The special M&A relationship survives Brexit vote: US businesses continue to target UK deals

 
William Turvill
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The UK voted to leave the European Union on 23 June (Source: Getty)

US business, like the nation’s President, has retained faith in the UK after the Brexit vote, new mergers and acquisitions (M&A) figures released today show.

Deloitte’s Deal Monitor tracked 254 deals between the United States and the United Kingdom in the last six months of 2016.

Some 172 of the transactions were US-to-UK, a 3.6 per cent increase, according to the researchers.

Read more: After subdued 2016, these bankers are calling a 2017 bounceback for UK M&A

UK-to-US deals, on the other hand, fell by 20.4 per cent in the six-month period, Deloitte found.

“Widespread expectations of a collapse in US outbound dealmaking following the UK’s vote to leave the EU has not come to pass,” said Deloitte UK partner and vice-chairman Cahal Dowds.

“On the contrary, US buying of UK assets has outperformed the previous six months.”

London was the main target for US buyers, with 97 of the deals concentrated in the capital.

And the technology, media and telecommunications (TMT) sector was the busiest, with 37 per cent of the 254 deals concentrated in this area. Manufacturing was another active area in US and UK dealmaking, the Deloitte research found.

Read more: How boutiques have snatched bankers and M&A business from the heavyweights

Dowds added: “With record levels of cash on companies’ balance sheets combined with significant funds raised by private equity, investor appetite remains strong.

“The US is looking beyond uncertainty as the fundamentals of M&A have seldom been stronger. In this low economic growth environment, a key way to get increased revenue is to buy it. The quest for growth continues.”

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