UK exits down 30% in H1 2016

Despite much talk of uncertainty-driven cold feet in the run up to the June referendum, buyout activity in the UK held up reasonably well in the first half of 2016, with a 10% drop in volume terms compared with the H2 2015 tally. The same cannot be said on the sell-side though: unquote" recorded 85 exits from previous buyout investments in the first half, down by nearly a third on the 120 divestments announced during H2 2015.

The drop is also nearly identical when compared to the same period last year, with GPs exiting 119 UK buyout investments in the first half of 2015. Very similar levels of exit activity had been recorded in the two halves of 2014 as well (118 and 114 respectively).

Delving down into the H1 2016 figures, flotations and trade sales are where the drop in dealflow was most noticeable. The former fell from 12 IPOs recorded in the second half of 2015 to just five in H1 2016. These notably included the £800m listing of Apax-owned Ascential, part of the Guardian Media Group (GMG), on the London Stock Exchange in February. It must be noted that the volume of IPOs recorded in the first half of 2016 was actually an improvement on the three listings taking place over the same period last year.

Trade sales also fell by 30% in volume terms between H2 2015 and H1 2016, with 35 transactions recorded in the latter period. Again, comparing this figure to H1 2015 lends some perspective to this, with a broadly similar number of trade sales recorded in the same period last year (39). It will be interesting to see how this trend evolves in the second half of 2016, as unquote" recorded a surge of interest from foreign corporates for UK private-equity-owned assets in the immediate aftermath of the 23 June vote, partly driven by a sharp drop in the value of the pound.

Secondary buyout activity held steady in the first half with 23 transactions recorded, against 24 in the previous six months, suggesting that GPs remained mostly confident in the run-up to the referendum. That said, SBOs were significantly more plentiful in the first half of last year, with 45 deals recorded between January and June 2015.

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• Topics
• UK / Ireland
• Exits
• Brexit
• United Kingdom
• Unquote Data