Britain Remains Europe's Most Popular Target for Foreign Predators

Strategic Insights -

Foreign companies spent a record Pounds 29.2 billion on British firms in the first half of the year, with American companies leading the way. British companies, on the other hand, spent a significantly lower Pounds 16.8 billion on overseas acquisitions. The surge in foreign takeover activity has made Britain the number one destination in Europe for international corporate acquirers, with the UK's open and efficient economy attracting multinationals.

Key Takeaways:

  • Foreign companies spent a record Pounds 29.2 billion on British firms in the first half of the year, a threefold increase from the corresponding period a year earlier.
  • American companies made 144 acquisitions during the period, spending Pounds 18.2 billion in the process, making them the largest spenders among the predators.
  • The most popular areas for acquisitions were food, motor manufacture, and utilities, with companies in the US, Netherlands, and Germany being the most popular targets.
  • Stephen Barratt, head of mergers and acquisitions at KPMG corporate finance, stated that Britain's position as the number one destination in Europe for international corporate acquirers seems secure, with the UK's open and efficient economy attracting multinationals.
  • The deals involving foreign takeovers of UK companies are small compared to global takeover activity, with Dollars 788 billion (Pounds 472 billion) worth of mergers and takeovers completed by the first week of May.
  • Top deals by UK firms abroad included Simon & Schuster being acquired by Pearson for Dollars 4.60 billion and Matthew Bender being acquired by Reed Elsevier for Dollars 1.65 billion.
  • Top deals by foreign firms in the UK included Energy Group being acquired by Texas Utilities for Dollars 10.40 billion and BTR's glass/plastic packing being acquired by Owens Illinois for Dollars 3.60 billion.
  • Companies such as Allied Colloids, T&N, Perkins Engines, and Spillers Petfoods were also acquired by foreign firms in the UK.

Statistics:

  • Pounds 29.2 billion: The total amount spent by foreign companies on British firms in the first half of the year.
  • Pounds 18.2 billion: The total amount spent by American companies on British firms in the first half of the year.
  • 144: The number of acquisitions made by American companies in the UK during the period.
  • Dollars 788 billion (Pounds 472 billion): The total value of global takeover activity completed by the first week of May.

Sources:

  • KPMG Corporate Finance - survey of corporate financiers at KPMG.
  • Stephen Barratt - head of mergers and acquisitions at KPMG corporate finance.
  • KPMG Corporate Finance - list of top deals by UK firms abroad and foreign firms in the UK.