitions (M&A) and equity capital market (ECM – flotation, rights issue and placements) data has also revealed that the value of deals during HY11 increased – up 7% compared to HY10. 

According to Experian, a total of GBP101.8 billion worth of transactions were announced in the UK in HY11. Rothschild was the best performing financial advisor by volume with 46 deals, while Citigroup was the highest by value with deals worth a total of GBP23.3billion. DLA Piper advised on the highest number of transactions (53) in HY11, while the leading legal advisor by value was Linklaters with deals worth a total of GBP21.3billion.
 
Europe saw a 28% decrease in European M&A and ECM transactions announced during HY11 with 4,377 deals compared to 6,040 transactions in HY10.

The values of European transactions rose by over 18% compared to HY10 with GBP371.1billion recorded in HY11, up from GBP314.3billion worth of transactions announced in Europe in HY10.

There was a UK element in 45% of all European transactions, up from 38% in HY10. In terms of value the UK consistently contributes around 30% of the European total each HY.

The majority of the UK’s deals during HY11 were with the USA, followed by Germany.

In the USA volumes were down in HY11 by 37% while values were up by 20% compared to HY10.

Asia Pacific witnessed declines in both volume and value during HY11 by 17% and 12% respectively.
 
Wendy Smith (pictured), Business Development Manager at Experian Corpfin, says: “The first half of 2011 shows that there is still a degree of tentativeness in the market. This is further impacted by the fact that there are fewer business insolvencies to create opportunities and liquidity in the market and, to some extent, the fact that vendors still have high expectations on price. The North West and Wales are the only areas that appear to be bucking the trend at the moment, with both seeing slight increases in the volume of deals.
 
“Looking across Europe and the rest of the world, around a third of the companies involved in deals are based outside the UK, so it is very much a global market place. It is not surprising that the low activity can be seen across the board. 
 
“Nonetheless, we are in a more optimistic place than we were in a year ago and, as increasing numbers of businesses begin to focus once again on strategic growth rather than cost-cutting, we would anticipate a small rise in deal volumes in the coming year.”

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