UK MBOs strong

The first quarter of 2004 saw continued strong activity in the UK mid-market, according to figures released by KPMG’s Private Equity Group which tracks UK buyouts with a value over £10m. KPMG recorded 28 transactions with a total value of £3.6bn in the first quarter. Average deal size was £129m.

Four deals over £250m were completed in the quarter although none surpassed the £1bn level seen in previous quarters. The larger deals were Baxi Group (£663m), Weetabix (£642m), National Wind Power (£400m) and IMO Car Wash (£351m).

In the UK mid-market (deals less than £250m) there were 24 deals with a value of £1.54bn. This is the highest value quarter in this market segment for over two years. Charles Milner, head of corporate finance at KPMG’s Private Equity Group, said: “Activity in the first quarter shows two distinct trends: the UK middle market continued to perform strongly but the larger LBO market was very quiet. Overall the outlook remains positive, but the activity in the marketplace has yet to result in raised levels of completions. Although confidence has improved, the length of time being taken to complete deals has yet to come down to levels previously seen in more healthy markets.”