The second half of 2018 saw a rise in M&A activity within the UK mid-market, with a buoyant market and favourable tax benefits for shareholders supported by a 70% increase in acquisitions of UK-based companies compared to the same period of 2017.
KBS Corporate is experiencing first-hand a growing confidence and sentiment amongst Trade and Private Equity acquirers across the globe, advising on 21% more transactions in 2018 compared to 2017 and outperforming the wider Mid-Market in general.
UK based trade acquirers have continued to show signs of increasing activity, and we often discover that they are releasing cash reserves that they have maintained over the past decade. These reserves are now being invested in order to facilitate growth initiatives, with many choosing a policy of growth by acquisition rather than aiming to achieve organic growth. As a result of this, KBS Corporate has seen the average number of monthly buyer enquiries increase by a third in the second half of the year, with buyer meetings and offers received both increasing by 20%.
Additionally, many Private Equity groups are fuelling the activity by completing deals with the billions of funds raised over the last five years as they seek to invest in companies that have demonstrated sustainable profits and growth throughout the global economic downturn. This has resulted in an increase of 56% in the number of transactions between UK based sellers and private equity houses in H2 2018 compared to H2 2017.
The increasing level of activity is also reflected in the number of deals involving acquirers from overseas, which has seen a 34% increase in H2 2018 deals compared to the same time period of 2017. KBS Corporate expects this to continue to increase even further throughout 2019.