London firms take lion’s share of global interest and private equity backing

Corporate deal activity within the manufacturing sector in the UK increased 5% last year with businesses based here being targeted increasingly by overseas-based organisations - according to a new study.

Analysis by law firm Irwin Mitchell of data provided by Experian highlights that mergers and acquisition (M&A) activity across the sector increased from 933 deals in 2014 to 981 deals in 2015.

In corporate deals where UK manufacturing companies were the target, one third (33.7%) of completed transactions were led by bidders based overseas, with 12% being based in the United States.

In 2014, just over a quarter (27%) of deals involving UK based manufacturing firms involved an overseas buyer. According to the data, 11% were from the US.

Signifying that the current dominance of London and the South-East, manufacturers based here were a target for 27% of all M&A activity across the sector in 2015 within the UK.

Interest within the sector from private equity backers fell however in 2015 compared to 2014. Out of all the manufacturing deals where UK companies were the target, 71 transactions were financed through private equity. Almost half of these completed deals involved businesses based in London or the South East.

Expert Opinion

"It is of course pleasing to see an overall increase in manufacturing M&A and it is encouraging that UK based firms continue to generate interest from overseas.

“Although this is credit to our reputation across the world, it’s important that more UK companies review their strategic options and look to grow through overseas' acquisition.

"Private equity interest is still lagging behind where it was in 2014, but there are encouraging signs and it will be interesting to see if this changes over the next 12 months."
Chris Rawstron - Partner

Irwin Mitchell recently appeared in Experian’s top 20 league table of most active M&A legal advisors during 2015.