A  UK focused M&A report has found that a record number of UK companies (60 per cent) plan domestic and overseas acquisitions over the next 12 months, defying the economic uncertainty caused by Brexit. Some of the other main findings are: the UK remains third on the global M&A destination list; UK executives are reorganising their geographic operations in response to Brexit risks and stronger cross-border dealmaking is expected to be the top UK M&A trend for the next 12 months alongside a return of private equity as a major acquirer of assets and an increase in activist investor intervention in M&A.

US top target

The EY Global Capital Confidence Barometer reports that the US remains the top-outbound destination for UK acquirers. Stronger cross-border dealmaking is expected to be the top UK M&A trend for the next 12 months (29 per cent) alongside a return of private equity as a major acquirer of assets (27 per cent), and an increase in activist investor intervention in M&A (20 per cent). 

Increasing risks

UK respondents acknowledge increasing risk on the horizon with a higher level of concern for geopolitical risks and economic uncertainty (47 per cent) compared to the global average (43 per cent). The response of UK businesses to the issues raised by Brexit is reflected in the 63 per cent of UK respondents who are reorganising their geographic operations in reaction to ‘potential changes in trade policies or an increase in protectionism’ – much higher than the global figure of 41 per cent.

Corporate venture capital investments 

Corporate venture capital investments (CVCs) are currently being used 68 per cent of UK respondents, ahead of the global average of 49 per cent. The primary reasons for using CVCs were access to new capabilities and technologies and a faster route to market.