Value of UK merger and acquisition deals jumps to highest level for two years

The value of UK merger and acquisition deals has risen to its highest level for more than two years, according to new figures.

This was partly driven by more deals by international investors and companies to snap up UK-based firms over the first quarter of the year.

The Office for National Statistics said a number of particularly large agreements helped increase the provisional value of all inward and outward M&A (merger and acquisition) deals to their highest level since late 2022.

However, the number of domestic and cross-border deals including changes of ownership dipped to 395 for the three months to March, from 497 in the previous quarter.

Statisticians highlighted that this included a reduction in activity in February, as some firms were cautious in the face of wider economic uncertainty.

In March, Bank of England officials said in a report for the quarter: “Mergers and acquisitions activity shows some signs of improvement, but growth is constrained by caution among buyers and sellers.

“Restructuring and insolvency activity remains slightly higher on a year ago.”

The latest data showed that deals by foreign firms to acquire UK companies were worth £19.2 billion over the quarter, jumping from £15.2 billion in the previous period.

This included the £3.3 billion deal by Danish brewing giant Carlsberg to buy J2O maker Britvic.

The jump in the value of deals was also supported by the £5.8 billion takeover of paper and packaging firm DS Smith by US rival International Paper.

Elsewhere, the value of outward M&A, where UK firms bought foreign companies, rose to £9.4 billion from £1.8 billion in the previous quarter.

Recent deals included London-listed mining giant Rio Tinto’s £5 billion buyout of Arcadium Lithium.

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