Is this the beginning of an M&A boom in the UK?

After a quiet year for M&A in 2016, particularly in the FTSE 250, Neptune’s Holly Cassell believes we could be in for a much busier 2017.

UK M&A activity is really gathering steam, with new deals being announced at an encouraging frequency. In fact, we’ve had the best start to the year since 2008, with total inbound and outbound British deal activity reaching a nine-year high. This has been particularly prominent in the mid-cap space, which has seen the lion’s share of the activity so far.

Is this the beginning of a bubble? We would strongly oppose this view. 2016 saw only one mid-cap deal complete, with the owner of Argos being acquired by Sainsbury’s. The current momentum is the result of real pent-up demand in the system. Given these dynamics, we would expect to see M&A volumes in excess of market averages in 2017, particularly further down the market cap spectrum.

UK M&A Boom

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