M&A activity in quarter shows big drop

The number of mergers and acquisitions fell by 20.6 per cent during the last quarter of 2010 when compared with the same period the year before, according to research published today by global information services company Experian.
By The Newsroom
Published 6th Jan 2011, 11:26 BST
Updated 6th Jan 2011, 11:26 BST

The volume of deals for 2010 was 4,240, which was 4.5 per cent fewer than the total number for 2009.

Wendy Smith, the business development manager at Experian Corpfin, said: "While overall deal volumes have decreased in the fourth quarter and year-on-year from 2009, the overall trend since the third quarter of 2008 has been relatively flat.

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"It remains to be seen if deal volumes have found a new level at which they will remain or whether the decline will continue, or indeed whether we will see an upturn in 2011."

During the fourth quarter of 2010, the UK saw a 12.5 per cent decrease in the number of UK merger and acquisition and ECM (flotation, rights issue and placements) transactions announced, compared to the third quarter of 2010, from 1,050 deals to 919.

There was also an 18.43 per cent fall in the value of transactions to 52.91bn.

In Yorkshire, 64 deals were announced in the fourth quarter of 2010, compared with 73 in the previous quarter. The most improved region in the UK was East Anglia with a percentage increase of 31.4 per cent in deals over the last quarter of 2010.

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The worst performing region was Wales where deal activity dropped by 44.1 per cent.

The value of mid-market mergers and acquisitions (M&A) rose in the UK during 2010, according to research released yesterday by professional services firm Grant Thornton.

Grant Thornton analysed transactions with a value of up to 500m.

Last year, there were 2,163 deals with a total value of 38.9bn, which represents a 66 per cent increase in the total value of mid-market deals compared to 2009.

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Ian Marwood, the head of lead advisory for Yorkshire and the North East at Grant Thornton, said: "The number of UK merger and acquisition deals dropped off in the second half of 2010 as uncertainty gripped the market once again and economic recovery looked likely to be a long slog. Nevertheless, valuations rose steeply in 2010 fuelled by private equity and foreign bidders.

"The increase in the total deal value of mid-market M&A is sustainable as quality assets continue to fetch premium prices."

Related topics:Grant ThorntonWalesYorkshire