Brexit drives foreign buyers to UK
While the data from Thomson Reuters shows that domestic UK dealmaking underperformed - there were only 1,355 domestic deals - Britain was saved from any ‘M&A collapse’ by foreign buyers on the hunt for good deals.
British M&A activity totalled $177.5 billion (£144 billion) in 2016, some way below the record $394.8 billion reached in 2015 - but still “in line with the longer five-year trend”, Reuters said.
Inbound M&A reached $143.7 billion and domestic M&A was $33.7 billion as the UK kept its place as the third-largest market for deals after the US and China.
Reuters said the rise of the foreign buyer was a clear trend, citing Rupert Murdoch’s 21st Century Fox takeover of British broadcaster Sky for £11.7 billion.
"Brexit should never have been talked up as an Armageddon moment for UK M&A, especially with such a sharp devaluation in the currency which has clearly been a stimulus for overseas buyers," Tim Gee, an M&A partner at law firm Baker & McKenzie, told Reuters.
"Much of the activity in 2016 was skewed towards foreign buyers with less UK-to-UK activity," Mr Gee added.
"Total activity levels were not really knocked that much by Brexit but who was doing the buying did shift - deal values in 2016 are very similar to the historical trend."
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