UK M&A value rises two-thirds in H1, PwC finds

The value of UK M&A activity for the first half of 2024 rose by two-thirds compared to the same period last year despite volume being down by a fifth over the same period, according to figures from PwC’s latest Global M&A Industry Trends report. 

In total the UK saw 1,703 deals in H1, compared to 2,126 over the same period last year, a 20% decrease and almost mirroring the decrease in volume seen at a global level of 25%.

Despite this, UK M&A activity is at roughly the same level as H2 23 which saw 1,681 deals and is still tracking around the same level seen pre-Covid in 2019.

PwC’s analysis shows there was a total of £68bn worth of UK deals in H1 compared with £41bn the previous year, a 66% increase in value and better than global which saw a 5% increase in value. There were 16 deals greater than £1bn in value in H1 with a combined value of £42bn, compared to seven deals with a combined value of £17bn in H1 23. 

Lucy Stapleton, global head of deals at PwC UK, said: “The UK M&A activity in the first half of the year has mirrored the performance of the second half of last year, reflecting a cautious confidence in the current deals market. There remains significant pent up demand to do deals however, a stand-off persists: sellers are holding out for prices they consider optimal, while buyers are waiting for greater certainty before committing to transactions.

“Looking ahead to the second half of the year we expect confidence to continue growing in the market with elections now concluded, economic conditions continuing to improve and the prospect of a reduction in the Bank of England base rate creating favourable conditions for dealmakers. Businesses will need to be agile to opportunities and shift their view of M&A from transactional to transformational to unlock growth and value potential in their organisations.”

UK M&A activity by industry for H1 shows that industrials and services saw the most deal activity with 456 deals, making up just over a quarter of the total for the first half of the year, followed by consumer markets (383 deals) and technology, media and telecoms (376 deals).

The consumer markets industry saw deals with the highest value for H1, making up almost a third of total deal value with £20bn worth of transactions. Financial services followed closely with £19bn, then TMT with £11bn.

Of the 1,703 deals in H1, 37% involved private equity, a slight decrease from the same period last year of 41%. The analysis also showed that of the £68bn in deal values generated in H1 24, private equity accounted for 46% also slightly down from 52% in the first half of 2023.

Stapleton said: “The need to respond to disruption, remain competitive and grow market presence continues to be a key driver and has driven volumes in the consumer and industrials and services sector. Transactions are also being driven by megatrends and so far this year we have seen consistent deal flows in areas such as new technology software, energy transition particularly where there is large-scale infrastructure investment and healthcare.”