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UK Fact Sheet

02 Apr 2012

The UK buyout market has reclaimed its position as the most active country in Europe, recording close to half of all European deals in both value and number for the first quarter of 2012. The UK recorded 62 deals with a total value of £5.2bn, accounting for 48% of the overall value across Europe (€13bn). This compares with the final quarter of 2011 when deal value only reached £2.7bn - the first time that the UK dropped lower than France in terms of the value of deals completed.    

Sectors  

The most active UK buyout sector was Business & Support Services which totalled £1.3 deals through 13 transactions. This is already nearly half of the overall value recorded in the sector in the whole of 2011 (£2.5bn).

The Retail and Manufacturing sectors were also strong in Q1 2012 totalling £1.6bn with seven deals and £1bn with 11 deals respectively.  

Source  

The number of buyouts out of insolvency is increasing in the UK indicating an improving confidence in buying distressed companies. Nine insolvency transactions were completed in the UK in Q1 2012, including the acquisition of struggling UK retailer Comet which was bought out of administration by OpCapita in January for an estimated €2. This compares to just 16 insolvency buyouts in the whole of 2011.

Secondary buyouts in the UK remained the strongest source for private equity deals by value with 13 deals totalling £2.3bn – almost half of the overall value of secondary buyouts in 2011 (£5.5bn).  

Small deals  

Q1 2012 saw an increase of small deals (below £10m) in the UK, with 30 buyouts completed compared to 69 in the whole of 2011.  

Exits and pipeline  

The overall value of UK exits in Q1 2012 was £3.3bn - more than double the combined total of the third and final quarter of 2011 (£761m and £783m respectively).

Of the 40 exits completed in the UK in the first quarter of 2012, 10 (25%) were creditor exits, 16 (40%) were secondary buyouts and 14 (35%) were trade sales.

The overall pipeline for transactions in the UK is looking strong, with a number of high profile pending deals such as the possible acquisition of banking software provider Misys PLC by Vista Equity Partners and CVC Capital Partners, and the sale of HMV Live.    

Regional buyout activity  

London failed to regain dominance after a slow 2011, when the overall value of buyouts completed fell to £4.6bn from £9.8bn in 2010. This quarter, the total value of deals in London was £956m, which compares to £1.6bn in the North West of the UK and £1.1bn in the South West. However, London led the UK buyout market this quarter by volume of deals (15).

Private equity buyouts in the South West region have increased significantly by value and volume this quarter. 11 deals in Q1 2012 equated to £1.1bn, already more than three times the overall value in the region in the whole of 2011.

The North West of England was the dominant region in the UK in Q1 2012 with £1.6bn of deals recorded. This is already 91% of overall value of deal flow in the region in 2011 (£1.8bn).  

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