Belfast Telegraph

Foreign buyouts plummet 42% in wake of Brexit

By Holly Williams

Corporate deal-making tumbled in the wake of the Brexit vote as mergers and acquisition (M&A) activity nearly halved between July and September.

The Office for National Statistics (ONS) said there were 140 successful £1m or more deals worth £34bn in the third quarter, against 278 worth £33.1bn in the previous three months. Despite a raft of high-profile swoops by foreign firms, M&A by overseas players for British companies fell 42% to 41 in the third quarter from 71 between April and June.

But mammoth deals - such as Japanese firm SoftBank's £24bn takeover of Apple chip maker ARM Holdings - saw the value of foreign M&A involving UK firms rise to £28.4bn from £22bn during the second quarter.

Northern Ireland has seen a spurt of corporate activity in recent weeks, with Dungannon-based Dunbia selling its Ballymena pork operation for £18m to Cranswick, and Springfarm Architectural Mouldings in Co Antrim buying a timber company in England.

Belfast law firms C & H Jefferson and McManus Kearney have also been taken over.

But overall, the data signals that firms are putting investment decisions on hold in the aftermath of the vote, with the Bank of England recently warning that corporate spending was being reined in amid uncertainty.

Domestic M&A has seen the biggest impact, with the number of deals involving UK firms buying or merging with other UK firms more than halving to 72 worth £3.2bn from 152 worth £7.2bn in the previous three months. This marked a rise on a year earlier, though, when there were 60 deals worth £1.2bn.

British firms buying overseas companies also fell - to 27 worth £2.4bn from 34 worth £1.7bn between April and June. But the sharp falls in the pound since the Brexit vote are thought to be helping spur on demand for foreign takeovers of British companies.

Belfast Telegraph