Acquisitions at lowest level since 1992

Thursday, June 04, 2009 | Posted by: Grant Thornton
Categories: Financing | Tags: acquisitions, financial sector, government investment

Research from Grant Thornton revealed that in the first quarter of 2009 only 422 UK firms were the targets of mergers and acquisitions (M&A) transactions with a total value of £54.1 billion. At 53%, this is about half the number recorded in the first quarter of 2008, when 791 transactions worth £23.1 billion were announced. The latest figure is the lowest deal number recorded since Q4 1993, when UK business were the target of 404 M&A transactions with a total value of £7.1 billion.

Government investments in financial institutions drove total deal values in the financial sector to a new all-time high of £46.9 billion, with 51 deals announced.

David Brooks, Head of M&A at Grant Thornton, said: ‘We have seen a complete collapse of deals, as most CEOs dread calling the bottom of the market too early and overpaying on acquisitions. In this market you would expect the strong to eat the weak, but listed companies are cautious now.’