Yorkshire deals market review in association with Grant Thornton
Recent headlines indicating that the volume of deals across the North of England has taken a downturn is not reflected in Yorkshire, which continues to experience buoyant activity levels, says Claire Davis of Grant Thornton in Sheffield.
The negative Brexit headlines have not yet rattled the confidence of investors looking to the Yorkshire market. Thanks to the weakening pound, the UK remains at the top of dealmakers’ list for European investment, the third globally behind the USA and China.
Whether this is set to continue in 2018 with the ongoing Brexit negotiations remains to be seen. But for now, corporates and private equity firms both at home and overseas are still willing to put forward capital to acquire the capabilities of UK businesses at a cheaper price. And, the rise in the Bank of England base rate, which is still at the lowest in 300 years, is unlikely to have a significant impact on the availability of funding.
In October alone, one fifth of the deals completed in Yorkshire were carried out by overseas acquirers. This healthy appetite for assets in the Yorkshire market from international parties is best reflected in last month’s most significant deal, which saw Australian private equity firm, AMP Capital, agree to acquire 100% of Leeds Bradford Airport from Bridgepoint Advisers.
The Sydney-based investment house has long had an interest in UK transport. Leeds Bradford Airport joins Newcastle airport in its international portfolio. AMP said it was excited about the opportunity, citing the airport’s strong growth prospects and the region’s position as a Northern economic hub as the reason behind its decision. This boost to our transport infrastructure, with its promise of further route development to new locations, will only make Yorkshire a more attractive proposition for future investments as we become more connected both nationally, through HS2, and globally via the air.
Elsewhere in the deals market, retail also saw significant activity in October. It was announced that the long-anticipated deal was approved with the Co-op taking over a 100% stake in Scunthorpe-based Nisa Retail, enabling it to strengthen its presence in the wholesale convenience sector, in a deal worth over £140m. Grimsby’s frozen fish processer, Seachill, is also set to be acquired by specialist meat-packing company, Hilton Food Group to a value of £80.8m.
As always, deal activity remains strong across the tech sector including acquisitions of Viking Management Systems by Innov8 Technology, facilitated by Grant Thornton; Exchange Comms by Leeds-based The Technology Group and Agility Multichannel by Magnitude Software Inc.
