UK Public M&A Trend Report update—1 January–31 March 2019

Background and approach

Lexis®PSL Corporate and Market Tracker has conducted research to examine the current trends in respect of UK public M&A. Data for this report has been sourced from the Market Tracker transaction data analysis tool which allows users to access, analyse and compare the specific features of numerous corporate transactions. This is an update to our Market Tracker Trend Report––Trends in UK Public M&Adeals in 2018 in which we examined firm and possible offers announced in 2018.

For the purposes of this update we analysed the period between 1 January 2019 to 31 March 2019 (Q1 2019). While comparisons have been made to the corresponding period in 2018 (1 January 2018–31 March 2018) (Q1 2018), definitive conclusions can only be made on the completion of the full year trend report of 2019.

We reviewed a total of 31 transactions that were subject to the Takeover Code (Code): 16 firm offers (11 for Main Market companies, five for AIM companies) and 15 possible offers, made up of 12 possible offers (nine for Main Market companies and three for AIM companies) and three formal sale processes (FSP) (for three AIM companies).

The percentages included in this update have been rounded up or down to whole numbers, as appropriate.

Deal highlights

Key highlights during the review period include:

1. •increase in deal volume compared with Q1 2018, but a 27% decrease in aggregate deal value
2. •69% of firm offers structured as schemes
3. •75% of firm offers involved cash consideration
4. •four hostile bids and three sets of competing bids
5. •technology sector the most active (19% of firm offers)
6. •38% of firm offers made by private equity bidders and 44% of bidders by non-UK bidders
7. •US bidders involved on 25% of firm offers with aggregate deal value of £9.5bn

Deal value and deal volume

Deal volume was higher in Q1 2019 compared with Q1 2018 (16 firm offers compared with 13 firm offers in Q1 2018).

However, aggregate deal value was lower (£14bn in Q1 2019 compared with £19.3bn in Q1 2018), which represented a 27% decrease in aggregate deal value.