Deal-doers positive as public markets return to fashion
AN upturn in confidence among corporates, an improvement in banks’ appetite to fund, and the return of the IPO market, were the key topics for debate among the region’s top deal leaders.
Altium’s Adrian Reed, Deloitte’s Paul Lupton, Tim Morris of EY, KPMG’s Jonathan Boyers and Andy Parker of PwC were panelists at pro.manchester’s Corporate Finance lunch at the Hilton Hotel on Thursday.
Quizzed by pro.manchester chief executive John Ashcroft, there was consensus that sentiment has turned a corner.
Jonathan Boyers said: “I’m in a positive mood, we are seeing owner-managers who have been thinking about selling for some time starting to make decisions and as a result our pipeline is building quite nicely.”
Andy Parker from PwC said he had noticed a pick-up in activity in the final quarter of 2013: “We saw businesses taking a view after last summer that things need to start happening. This positivity and desire for growth will create more deals.”
Tim Morris of EY – who moved back to the region from London last year from the firm’s London office, said he was surprised by the number of IPOs in the pipeline.
“We have five across the North this year – I don’t think there have been five in the last five years. It’s a big window at the moment and is proving to be an exit route for vendors.
Adrian Reed said the IPO market is being driven by strong institutional appetite: “They are going to have £60bn to £80bn back in dividends from the likes of Vodafone, which they’ll be looking to invest.”
Paul Lupton from Deloitte said while deals are generally being completed more quickly than at any time during the recession, there still remains an element of caution among acquirers.
He said there was a flight to quality and scale in the debt market, with banks more happy to lend to corporates earning £10m EBITDA, than those below this level.
Analysis by pro.manchester and Experian Corpfin and New Economy found that in 2013 Manchester-based advisers were involved in 260 deals, worth £3.3bn – the largest deal being Manchester Airport Group’s £1.5bn acquisition of Stansted Airport.
