Yorkshire Manufacturing Deal Volumes Fall By 44%

Corporate Lawyer Optimistic About Second Half Of The Year


David Shirt, Press Officer | 0161 838 3094

M&A activity amongst Yorkshire-based manufacturing companies fell by 44% in the last quarter compared to the first three months of 2015, says a new study.

Analysis by national law firm Irwin Mitchell of data provided by Experian, the global information service* has also highlighted that the number of manufacturing deals involving Yorkshire companies in the first half of the year is 81% lower than it was at the same stage in 2014.

Yorkshire companies’ share of manufacturing deals across England fell to 8.5% compared to last year when it is was 12.3%. The current figure for this year is the lowest it has been since 2012 when it was just 7%.

The level of deal activity amongst Yorkshire-based manufacturing companies was down by a third on levels seen in the North West after the first six months of the year. Nationally, M&A activity in the sector in the first half of the year stood at 257 - 10% lower than in 2014.

Significantly, Yorkshire manufacturing companies were the subject of only 4% of the deals in the sector which were backed by private equity.

The position in Yorkshire mirrors the national picture where the number of private equity backed transactions in the sector fell by 10%. Less than one in 10 manufacturing deals completed during the six months of 2015 was financed through private equity – the lowest proportion since 2012.

The latest statistics in Yorkshire follow a disappointing set of output figures for the sector. Announced at the beginning of July, official figures from the Office for National Statistics (ONS) show that production levels in the manufacturing sector fell for the second month in a row in May.

ONS said output fell by 0.6% following a decline of 0.4% in April. Manufacturing in the three months to May was 4.6% below its level at the start of the recession in 2008.

Expert Opinion
“These figures are disappointing but perhaps reflect the uncertainty around the General Election and also the general fall in output across the sector. Private equity interest has reduced substantially and I expect that it will remain so until the sector as a whole shows signs of consistent improvement.

“There are signs of improvement though and although the overall manufacturing sector is facing numerous challenges, there are plenty of sub sectors that are booming and I expect that this will fuel greater M&A over the coming months. Our deal pipeline looks strong for the rest of 2015 and I remain optimistic.”
Andrea Cropley, Partner

There was a mixed picture in deal activity across the all regions within England with all areas, except the North West, seeing manufacturing deal numbers fall. London and the South East retained its dominant position with a 28% of share of manufacturing M&A, however this figure was lower than the total percentage figure recorded in 2014.

Irwin Mitchell’s Corporate & Commercial team is one of the largest in the Yorkshire region. The team consists of eight partners who advise businesses on a range of issues from M&A and fundraising to regulatory support in areas such as data protection. According to Experian, Irwin Mitchell is one of the most active law corporate law firms in the Yorkshire region by deal volume.

The team has continued to invest in growth and recently recruited Corporate partner Philip Goldsborough into its Leeds office from Pinsent Masons.
*Data sourced from Experian’s proprietary Corpfin M&A deals database.