Fewer, But More Valuable M&A Deals in 1Q11, According to Experian

The number of mergers and acquisitions (M&As) during January, February and March this year fell by 18.73%, compared to the same period in 2010, according to Experian, a global information services company. Despite the fall in volume, Experian’s latest M&A and equity capital market (ECM) data has also revealed that the value of deals during 1Q11 increased – up 5.94% compared to 1Q10.

UK Highlights

  • During 1Q11, UK deal volume fell from 1,153 in 1Q10 to 937 and deal value increased from £45.3bn to £47.98bn.
  • Compared to 4Q10, the UK saw a 9.1% decrease in the number of UK M&A and ECM transactions announced, (from 1,031 deals to 937 deals), and a 9.8% fall in the value of transactions from £53.2bn down to £47.98bn in 1Q11.
  • The most improved region in the UK was Wales with a percentage increase of 68.2% in deals compared to 4Q10 and 42.3% compared to 1Q10.
  • The worst performing region was Northern Ireland where deal activity dropped by 25% compared to 4Q10 and 62.5% compared to 1Q10.

Europe and the Rest of the World

  • Europe saw a 15.5% decrease in European M&A and ECM transactions announced during 1Q11 with 2,192 deals compared to 2,594 transactions in 4Q10 and a 5.81% fall on the €209.4bn recorded in 4Q10 to €197.25bn worth of transactions announced in Europe in 1Q11.
  • Compared to 1Q10, Europe saw the volume of deals fall by 27.68% from 3,031 to 2,192 deals. The value of deals increased from €185.2bn in 1Q10 to €197.25bn – up 6.51%.
  • The majority of the UK’s deals during 1Q11 were with the US, followed by Australia.
  • In the US, volumes were down in 1Q11 by 10% while values were up by 12.84% compared to the previous quarter (4Q10).
  • Asia Pacific witnessed declines in both volume and value during 1Q11 by 22.8% and 34.78% respectively.

Wendy Smith, business development manager at Experian Corpfin, said: “This year hasn’t yet brought the rise in deal activity many had hoped for as appetite for higher risk, high return proposals remain low. However, the UK still fared a slightly better than the rest of Europe. Within the UK, we have seen some regional pockets that out-performed the national trend. Wales, the northwest of England and Yorkshire all saw an increase in the volume of deals quarter-on-quarter.

“This shows that those businesses that present good quality opportunities are still finding the funding to get deals off the ground. It is vital that businesses take the time to prepare and ensure all their documents are in order and accurately reflect their position, before presenting their investment plan in order to have the best chance of securing funds,” she added.


Related reading

New consumer banking head for Citi Asia Pacific