UK M&A activity is picking up following the US markets. Whilst to date the uplift in values has been restricted to the larger end but it will filter down into the SME market. UK and foreign corporates have cash, PE Houses have cash and banks are lending. What's there not to like about that?
Buyers paid record valuations for US takeover targets, as merger and acquisition activity soared to unprecedented levels in the first half of the year, surpassing the debt-fuelled run before the 2008 crisis. A heady cocktail of ultra-low financing costs and a search for growth across sectors propelled US M&A activity up 60 per cent to $987.7bn, the strongest first half since records began in 1980. Global M&A in turn rose 38 per cent compared with one year ago to $2.18tn in the first half, the highest since 2007, according to Thomson Reuters data. The average deal valuation — a key measure of how much buyers are willing to pay — rose to 16 times earnings before interest, taxes, depreciation and amortisation, beating the previous high of 14.3 times in 2007.