Overseas interest fuelling activity in East Anglian M&A marketplace
ARCHANT EASTERN DAILY PRESS (01603) 772434
The deals market in East Anglia remains buoyant and overseas interest in its companies is high despite economic uncertainties.
This is the view of an accountancy and advisory firm ranked as the region’s most active financial business in the mergers and acquisitions (M&A) market.
Over the past three months Grant Thornton has supported two major deals in Suffolk. In March it advised H Erben, a packaging supplier to the wines and spirits sector in Hadleigh, on its sale to US-based rigid packaging supplier Berlin Packaging.
It also supported Bury St Edmunds-based Treatt, supplier of ingredients for the global flavours and fragrances industry, on the £11m sale of its subsidiary Earthoil Plantations to Univar, also headquartered in the US, in May.
Meanwhile in Norfolk it advised on the sale of Robinsons Motor Group’s five Mercedes-Benz dealerships and three Smart dealerships to US retailer Group 1 Automotive, which was completed in March.
Tim Hansell, director of corporate finance at Grant Thornton based in its Norwich office, said the marketplace in Suffolk in particular was “very active” – despite industry figures indicating otherwise.
Data from Experian MarketIQ for the first quarter of 2018 showed M&A activity across the East of England fell 31% to 115 deals compared with 166 in the same period last year, while the total deal value dropped by 80% to £2.3bn.
But looking ahead to the rest of the year, Mr Hansell expects the mid-market – “which is more relevant to East Anglia” – to remain healthy as larger “mega-deals” suffer from a lack of clarity over Brexit.
Mr Hansell said: “Local companies are looking to de-risk and sell businesses or assets while the tax environment remains favourable, further fuelling market activity, while strong availability of funding support is encouraging ambitious, first generation businesses to go for growth.”
Overseas interest in the region’s firms remains strong, he said. “Ongoing uncertainty around Brexit continues to present challenges but it is also driving greater interest from overseas buyers, particularly from the US, who are attracted by the favourable exchange rate which is making it cheap to buy UK assets.”