Barış Öney
The UK’s private equity dealmakers enjoyed their busiest summer in five years as ongoing political uncertainty over Brexit failed to dampen appetite for buyouts in the country.
Buyout and growth firms completed 65 investments in UK companies from July 1 through to September 30, according to Dealogic — a near 14% increase on the 56 deals in the same period last year and the joint-highest figure for any quarter since 2013 alongside Q2 in 2014.
The uptick in UK dealflow was driven by continued appetite for deals, particularly among foreign buyers taking advantage of a weaker pound, while the fall in total deal value indicates some caution among firms seeking to deploy their vast war chests.
While the volume of deals hit a five-year high in the third quarter, their combined value slid to $6.48bn — a marginal decrease on the $6.7bn invested in the equivalent part of 2017.
Europe, by contrast, suffered a decline in both the number and total value of deals. A total of 176 deals worth $37.57bn were completed across the continent from July to September, down from 189 valued at $44.17bn during the same period of 2017, Dealogic data showed.
Much of the activity was focused on the midmarket, according to Tom Whelan, head of European private-equity at law firm Hogan Lovells.
“It was the UK mid-market driving these deals over the summer,” he said. “A lot of the businesses we saw being sold were worth between the €100m and €300m mark. In what is traditionally a quieter period, some of my colleagues had their holidays ruined.”
UK mid-market deals announced over the summer include private-equity firm Phoenix Equity Partners’ acquisition of Nexus Vehicle Rental and General Atlantic’s purchase of a minority stake in lending start up Greensill Capital, Dealogic data shows.
Buyout firms have taken advantage of a strong exit market as they seek to deploy a combined $1tn of accumulated capital known as dry powder.
Source: pe-insights.org // fnlondon.com
