Record investment poured into UK start-ups, says study

According to a recent study, large organisations invested more than £102 billion in UK SMEs (small and medium-sized enterprises) over the last four years.

The study reviewed a total of 5,447 deals which comprised of mergers and acquisitions (M&A), minority stake purchases and joint ventures. 3,011 of those deals were M&A transactions which suggests that the UK is economy is indeed ripe for growth.

The £102billion invested in UK SMEs over a similar period appears to dwarf the £62 billion invested by large organisations in UK R&D (research and development (work undertaken towards the innovation, introduction and improvement of products and processes)) suggesting that growth by acquisition has become a popular business strategy for companies looking to expand themselves into new markets and territories.

Perhaps as a result of the UK’s political turbulence over the last year, it is still important to mention that the total volume of collaborative deals (M&A, minority stake purchases and joint ventures etc.) dropped by 28 per cent from 2015/16 to 2016/17.

Despite this disappointing statistic and the ongoing political conundrum, according to Ernst & Young’s 16th Global Capital Confidence Barometer (‘report’), the UK is the third most attractive destination globally for deal making.

Steve Ivermee, the author of the report at Ernst & Young, said: “UK companies are adjusting their strategies to maximise growth opportunities and protect margins amid changing market dynamics at home and abroad.

“Successful companies will find ways to navigate these challenges. Executives are evaluating M&A across a wide range of geographies to secure market access and grow their customer base.”

If you are looking to grow your business or would like advice on a proposed collaboration, our corporate team at Mackrell Turner Garrett are able to advise you. If you would like to find out more about our services, please contact Mireille Turner at Mireille.turner@mackrell.com.

The following two tabs change content below.
Mireille Turner

Mireille Turner

Solicitor at Mackrell Turner Garrett
Mireille joined the firm as a solicitor in April 2015 and is a member of our Corporate Department.