What does the future hold for M&A?
Boris Johnson resigned as leader of the Conservative Party and at the time of writing, we are down to two candidates vying for the top job.
Apart from Rishi Sunak, the candidates who stood for the position promised tax cuts or to reverse tax increases. Against this political backdrop, there is a cost-of-living crisis; UK inflation jumped to 9.4% in the 12 months to June 2022 (according the Office for National Statistics); tens of thousands of rail workers are holding the biggest strike for decades and the proposed pay rise of 4.5% for NHS staff and 5% for teachers has been met with disdain, with talks of strikes ahead.
As if all this is not enough, we had to endure the heatwave from hell causing havoc to the transport system and devastation in some areas. Remarkably, not one of the contenders in the leadership contest had climate change on their agenda. Covid has not gone away, nor is it likely to in a hurry. Private sector staff expect higher pay rises and the shortage of resources in some sectors is forcing business owners to increase pay to retain and attract staff; this in turn means price increases.
We don’t know whether the next PM will be one who favours tax cutting or one who sticks to the current strategy, what we do know is that tax cuts will plunge the country into further debt.
This may sound doom ridden, but we are living in a time of volatility on several fronts, with most businesses having had a challenging year so far, and it looks to stay that way for a while.
Watch this space……
Equity investment market update – Q1 2022
A record £8.79BN was invested in private UK companies during the first quarter of 2022, across 769 rounds according to a report published by Beauhurst. Whilst the deal volume remained the same as Q1 2021, it is interesting to note there was a 58% increase in deal value. Over half of deals went to London-based companies, accounting for 61% of all pounds invested and 53% of the number of deals. Fintech continued to dominate the market, while cleantech took 26p in every £1 invested. UK’s high growth ecosystem looks like it is on track for a record-breaking year.
Alliotts M&A: we’re seeing a high level of activity
Alliotts’ M&A team been active with M&A assignments over the last six months with no evidence of slowing down. We have advised on, or are advising on, acquisitions as well as disposals with deal values in the £5m – £100m range. Covid has was a wake up call for a some business owners that there is life beyond work, and these have taken the plunge to sell. Conversely, we have had business owners who built a war chest over the pandemic years and are now keen to expand and are looking to buy. And then there are others who have simply been approached with an offer that was far too good to refuse!
Our team of business advisors, tax specialists and accountants are working with entrepreneurs active in a wide range of sectors, helping them to maximise their investment in their business. We’re talking to clients on business valuations, exit and succession planning, and acquisitions. With changes at Government level many clients are putting tax planning strategy at the top of their agenda and talking to us about their options.
Please do get in touch with if you would like a confidential chat about your future business and personal plans.