Shorts have again sponsored the Sheffield Star Top 100 City region survey. At the time of completing the Sheffield City Region Top 100 Companies this time last year, we undertook a review of the last 12 months’ deal activity of the top 100 firms. Our conclusions then were that the growing confidence of these businesses had been translated into deal activity. Several companies had made significant acquisitions or had taken advantage of the favorable funding market to raise finance to support their future plans.
Roll forward 12 months and we have again reviewed the deal activity of the Sheffield City Region top 100. The background to our review is that the last year has seen a very active local mergers and acquisitions market. Figures from the office for national statistics also show that there were £187.4 billion of successful inward mergers and acquisitions transactions in the UK in 2016. This UK figure is the highest value since the data was first published in 1969.
So, with a backdrop of an active deal market nationally and locally we would expect to see a significant level of mergers and acquisitions activity being undertaken by the top 100. It is perhaps therefore slightly surprising that these businesses have not been involved in quite as many transactions as we would have predicted.
The top 100 firms were only involved in 6 transactions over the last 12 months, 3 being UK acquisitions and 3 being overseas acquisitions. The stand out transactions from these were two overseas acquisitions by Benchmark holdings for a combined value of £63m and the £20m acquisition of NR Evans by NFT Distribution Holdings Limited.
Personally, I don’t think we should perhaps read too much into this relative lack of deal activity. Firstly, whilst there may have been a relatively small number of transactions it is worth noting that all the transactions involved acquisitions by the top 100 - this does imply companies confident enough to significantly invest in their future growth. The high levels of activity in the previous year are also likely to have had a dampening effect for these businesses as they take time to integrate acquisitions before looking to buy again.
The financial results of the City Region top 100 look strong, and if we combine this with the active current mergers and acquisitions market then I would fully expect the next 12 months to show the top 100 businesses involved in further significant deal activity.
To view the Sheffield City Region Top 100 summary, please click here.
Tags: Corporate Finance, Business News
