UK overseas investment chases pre-crisis levels » SMEInsider

UK overseas investment chases pre-crisis levels

A study of overseas investment made by UK businesses for 2014 shows that the number of transactions grew by 13 per cent compared to 2013, with the value of such deals reaching the highest level since 2007

The value of overseas investments more than doubled in 2014 compared to 2013; rising from £33.9 billion to £69.5 billion. According to the figures, the overall number of transactions of UK businesses investing overseas rose from 502 in 2013 to 566 in 2014.

Deals worth between £10 million and £100 million, which are classed as “mid-market”, grew by nearly 50 per cent with 86 deals taking place in 2013 compared to 123 in 2014.

However, there was a reduction in deals worth £500,000 to £10 million, reducing from 79 in 2013 to 66 during 2014.

In terms of regional growth, businesses based in Greater London accounted for the largest percentage of overseas investments as the region totalled 41.8 per cent of the UK’s business deals totalling £181 billion, an increase of 52.3 per cent compared to the previous year.

In addition, Northern Ireland saw the largest year-on-year growth across the UK with significant increases in UK overseas investment in Yorkshire and Humberside and the South West.

Manufacturing was the largest single industry in terms of numbers of deals, totalling 179 overseas agreements to a sum of £23 billion; the information and communication sectors saw 142 deals which totalled nearly £35 billion.

Business development manager at Experian UK & Ireland, Wendy Driver, said: “A more positive year for the economy as a whole was reflected by strong M&A activity in the UK, particularly with a significant increase in the number of high-value deals in the pharmaceuticals and telecom sectors.”

The improving economy and rising M&A activity is good news, but businesses considering a purchase or sale should still thoroughly research the companies they are dealing with,” she added.

Looking into the background of the management team at a target company, any corporate risk, and getting a snapshot of the international markets they operate in can help you to make an informed decision on a potential acquisition,” Driver said.