Acquisitions are on the up, says Grant Thornton
More than a third of privately held businesses (PHBs) in the United Kingdom are planning to grow via acquisitions, according to Grant Thornton's latest international business report.
Thirty-six per cent of respondents are planning acquisitions in the year ahead compared with 26 per cent in 2010.
According to accountant Grant Thornton, valuations of high quality fast growing businesses are being boosted by intensifying competition among bidders.
Ian Wilson, head of Grant Thornton’s corporate finance team in the Midlands, said: "Over the last 12 months there has been a significant improvement in the interest, appetite and financial capability of trade buyers to do deals. We have seen evidence of high quality businesses attracting premium prices. In particular, fast-growing online retail businesses have attracted impressive takeover offers in recent months.”
Grant Thornton’s research suggested that among British PHBs planning acquisitions, 85 per cent expect to make domestic acquisitions and 29 per cent were planning to acquire overseas businesses.
The main M&A drivers for British firms were to build scale (61 per cent), acquire new technology or established brands (41 per cent), gain access to new geographic markets (61 per cent) and gain access to lower cost operations (40 per cent).
