December 7, 2016

How has the Brexit Vote Impacted UK M&A?

by Lucille Jones

Post Brexit UK domestic M&A plunged to a 30 year low. Thomson Reuters Deals Intelligence explores the key facts and figures.

In September, Reuters reported Britain’s shock vote to leave the European Union chilled dealmaking activity involving British companies to the lowest level in at least two decades as bosses grapple with what Brexit will cost, according to Thomson Reuters data. Even before the vote, Brexit jitters had taken a toll on M&A activity. Confidence was and remains low.

Lucille Jones, Head of EMEA Deals Intelligence for Thomson Reuters says: “Lingering political uncertainty continues to affect UK deal making as the value of domestic mergers and acquisitions since the country’s vote to leave the European Union plunged 62 percent to a 30 year-low,” explaining that the death of larger deals is partly to blame. Not a single domestic M&A deal over the value of US$1 billion has been announced since the Brexit vote. The last time this occurred during the same period was in 2001.

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Key Facts & Figures

  • UK domestic M&A transactions announced since the Brexit vote total US$6.1 billion, down 62% from the same period in 2015. UK Domestic M&A activity is at its lowest level for this 20-week period since 1986.
  • Outbound deals, involving a UK buyer and a target outside of the UK, total US$88.5 billion since Brexit, up 59% from the same period last year, and more than any comparable period since 2007. British American Tobacco’s US$57.8 billion offer for U.S. cigarette maker Reynolds American Inc is the largest UK outbound deal post-Brexit. The deal accounts for 65% of outbound M&A, by value, during this period.
  • UK Inbound M&A totals US$55.2 billion during the post-Brexit period, down 69% from the same period last year in which Anheuser-Busch Inbev announced a US$110.3 billion bid for SABMiller Plc. The 2016 total has only been exceeded once (in 2015) since 2009.

  • Thomson Reuters Deals Intelligence provides you with up to the minute market intelligence through a variety of research reports including Daily Deals Insight, weekly Investment Banking Scorecards, monthly Deals Snapshots and our industry-leading quarterly reviews highlighting trends in M&A and Capital Markets.
  • Thomson Reuters Deals Content is the most extensive and flexible resource available for timely M&A and Capital Markets transactions. Our leading-edge products for the deal-making community enable you to analyze the current trends in the market and assess the changing competitive landscape by building your own custom league tables and reports.

Additional quarter-end coverage and analysis are also available at www.reuters.com/finance/deals

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