Grant Thornton’s North West Corporate Finance has seen a substantial hike in deal values over the past 12 months, driven by strong buyer appetite.
In the 12 months to the end of June, the North West M&A practice of the accounting and consulting firm acted on 11 transactions across a diverse range of business sectors worth more than £350 million. These included working on buy-side and sell-side transactions. Nearly half of these deals involved international parties from countries such as Japan, the Netherlands and the United States.
Deals included the private equity-based management buyout (MBO) at Bolton-based Vernacare, the manufacturer of single-use medical products, and the sale of Tastecard and Gourmet Society to buyout giant Bridgepoint. Overall nearly half of the deals included private equity (PE) involvement, echoing the strong private equity push seen across the UK and European landscape, on the back of a very solid 2015.
“The North West private equity market is really active. Manchester has one of the largest concentrations of PE houses in Europe and they are all looking for good quality management teams to back”, says Matthew Bryden-Smith, Corporate Finance Director at Grant Thornton in the North West.
Trade buyers could be active too, believes Bryden-Smith, as there are record amounts of cash on corporate balance sheets. A report released by Grant Thornton last week, for instance, found that total cash on hand of the country's largest companies has risen by 14% since 2010 – now totalling £244 billion.
Looking ahead, the Corporate Finance Director says the signs for the firm in the coming year are highly positive, with data group Experian ranking Grant Thornton as the region’s most active financial adviser during the first nine months of 2016, having completed 18 deals. Nationally – Grant Thornton has 27 offices across the UK – in the four weeks after the Brexit referendum, the firm’s M&A teams advised on 21 deals with a cumulative value in excess of £800 million.
According to a recent analysis by Willis Towers Watson, merger & acquisition activity across the European landscape picked up in the third quarter of 2016, while a broader study, by BCG, found that the market’s key fundamentals still point towards a rosy outlook.