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Investment into North West Companies Soars

Total investment into North West-based companies has nearly trebled in the first half of 2017 thanks largely to the impact of a £620m deal, according to Deloitte.

Its latest Cross Border Deals Radar, conducted in partnership with Experian Corpfin, reveals that the value of inbound deals has climbed to £1.1bn during the first six months of 2017 from £305m in the same period of 2016. Deal volumes were also high with the total of 25 transactions up on the 21 reported in the first half of last year, meaning the average deal value has rocketed threefold to £46m.

The value of inbound activity was boosted largely by the acquisition of Salford-based Exova Group by the Dutch provider of material and product testing analysis Element Materials Technology in a deal worth £620m. The transaction involved Exova delisting from the London Stock Exchange and reregistering as a private limited company.

Buyers have come from across the globe in the first half of the year, with strong appetite from European businesses (nine transactions) and Asian countries (five investments). However, the most active country remained the USA (ten deals), which accounted for 41 per cent of all inbound deals.

In contrast to the strong levels of inbound transactions, there has been a slowdown for investment from North West companies overseas. In total, 11 outbound deals were completed in the first half of this year compared with 20 deals the previous year.

John Breheny, director at Deloitte in the North West, said: "These findings highlight that North West businesses are still considered among the most attractive in the world, with a range of acquirers from across Europe, Asia and North America targeting our region. In particular, the US/UK deal corridor has proven to be extremely active in recent years, and it is unsurprising that technology, media and telecoms businesses are those most frequently targeted – a sector in which the North West excels.

"In the first half of 2017, inbound overseas investment into North West companies has significantly exceeded outbound investment, a trend at least in part driven by the current weakness in sterling. Any appreciation in the value of sterling would, we expect, be accompanied by a corresponding increase in outbound deal activity towards previous levels."


Source: Insider Media