Buyout market bounces back - CMBOR
The UK buyout market "rebounded strongly" in 2010 with the overall value of private equity backed transactions reaching £18.6bn, the Nottingham-based Centre for Management Buy-out Research (CMBOR) has reported. This compares to £4.7bn in 2009, when buyout values fell following the collapse of Lehman Brothers.
But in the first quarter of 2011, the UK buyout market fell in value by 43 per cent to £3.2bn. The market value was £5.6bn in the final quarter of 2010, CMBOR said.
The research said UK deal flow has "continued to dominate" the European buyout market in value (£3.3bn) with 44 deals accounting for 34 per cent of all European deal flow in the quarter.
Secondary buyouts were described as "a major source of deal flow" in 2010 in the UK with a total of 48 worth £8.5bn.
In the first quarter of 2011, the research revealed that the total number of secondary buyouts fell from 15 in the fourth quarter of 2010 to 13 in the first quarter of 2011. By value, secondary buyouts declined quarter-to-quarter from £2.8bn to £1.6bn. Secondary buyouts comprised 49 per cent of all UK buyouts compared to 46 per cent in 2010 and 20 per cent in 2009.
A total of 45 per cent of deals were in the lower mid-market involving deals below £10m for the first quarter of 2011, CMBOR said.
There were only two deals in this quarter reported in the £500m to £1bn range - the sale of the Priory Group for £925m and the public to private buyout of Brit Insurance for £888m.
London "dominated" the UK buyout industry by value (£1.2bn) accounting for 36 per cent of the UK’s total value in the first quarter of 2011.
There were no deals completed in the East Midlands, North East or Northern Ireland in the first quarter of 2011, CMBOR said.
