Post Brexit M&A activity beats expectations, EY data reveals

10 October 2016

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  • Overall value for UK M&A reached $78.3bn and 705 deals in Q3
  • Since the start of the year M&A value has seen activity worth $159.8bn and 2,252 deals

The value of UK M&A in Q3 of 2016 increased from the previous quarter, despite Brexit uncertainty, data released by EY today reveals.

Overall value for UK M&A reached $78.3bn, up from $25.7bn in Q2. At the same time the volume of activity saw a slight drop to 705 deals from 719 in the previous quarter. In the first three quarters of the year, M&A value has seen activity worth $159.8bn and 2,252 deals.

According to EY analysis, Q3 saw 189 inbound transactions that generated $53.5bn and 139 outbound deals worth $18.4bn. This compares favourably to activity in Q2 of 2016, which saw inbound M&A activity raising $13.4bn (191 deals) and outbound deals worth $3.8bn (132 deals). The picture is slightly different on the domestic M&A market with 377 deals generating $6.4bn, when in Q2 396 deals raised $8.3bn.

Michel Driessen, EY’s Transaction Advisory Services Markets Leader for UK & Ireland, comments: “Despite a bumpy start to the summer, UK M&A activity seems to have taken Brexit related uncertainty in its stride so far. Businesses are getting accustomed to a period of sustained low growth, low interest rates and cheap debt. For M&A activity this means a move away from the string of large, so-called mega deals, of the past two years to a more balanced approach that sustains healthy levels of activity. 

“Dealmakers will continue to look for good deals that, through the acquisition of the right intellectual property assets, will help them penetrate new parts of the market. The cash and finance is available for the right deals and the difference between the winners and losers will be those that select the quality assets with real growth opportunity.”