Acquisitions to ‘drive’ middle-market growth in 2021, according to RSM

The majority of middle market businesses investing in 2021 are planning or considering acquisitions as a “major part of their strategic growth plans”, according to a study by RSM. 

‘The Real Economy’ survey which was conducted in partnership with market research and analytics company The Harris Poll, questioned over 400 middle market business leaders to uncover the “challenges and opportunities” following the end of the Brexit transition period. 

Of the 59% of businesses that will be making or considering investments in 2021, 82% confirmed this would be in the form of company acquisitions. 

In addition, 32% of the business leaders surveyed anticipate raising private equity (PE) funding in the next 12 months. 

Charlie Jolly, head of private equity at RSM UK, said: “Resilient middle market businesses have become increasingly acquisitive and have remained confident in spite of lockdowns and any Brexit turbulence. 

“Private equity investors are underpinning this middle market as they are not only using record levels of capital raised before the pandemic to invest in business growth; but are also supporting businesses that have hit stormy waters during the last 12 months.”

He added: “However, the market remains competitive and PE investors will compete fiercely to back the best business with a strong management team and a clear business plan. So, middle market businesses looking to realise ambitious growth plans need to be deal-ready to attract the best offer from the best investor.”