The value of the UK’s private equity buyouts has risen 23 per cent so far this year to £15.7 billion from £12.7 billion in 2011.
The value of the UK’s private equity (PE) buyouts has risen 23 per cent so far this year to £15.7 billion from £12.7 billion in 2011, making it the most bankable PE market in 2012.
The number of deals recorded rose slightly to 189 compared to 187 over the same period.
Average deal size in the UK has also increased to £84 million, up from £68 million, according to the latest data published by the Centre for Management Buyout Research.
The number and value of foreign divestments saw a marked increase this year, rising to 19 deals and £1.9 billion compared to 15 and £1 billion in 2011.
Of the overseas acquirers, 13 of the businesses originate from the US, with these deals alone equating to £1.7 billion.
Sachin Date, private equity leader for Europe, Middle East, India and Africa at Ernst & Young says that UK buyout activity has shown real resilience in the face of macroeconomic uncertainty.
‘The PE market in the UK is being buoyed by the relative safety that Sterling offers in light of the Eurozone crisis and has helped to make it the most bankable PE market in Europe this year,’ he adds.
‘PE funds are growing increasingly worried about how the Eurozone crisis will play out and as a result the UK has benefitted and held up well compared to Europe.’
Christian Marriott, partner at Equistone Partners Europe says, ‘The UK market’s resilience is in part due to the willingness of the banks to offer financing for quality assets with promising growth potential.
‘A handful of new entrants are increasing liquidity in the market and a few senior lenders are even considering underwriting again. This confidence and increased access to finance should further boost deal flow, allowing the UK to sustain a good level of activity into 2013.’
Buyout numbers as a percentage of UK M&A have risen to 45 per cent in the first nine months of this year, compared to 33 per cent in 2011.
Exits have fallen in 2012, from 162 in 2011 to 134 but values are higher at £15.2 billion compared to £9.7 billion last year.