Low Levels Of Interest In M & A

Foreign companies increased their interest in the UK from £4bn in Q3 2009 to £13.8bn in Q4. The number of transaction was more or less unchanged. Over 2009 as a whole however the value of acquisitions in UK by foreign companies was the lowest since 1993 at £30.8bn, a decrease of 41%. UK companies' interest in foreign companies decreased from £2.5bn in Q3 to £0.9bn in Q4, the lowest since records began in 1987. The total value of acquisitions by UK companies in foreign companies in 2009 as a whole was £9.9bn, the lowest since 2004. UK companies decreased their interest in UK companies from £1.9bn to 1.3bn between Q3 and Q4 2009. The total value for 2009 was £12.1bn, the lowest level since 1994.

The number of transactions in the UK by foreign companies in Q3 2009 for the £4bn was 27 and the £13.8bn in Q4 was from 26 transactions, the highest quarterly value since Q2 2008. Among the transactions taking place were the acquisition of Barclays Global Investors by Blackrock, Friends Provident by Resolution and the disposal and acquisition of Gatwick Airport. Foreign companies also disposed of 11 UK companies during the quarter. The total number of acquisitions in the UK by foreign companies in 2009 was 100 down from 252 in 2008, the lowest since 1988. A total of 78 of the 100 were direct transactions. Inward investment came mainly from Europe with 62% with 54% of the total came from EU countries, American companies accounted for 37% with the US accounting for 34% of the total and Africa, Asia and Oceania 1% each.

Transactions abroad by UK companies totalled £0.6bn in value in 2009 from £17bn in 2008. Another lowest figure since records began in 1987. Net transactions in the UK by foreign companies amounted to £24bn in 2009 from £47.4bn in 2008. Net cross-border acquisitions and disposals of UK companies totalled -£23.4bn in value.

The number of transactions abroad by UK companies was 26 in Q3 and 25 in Q4 2009 for a total value of £2.5bn and £0.9bn respectively. UK companies secured the disposal abroad of 6 companies worth £2bn in Q4 2009. Transactions taking place included the disposal of SPE S.A. by Centrica, of Aviva Australia Holdings by Aviva Plc and Balfour Beatty Plc's acquisition of Parsons Brinckerhoff Inc. The annual total of £9.9bn was from 99 transactions down from 298 in 2008, the lowest since 1987. Of the total of 99, 81 were direct transactions. The Americas were the primary destination for UK companies accounting for 50% of the total of overseas transactions, the EU accounted for 17%, Africa 16% and Asia 10%.

UK companies decreased their interest in UK companies in Q4 by 67% to £12.1bn but significant transactions included the acquisition of the Central African Mining and Exploration Company by the Eurasian Natural Resources Corporation and the acquisition of Avalon Acquisitions by Just Retirement (Holdings). There were a total of 59 transactions during Q4 2009 compared with 62 in Q3. They consisted of 39 acquisitions of independent companies and 20 by company groups that involved subsidiaries.

The total number of mergers and acquisitions in 2009 was 266 worth £12.1bn, 180 were mergers and acquisitions of indpendent companies and 86 were sales of subsidiaries between company groups.