Mon, 13 Feb 2023 | BUSINESS NEWS
In an update on UK logistics and supply chain M&A activity, accountancy and advisory firm BDO has said dealmaking in the sector remains “lively”, despite dropping last year from the record levels seen during 2021. BDO’s report on logistics M&A showed that 17 deals were completed during Q4 2022, following three consecutive quarters of declining activity.
Overall, 62 deals were completed in the UK logistics sector last year, down from 66 during 2021, with total disclosed deal value standing at over £3 billion. Despite the fall from 2021, a year which saw a considerable amount of pent-up activity, BDO said that both deal volume and value remained strong.
The latest update highlights numerous trends currently influencing logistics M&A, with 60 per cent of deals being cross-border transactions (the highest figure since 2016) as more international buyers entered the sector, and a quarter of all deals during 2022 involving private equity backing.
Q4 saw several major deals, including DFDS’s £138 million acquisition of Northern Ireland-based haulage firm McBurney Transport and EFS Global Ltd’s acquisitions of Floryn Ltd and Eminence Transport Ltd. There were also three acquisitions of cold storage logistics firms during the quarter, as the UK’s food supply chain infrastructure became a more prominent consideration. This is a trend that has continued into 2023, with HSH Cold Stores’ recent £16.5 million acquisition of Associated Cold Stores & Transport.
Commenting on the findings, BDO M&A partner Jason Whitworth said: "Considering 2021 was bolstered by pent-up deal demand following Brexit, deal volumes last year reaffirm that the sector remains a lively one for M&A. Total disclosed transaction value fell in Q4, reflecting a shift to smaller deals. However, the annual deal value remained high, incorporating a number of high value transactions and reflecting the continued appetite for large scale consolidation."
"Whilst we continue to see strong appetite for strategic acquisitions and consolidation, the current uncertainty around the economic outlook and future financial performance is prompting more caution in the approach of buyers to value, with an increased focus on sustainability of earnings and margins. Aligning vendor and buyer expectations as to valuation remains key and higher valuations are narrowing in on the higher quality strategic assets."
In BDO’s latest annual Logistics Confidence Index with Barclays, the firm found that 45 per cent of logistics firms were planning to make acquisitions over the coming year, despite confidence falling within the sector, as operators looked to gain scale, expand their service offering and geographic presence and increase tech uptake.
Jason Whitworth said that Q4’s increase in activity bore this out and added: “We are anticipating that this strong deal flow will continue in the year ahead; however, with the uncertainties in the economy and the ever-evolving landscape, we anticipate that the mix in the nature and value of these deals will change."
Also read: the factors driving an influx of international buyers into the UK M&A market.
How companies can use M&A to tackle supply chain problems
Find businesses for sale here.
If you are looking for an exit, we can help!.
Presenting an opportunity to acquire a very profitable plumbers and heating merchants business operating nationwide.
Formed over 15 years ago the company prides themselves on being one of the largest suppliers of innovative clothing accessories to UK bricks & mortar and online retailers. Their expertise and ability to supply high quality, lingerie accessories and s...
The business operates as a leading supplier of professional vehicle sanitation products to trade customers. They have a loyal client base of 500 regular clients covering a huge area from the Northeast down to North Yorkshire.
26
|
Apr
|
Major double glazing firm Everest enters administration | ADMINISTRATION
Everest, one of the largest providers of double-glazing in t...
26
|
Apr
|
Kent-based scientific consultancy sold to US firm | BUSINESS SALE
A4P Consulting Limited, a scientific consultancy company hea...
25
|
Apr
|
Ambulance services provider acquired in pre-pack deal | BUSINESS SALE
Elite Emergency Medical Services Ltd (Elite EMS), an ambulan...
26
|
Apr
|
Kent-based scientific consultancy sold to US firm | BUSINESS SALE
A4P Consulting Limited, a scientific consultancy company hea...
26
|
Apr
|
Major double glazing firm Everest enters administration | ADMINISTRATION
Everest, one of the largest providers of double-glazing in t...
25
|
Apr
|
New private equity owner for fleet hire firm | BUSINESS SALE
West Lancashire-based fleet hire business NRG Riverside has ...
Business Sale Report is your complete solution to finding great acquisition opportunities.
Join today to receive:
All this and much more, including the latest M&A news and exclusive resources
Please choose your settings for this site below. For more information please read our Cookie Policy
These cookies are necessary for our website to function properly and provide you with access to all features.
These are analytics cookies that help us to improve the way our website works.
These are used to improve the functional performance of the website and make it easier for you to use.