Britain has become the most attractive M&A territory in the world for overseas businesses buying companies, according to professional services giant EY.

Last year, the UK knocked the USA off the top spot as the most attractive hunting ground for global acquisitions, despite Brexit uncertainty.

In 2018, the UK accounted for 10 per cent of global M&A, worth a combined $400 billion (£350 billion) — its second-best year since the financial crisis.

EY surveyed 2,900 executives in 47 countries — 68 of them chief executives, chief financial officers and other C-level executives.

Consumer products, retail, industrials and financial services were the most sought-after UK sectors.

US companies were the most enthusiastic overseas buyers of UK assets followed by German groups.

Sceptics say this is because of the relative weakness of sterling and comparative cheapness of UK company valuations given the uncertainty over Brexit.

However, EY global vice-chairman for transaction advisory services Steve Krouskos rejected this: “I know it seems counter intuitive, but I don’t think strategic buyers have been put off by Brexit uncertainty.”

Rather, said Krouskos, overseas buyers were aware of Britain having great talent, great technology and great intellectual property, he said.

Yet, in a sign of how uncertain British companies feel, acquisitions by UK-based companies of overseas assets fell by 55 per cent last year from £77.5 billion in 2017 to £22.7 billion in 2018.

Germany, China, France, Canada, India and Australia and Brazil followed behind the US in their hunger for British assets.

Despite what EY called “mounting geopolitical complexities”, the report found the appetite for global M&A was at a 10-year high. Ninety-three per cent of UK respondents expect the domestic market to pick up for acquisitions in the coming year and 96 per cent expect the global market to similarly improve over the course of 2019.

Almost six out of 10 global companies are planning to make a global acquisition in 2019, up from 52 per cent 12 months previously.