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Does merger flurry spark hope for UK economy?

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There has been a recent flurry of merger and acquisition news perhaps pointing towards hope in the market.

BAE and EADS have confirmed merger talks, while Xstrata has been given an extra week to decide on a revised $36billion bid from Glencore. A few months ago, GlaxoSmithKline Plc also announced an acquisition of its long-time partner Human Genome Sciences Inc for about $3 billion.

So does this deal flurry spark hope for our economy? This is against a backdrop of figures from the Office of National Statistics, which say the total deal value of acquisitions by foreign companies in the UK dropped in the first half of the year to its lowest level since 2005.

From our perspective, lots of deals are taking place in the SME market. For example, last week our team advised FE Barber Ltd (who currently trade as two businesses; Kingsland Wines and Spirits and Legacy Wines) on the acquisition of Stratford’s Wine Agencies. This is a very good news story when many small to medium-sized companies are finding it difficult to access finance.

By commercial solicitor and associate, Nicola Whittle

 

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