North West M&As slip in volume and value during first half

Rainmaker Awards 2019

The North West saw a slightly slower first half of the year for mergers and acquisitions (M&A) compared with 2018, according to new research by consumer credit reporting business Experian.

Its latest report for the first six months of 2019 said the UK and Ireland experienced relatively subdued activity, although research manager Jane Turner said: “The overall environment for M&A remains reasonably healthy – the private equity market is still strong, funding is still readily available and interest rates are still low – and deals are still being made despite the turbulent outlook.”

The North West registered 393 deals in the six month period, around seven per cent less than the previous year’s total of 424.

Overall deal value was down by approximately 11% over the same period, with the recorded figure of £4bn being the lowest first half total seen for the region since 2012’s figure of £2.9bn.

Overall, the North West accounted for a little over 11% of all UK deals, but under five per cent of their total value.

Experian, which provided data for TheBusinessDesk.com’s North West Rainmakers 2019 awards at the Manchester Hilton in June, said deals of the half year included Ineos Enterprises Group, the Runcorn subsidiary of Swiss chemicals group Ineos AG, which acquired the North American business of Saudi Arabian titanium dioxide company National Titanium Dioxide Co Ltd for approximately £527m.

The business comprised two plants located at the Ashtabula Ohio (US) complex, and was seen by Ineos as a great opportunity to enter the pigments market by acquiring an already competitive business.

Manufacturing has been the region’s most active industry in 2019 so far, featuring in 98 deals representing approximately a quarter of the North West’s overall total.

Infocomms, which saw an increase in value over last year of more than £1bn to reach £1.3bn, was most valuable.

In fact, the report says, the infocomms industry was the only one to see an increase in both volume and value, also having seen a 1.3% rise in announced deals over the same period.

Construction saw the largest percentage growth in total value compared with 2018, up from just £48m in H1 2018 to £639m in H1 2019, despite also having seen a 23% decline in the number of announced deals involving the sector.

Excluding deals where the method of funding was not disclosed, approximately 41% (67) of all North West deals were funded at least in part by private equity.

This figure is roughly level with the H1 2018 figure where 40%, or 69, were funded in this way. Bank debt has also seen a proportional increase, with 63, or 38%, of deals having received some sort of bank funding, up from 53 and 31% at the same point last year.

The title of the North West’s busiest legal adviser in 2019 so far fell to Knights, with the firm having advised on 23 deals in the region so far.

In second place was Gateley on 17, followed by Hill Dickinson on 16.

As the only legal adviser to break the £1bn mark, Addleshaw Goddard led the legal value table by some way on £1bn, with the next closest firm being Ashurst on £647m.

Grant Thornton topped the financial volume table on 19, with the region’s Q1 leader, Dow Schofield Watts, in second place on 15.

AIM adviser Peel Hunt has now moved to lead the financial value table outright, on £969m, after having been in three-way tie for first at the end of the first quarter.

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