Member Article

Merger and acquisition activity rockets in third quarter

Merger and acquisition activity in the third quarter of 2013 was the highest it has been since pre-recession times, research indicates.

Figures from Experian show M&A transactions totalled 1,043 during the quarter, adding up to a combined £122bn.

It represents a three-fold increase on the previous quarter, and a significant rise in UK firms taking over foreign businesses.

The value of deals in the North East increased from £159m to £358m year-on-year while in the North West the value of deals rose from £808m to £1,357m.

Inward investment to the UK was up from 187 deals in Q3 2012 to 195 deals in Q3 2013 - the rise largely attributable to Vodafone’s £84bn sale of US joint venture, Verizon Wireless - the largest transaction in British corporate history.

The manufacturing sector was the main driver of deal making activity across the quarter, accounting for 31.1% of the overall UK total. Financial services accounted for 29.5% of deals and transaction values in the sector almost doubled from £13.5bn in Q3 2012 to £20.2bn in Q3 2013.

Wendy Driver, business development manager at Experian UK&I, said: “Although deal volumes remain somewhat suppressed, the UK returned a robust set of results in Q3, with an upturn in large corporate transactions, strong value figures and encouraging activity in the manufacturing, mining and transport sectors.

“While certainty remains in short supply, the recent economic news coming out of the UK is reassuring and with increased reports that the number of deals in the pipeline is on the up, a stronger more robust M&A market might be closer than we thought.”

European deals saw a slight reduction in transaction volume but a substantial upturn in deal value from £113.5bn in Q3 2012 to £202.9bn in Q3 2013.

North American deal volumes were down by 28.4% and activity in the Asia-Pacific region was described as “relatively lacklustre.”

This was posted in Bdaily's Members' News section by Tom Keighley .