News & Deals
The annual M&A Review, compiled by Experian MarketIQ, was released last week detailing UK M&A activity for 2023. As usual, we take a deeper look at the numbers and pick out the positive highlights that will help to navigate the M&A landscape for the coming months. To compare year-on-year figures for deal volumes and values isn’t going to produce anything we don’t already know. Nearly all sectors felt the pinch in 2023 and witnessed a decline in activity in some form. Where we believe the figures get interesting is when we look back a little further, comparing pre & post pandemic. This provides a much broader view of how each sector has grown or contracted which can help when looking forward or making plans to sell at the right time. With these latest figures we can compare a full five year period, so let’s get started… UK DEALS BY VOLUME - LAST 5 YEARS
The M&A industry trades in data and insight. So, there's an element of irony in that general opinion is summized by a limited amount of available information. Reading many articles in 2023 about the state of play in the M&A industry, and you will hear that high interest rates have made borrowing expensive, subsequently slowing the post-Covid surge in deal volumes and values. While the picture painted isn't all doom and gloom, the information used in this reporting is often limited to knowledge of the biggest deals at the top end of the market. What about the rest of the M&A markets? In a recent white paper offered by Fintech titled " The Next M&A Frontier: Navigating the Untapped Potential of the Lower Middle Market " there is a deeper dive into what is happening from both the purchasers and sellers perspective. The lower mid market (£5M-£150M revenues) accounts for around 30 times more companies than the top end (£150M+ revenues). Given the economic reasons impacting investments and borrowing, the focus for many purchasers and fund managers is to now look beyond the top 3 players in a sector and instead adopt a systematic 'buy-and-build' M&A strategy. Within the white-paper a survey was carried out detailing buyer interest (number of approaches made), and a separate survey of seller interest (willingness to have a conversation with an acquirer). When overlaying the results, the companies with the highest number of approaches ($50-100M revenue range), were the least willing to engage in conversation. Instead it was the $20-50M revenue bracket of companies that were more open to entertaining the idea.
The latest Experian Market IQ Report was published recently, detailing UK M&A activity for H1-2023. At first glance, the reporting doesn't look too encouraging but the lack of 'mega deals' (worth £5bn+) is a huge contributing factor. Let's look at the numbers... With inflation and rising interest rates hitting the headlines on a daily basis, it's no surprise the impact this would have on the UK M&A market as a whole. At the larger end of the market there have been significantly fewer transactions and lower deal values being achieved during H1. Let's look at Volume and Value by industry below:
The latest Experian Market IQ Report was published recently, detailing UK M&A performance and activity for 2022. We've crunched the numbers and looked back a little further to help measure where we're currently at... Forecasters have had a torrid time predicting merger & acquisition trends recently. As the world attempted to recover from the pandemic, we've had the impact of a European war, plus a global energy crisis to contend with, making it even harder to predict spending and investment. As we approach the end of Q1 2023, we know the final figures for 2022. Was it a good or bad year? Can we simply measure against 2021? 2021 was the year that M&A bounced back post-pandemic, with investors keen to acquire companies in the mainly unaffected sectors (health, tech, and financial/support services). Additionally, 'pre-pandemic agreed' deals were able to complete and this burst of investment activity was unlikely to be sustained. Not a great yardstick to measure 2022 against! We've taken these figures for 2022 and put them alongside figures going back to 2019 to compare against pre-pandemic levels to get a deeper understanding about where we've come and in what direction we might be going. Let's delve into it... UK DEALS BY VOLUME
La Salle detail expansion plans for 2023 with prime Didsbury premises acquisition. La Salle Corporate are capitalizing on a successful 2022 by growing the organisation and relocating the company to a prime trading location in the heart of the leafy suburb of Didsbury Village in south Manchester. After a record year in 2022, La Salle Partners Matt Dillon and Sarah O’Reilly have chosen to reinvest the profits into purchasing the site at Xenon House (formerly Alan Gregory Musical Repairs). La Salle have operated from their Stockport HQ for over 10 years. Exciting plans for the site include a conversion to two-storey office premises, presenting commercial space rental opportunities. Additional plans include a modern boardroom with bar and terrace area for hire to local companies seeking a private meeting space with a social element. Renovations at the new site are expected to be completed Spring/Summer 2023. Matt Dillon, Partner at La Salle Corporate added: “We are very excited by our new offices. When the site came to the market, we knew we would never find a better location. We want to grow our team and feel that new, refurbed offices will help us attract talent from the North West area. We are excited by the future of La Salle and hope to see many of the Corporate Finance community visiting us at the new office – especially on a sunny Friday afternoon!” More details to follow in the coming weeks and months!
La Salle Corporate are helping to raise money for the Manchester MIND charity via our JustGiving page . Your donation to the charity can really make a difference, and for every donation received over £10 you will be entered into a raffle prize draw to win an unrivalled match-day experience watching Manchester United in the La Salle Corporate box at Old Trafford. A note from Manchester Mind: Manchester Mind is an independent, local charity, which supports over 7,000 children, young people and adults each year. We believe that everyone deserves to be supported in their mental health needs and we have a part to play in that. Our charity values the commitment of our staff and volunteers, who work hard to ensure services are delivered in a way that enables people to feel heard and involved. THE PRIZE: The prize is a corporate match-day experience for up to six people in the La Salle Corporate box at Old Trafford, hosted by La Salle. Watch a Manchester United game* and enjoy panoramic views of the pitch, a four-course choice meal, complimentary bar, and pre-match entertainment. HOW TO ENTER: The minimum donation to be entered into the raffle is £10 but you can always donate more! Closing date for the raffle is 12:00pm (noon) on Friday January 27th 2023. The winner will be chosen at random and notified via email on the same day. IMPORTANT: Remember to enter your name & email address when donating so we can contact you if you win the raffle! *Fixture to be decided based on availability of winner.
A quick look back over a successful last 12 months... For a small team working in a big industry, we pride ourselves on working closely with and getting to know our clients (many become good friends!). As a result, we are very proud of our achievements in 2022. Entering 2022, off the back of the pandemic, the war in Ukraine, and the subsequent energy crisis presenting challenges to the global economy, there was naturally a level of hesitance from sellers and investors. We went back to basics, focusing on what sets us apart from the competition: taking the time to get to know our clients, really listening to them, and acting on their specific requirements. Offering this level of reassurance and guidance in times of uncertainty has paid dividends, not only for us but has achieved maximum value for our clients. We have agreed on a record number of deals , and completed several high-value transactions for our clients in 2022, more than any previous 12-month period. Despite dips in volumes and values of Manufacturing deals across the UK in Q3 2022, we have performed strongly within the sector. Manufacturing sector deals accounted for two-thirds of completed transactions for our clients. Highlights include the double-header deals of leading UK stretch-film companies Eurofilms and Quality Films to Swedish plastics giant Trioworld, backed by Altor Equity Partners. Sandwiched between these deals, we advised on the acquisition of IT support firm Technique by Cybit, the parent company of Perfect Image, backed by Chiltern Capital. In recognition, La Salle Partner Matt Dillon was nominated for Finance Professional of the Year in the Manchester Young Talent Awards in October. In addition, we have successfully agreed on several deals due for completion in early 2023. We have plenty of reason to look ahead to the new year with optimism. Any company owner considering exit strategies or disposal in 2023 should remember that exiting a company isn't simply an accounting or legal process. With all company sales, to achieve the maximum value, a level of understanding is required to undertake a focused sales & marketing process. This process is tailored and applied individually to each company and ownership structure. It is the main contributing factor to our continued success. If you would like to discuss exploring your exit options in 2023, you can reach out any time over the festive period or download our Free Guide to Selling a Company . Have a great Christmas and New Year! All the team, at La Salle Corporate.
What effect does a global pandemic, a war on European soil, and the subsequent related inflation have on the UK M&A market? Let’s find out! With so many outside influences on the M&A market in the last couple of years it has been difficult for forecasters to predict trends and assess investor confidence. Fortunately, the good folk at Dealsuite prepared a report surveying 327 M&A advisory firms operating in the UK & Ireland M&A market and compared the data from H1 2022 with H2 2021. We picked out some of the highlights: TRANSACTIONS Which sectors accounted for the total number of transactions? There weren’t any significant changes or surprises here. Core sectors such as Healthcare & Pharmaceuticals and Agri & Food saw increases, so did Automative, Transportation & Logistics which is another encouraging post-pandemic sign. What might be most surprising is that Hospitality & Tourism and Retail Trade, sectors both dealt heavy blows by the pandemic, only saw minimal decreases (-1% and 0 respectively). With these sectors likely to be hardest hit by the rising inflation and energy costs, it’s worth keeping an eye subsequent reports. Transactions per sector.
La Salle are delighted to announce the sale of Wolverhampton-based stretch film manufacturer Quality Films Limited to European plastic packaging group Trioworld. This is the second deal this year La Salle advised on involving the Swedish-based acquirer. Overview: Quality Films Limited are a key player within the UK market, producing high performance industrial and consumer packaging films and have a 35+ strong workforce. Following the conclusion of a deal in March 2022 which saw La Salle advise Eurofilms in their sale to Trioworld, Matt Nicholson of Quality Films approached La Salle with a view to finding a buyer for the company. A full process was undertaken, and a number of potential acquirers sourced from across Europe, the US and Asia. Given the existing relationship formed during the Eurofilms deal, Trioworld emerged as the front-runners with the Swedish group looking to further broaden their portfolio and establish dominance in the market. The deal took under 5 months to complete, a month shorter than the Eurofilms deal. Matt Dillon, Partner at La Salle Corporate commented: "Having sold Eurofilms earlier in the year, we knew that the stretch film market was a buoyant sector. Quality Films is a well-established, reputable firm in this space so we were delighted to work with them. It was a pleasure to advise Matt, his family and Sonia on the deal. Trioworld was an obvious home for the business having acquired their competitor earlier in the year. I wish the business and the shareholders every success in the future." Per Holtstrand, Divisional President of Stretch Film Division at Trioworld said: "With our joint forces, we will continue to develop in the UK market with focus on sustainable high-performance solutions for load security.” Matt Nicholson, CEO of Quality Films added: “Trioworld will help to take the Quality Films brand to the next level and build on the foundations we have laid since 1994. Combining our experiences will be hugely beneficial for customers as we can deliver better quality and value, something we have strived for since day one.” Trioworld Group CEO, Andreas Malmberg, comments: "I’m very happy that Quality Films will join our journey in developing the best circular offering in the market for recycled plastics. Quality Films superior commitment to innovative products and customer support in UK gives a fantastic platform for enhanced growth.” Company Profiles: Quality Films Limited – Wolverhampton, UK (https://www.quality-films.co.uk) Formed in 1994, Quality Films are an independent manufacturer of pallet stretch film, based in the heart of the Midlands (UK). Operating from a 30,000 square foot premises, the company distribute to the UK and Europe and have over 260 active customers. Trioworld (backed by Altor Equity Partners) - Sweden Group consists of 16 companies, 1,400 staff, and generates a €750m turnover. Operates facilities in Sweden, Denmark, the Netherlands and France. Offers a wide range of plastic packaging solutions. Backed by Altor Equity Partners since March 2018. Deal Advisors: Buy-side Trioworld: Legal: Oliver Duke at Walker Morris Legal: Anders Luckander & Daria Yan at Mannheimer Swartling Sell-side Quality Films: M&A: Matt Dillon at La Salle Corporate Legal: David Mkhitarian, James Down, and James Redshaw at Hill Dickinson LLP Read more about this deal around the web: (La Salle have no control over content published on external links) Insider Media MyNewsDesk
