Public deals up, private deals down
There were 34 public takeovers (listed and AIM) in 2010, compared to only 21 in 2009.[1] That may reflect the effect of surging stock markets, with companies looking to use the value of their paper to make acquisitions.
But if so, it hasn’t trickled down to unlisted companies. Q3 statistics show only 38 acquisitions of independent UK private companies over £1m.[2] That must be an under-estimate, but the level of activity is still paltry, and a decline on Q2.
Good news for everyone except insolvency practitioners: corporate insolvencies were down to 15,894 in 2010, a fall of 3,618 on 2010, with Q4 figures down 19% on Q4 2009 and down 6% on Q3.[3] Ever since the beginning of the recession people have been predicting a huge surge in insolvencies in three months’ time, but there is no evidence of it happening, or that it ever will. Corporates are limping out of the recession, slowly rebuilding their balance sheets, and lenders are waiting patiently for their customers to recover, taking the modest profits and leaving the equity holders waiting more patiently still. HMRC may be trying to claw back their time-to-pay arrangements, but there is little evidence that they are aggressively pushing companies under; now that they are ordinary unsecured creditors, they don’t get much out of a liquidation.
[1] Source: PLC
A survey of European public companies by Boston Consulting and UBS found 16% had an intention to make significant acquisitions in the coming year: http://www.bcg.com/documents/file66898.pdf. Mind, they said much the same last year...
ReplyDelete