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Buoyant deal scene in East Anglia bucks national trend

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Merger and acquisition activity in East Anglia has bucked a national downturn and is currently buoyant in the region, according to Grant Thornton.

The firm says its corporate finance team in the region has handled a number of significant deals over the past 12 months and is in the advanced stages of negotiation for other disposals to be completed in the next couple of months.

Grant Thornton East Anglia’s corporate finance partner Darren Bear said: “There was a noticeable drop in business confidence in the latter part of 2011 which has led to more cautious deal activity in the year to date. However, here in East Anglia Grant Thornton has seen significant M&A activity over the past 12 months. This has been boosted by the shortage of quality assets on the market, so those that are on the market are attracting premium valuations."

Recent deals completed by Grant Thornton East Anglia’s corporate finance team include the sale of Peterborough-based baby products retailer to Wm Morrison supermarkets for £70 million; the sale of another Peterborough-based company, telecoms reseller Worldwide Group Holdings to Daisy Group plc for £28 million; and the acquisition of Pathway Care, the UK’s fourth largest independent fostering agency, by Acorn Care and Education Group.

Technology deals around Cambridge have increased consistently since 2009. Tim Hansell, corporate finance director at Grant Thornton East Anglia, said: “Technology firms in the UK will continue to attract private equity bidders in the coming months and attractive targets cover a diverse range of products.” Grant Thornton recently advised Cambridge-based software firm Brady plc on the acquisition of Norwegian firm Navita Systems AS and Swiss company syseca AG in deals worth £18.3 million.

However, the firm’s research shows M&A activity involving UK targets has fallen for the fourth quarter running to the lowest level since the 1990s. A total of 478 deals worth £17.1 billion were announced in the UK in Q1 2012, with both the number and total value of deals falling 11 per cent below the levels of the previous three months.

Since Q1 2011, the number of announced deals has fallen every quarter marking a total drop of 30 per cent. Only the number of private equity deals remained steady, while the value of UK acquisitions abroad dropped by more than half compared to Q1 2011.

The number of UK deals backed by private equity has remained steady in the last four quarters, with 77 private equity deals valued at £3.4 billion being recorded in the first three months of the year.

Last Updated ( Friday, 08 June 2012 08:09 )