According to latest figures released by KPMG this week, around half of MBO deals completed over the last three months have involved distressed companies.
The other interesting fact born out by the data is that average deal size has shrunk dramatically from the same period last year. The average MBO deal size over the past quarter was valued at £43 million, compared with £150 million in the third quarter of 2008.
However, senior KPMG partner, Michael McDonagh, said that he was surprised at the low number of distressed deals given how long the recession has had a grip on the UK economy. “The research shows that we are still some way off seeing the private equity market throw its weight behind distressed opportunities."
KPMG’s view for the next year? McDonagh is betting there will be an increase in deals starting this final quarter of 2009, followed by a further increase in activity early next year.
And what kinds of companies are going to attract the most attention?
According to McDonagh, “What some might describe as dull but dependable businesses with good earnings visibility, particularly with contracted revenues, are far more likely to attract debt support and therefore private equity bidders.”
This long-established arboriculture business, operating across Northern England and Scotland, offers a robust platform for growth with its secure portfolio of multi-year contracts and strong market reputation.
This established UK automotive logistics and workshop services business offers a unique opportunity to acquire a strategically positioned operation with proven financial performance, strong recurring revenues, and significant tangible assets.
This is an exceptional opportunity to acquire a highly reputable packaging and finishing solutions company in Ireland, known for its unparalleled quality and expertise in the carton production and converting trade.
Join today to receive:
All this and much more, including the latest M&A news and exclusive resources
We can help you capitalise on insolvent businesses. We list UK businesses in administration, liquidation and with winding up petitions daily. Ensuring our members never miss out on an opportunity
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.