Private equity investors completed a total of 40 deals in British companies between the £10m and £100m mark in the first half of 2016, according to data released today by the Lyceum Capital and Cass Business School UK Growth Buyout dashboard.
This compares to 35 deals that were completed during the first six months of 2015.
The research also indicated that activity has not abated since the UK referendum on EU membership, with a further 10 transactions having completed since 23 June.
“The UK lower mid-market is set to shine again as a beacon of attractive investment opportunities, with the deepest pool of entrepreneurs and the strongest tech and digital economy hub in Europe,” said Andrew Aylwin of Lyceum Capital.
Nevertheless, Aylwin remained cautious on the prospects for the rest of 2016: “Volumes in H2 are likely to be lower than initially expected as investors assess targets’ prospects in this ‘New Normal’,” he said.
However, Scott Moeller of Cass Business School was positive that deal-making would not freeze completely in the second six months: “While it is still too early to predict the extent to which Brexit will affect the lower-mid market in the UK, we believe this portion of the industry is well placed to benefit from the new environment.
“Given the asset class’s strong performance and track record throughout the years, we believe that lower deal prices could also signal an increase in foreign investment, giving the industry even more scope and capability,” he said.
Separate figures released yesterday by Prequin on all UK private equity buy-outs also indicated that the Brexit vote had not deterred dealmakers.