Short-term consumer boost eases probable Brexit fallout in UK

The UK and Ireland buyout market witnessed great volatility throughout 2016, with particular impact seen in the quarters leading up to and immediately following the referendum.

While euro-denominated aggregate value fell by 49% in Q1 2016 compared to the same period in 2015, the impact on deal volume was a less pronounced decrease of 18%. The second and third quarters, which sandwiched the Brexit vote, saw respective annual increases of 10% and 15% in dealflow. However, aggregate value in each quarter respectively tumbled by 55% and 61%, reflecting both a more cautious approach in the large-cap space and sterling's devaluation. Nevertheless, aggregate value recovered strongly in the final quarter, with the €9.1bn changing hands representing a 16% year-on-year rise against a marginal 2% drop in volume.

"The Brexit vote, in retrospect, was well-placed around summer, where people were naturally going to take a pause," says Callum Bell, head of corporate and acquisition finance at specialist bank Investec. "But thereafter it picked up a head of steam into quarter four where we saw a catch-up on deals that had been postponed. Also, there was an element of people coming to the realisation that actually it was still a good time to do deals."

Click here to download the UK & Ireland chapter of the 2017 Annual Buyout Review, including full five-year statistics, in-depth data breakdowns and exclusive commentary from leading local practitioners

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• Annual Buyout Review