Private equity buyout deals soar more than 50 per cent in pre-Brexit rush

Private equity buyout deals were up more than 50 per cent in the fourth quarter of last year driven by the pressure to complete agreements ahead of Brexit.

Analysis of UK mid-market activity showed that the figure was 56 per cent higher that the fourth quarter of 2017, and activity levels hit a 10-year high.

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Meanwhile, a total of 140 deals were completed in 2018 compared to 77 in 2017 representing an increase of 82 per cent, according to research by DC Advisory.

“The main driver was short-term confidence accompanied by plentiful capital and medium-term uncertainty as a result of Brexit risk,” DC Advisory chief executive Richard Madden said.

“So if you were thinking of selling a business in the next 12 to 18 months then you probably sold then.

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“There is a natural accelerator to get deals over the line in December and get them done by Christmas.

In the fourth quarter of 2018 this was exacerbated further by Brexit – January and February is only days away from the 29 March exit date so many parties involved in transactions decided they’d rather not take that risk.”