by Shane Henson — March 27, 2013—The value of merger and acquisition (M&A) deals in the U.K.’s facilities management sector rebounded in 2012, and the volume of transactions also remained strong, according to analysis from business and financial advisers Grant Thornton UK LLP.
Publicly recorded transactions in the sector totaled 95 deals, just shy of the 2011 total yet comfortably ahead of volumes seen in 2009 and 2010, notes Grant Thornton. Interestingly, the value of these transactions surpassed the previous year’s total four-fold, with the disclosed deal values for the top 10 facilities management transactions totaling more than £3.4 billion in 2012.
The total value and volume of M&A in the sector was boosted by a flurry of higher value deals in the latter half of the year, with blockbusters such as private equity heavyweight Terra Firma’s £3 billion acquisition of Annington Homes seeing the largest value transaction in recent years.
Grant Thornton says 2012 also saw a sharp rise in the number of soft facilities management deals being recorded, forming almost half of all recorded deals. This compares with around one third of the annual total in 2011.
Despite the headline-grabbing Terra Firma deal, the year saw a drop in M&A activity by private equity investors, with only around half the number of private equity deals compared to 2011 and only a third of those made in 2007. Faced with continued lending constraints, and a market in which trade buyers are enjoying healthy balance sheets, private equity activity is expected to remain limited in 2013, the company says.
