M&A market update: April normality after record March

M&A market update: April normality after record March

March 2021 saw the highest volume of M&A transactions recorded in a single month in the UK, with 653. The fear of a capital gains tax hike, coupled with enhanced confidence of improved economic performance post lockdown, saw the market spike to levels previously unheard of.

Transaction volumes reported for April 2021 have undoubtedly returned to normal but still show strong activity across most industries.

The headlines

The biggest reported deal of the month was Melrose Industries’ disposal of Nortek Air Management to Madison Industries for approximately £2.6 billion.

IT and Financial Services continue to be the most in-demand industries, attracting the highest deal values.

Transaction volumes and prices appear to be driven up by demand. This is likely due to readily available cheap capital and growing economic performance.

This trickle-down effect is allowing the large players access to significant funding to reinvest through acquisition. This is unmistakably clear in the mid-market, with consolidators the most aggressive movers in a variety of industries amidst generally high competitive tension.

East Anglian view

Local deal volumes for East Anglia remain buoyant, as they have been throughout the start of 2021.

A growing number of inquisitive acquirers continues to push up premiums on profitable businesses. Those with strong recurring revenues or “sticky incomes” appear to be the flavour of the month across most industries. Even Hospitality, Leisure and Retail has started to gather momentum following a difficult 18 months.

Are you considering your exit options? Are you actively looking for a business to acquire? Or just want to find out more about the M&A market for your industry and area?

Get in touch with your usual Larking Gowen contact, or Will Gibbs, Corporate Transactions Executive (see the Our People section of our website). Call 0330 024 0888 or email enquiry@larking-gowen.co.uk.

Data and graphs provided by MarktoMarket – find out more here.

Will Gibbs