Private Equity Accounts For 16% Of National Deals In Q2

Deal activity in the last quarter amongst UK manufacturing firms reached its highest level for six years according to a new report.

According to the latest Experian Corpfin data and analysis from national law firm, Irwin Mitchell, manufacturers in the UK were the target of 200 deals during the second quarter of 2014. This compares to 183 in Q1 and takes the total number of deals this year to 383 – 28% more than the same period in 2013.

To further demonstrate the current strength of the sector, Irwin Mitchell’s report highlights that not since 2008 have the number of manufacturing deals completed in a three month period stood at 200 or more. 

The South East strengthened its number one position with 32.4% of the total volume of manufacturing M&A, whilst the North West’s claimed 14.6% of deals. This percentage was higher than Yorkshire, the West Midlands, the South West, the East Midland and East Anglia.

The report also reveals a slight increase in the percentage of manufacturing deals which involved private equity. Nationally in the first quarter of 2014, the figure stood at 15.3%, but this increased to 16% in Q2. It was still below levels seen in 2013 when 28.5% of manufacturing M&A was PE backed.

Chris Rawstron, Partner and Head of Corporate & Commercial at Irwin Mitchell said:

Expert Opinion

The message is clear. The manufacturing sector is driving a significant amount of M&A activity and with deal flow now 28% higher than at the same time last year, the signs are that we are in for a very strong year.

“There was a slight improvement in Q2 in terms of the number of deals backed by private equity, but the percentage figure is still well down on what we have seen in previous years.

“Despite this, there are some very encouraging signs for the manufacturing sector and it is vital that any company currently considering their strategic options ensures that they take the appropriate professional advice to ensure their position in the market ahead of any sale or purchase is optimised.”
Chris Rawstron - Partner

This research is based on data sourced from Experian Corpfin’s proprietary M&A deals database.