Still a Special Relationship


 

Mar 2017 | Simon Ward

Having spent last week in the USA with our partner firm Stout, I thought this might be an appropriate time to reflect on US/UK corporate finance relations.  Whilst not mentioning the great dealmaker in the White House will be a struggle, it is useful not to dwell on his first month in office and instead reflect on what truly binds the USA and UK:

  • Culture
  • Language
  • History

One should not underestimate any of these factors.  It is also impossible to argue with the data that shows where a UK company is acquired by an overseas buyer, seven out of ten buyers are US based.  The devaluation of sterling over the last nine months has only served to strengthen this trend with UK assets now some 20% ‘cheaper’.  Whilst one should remember that at some stage that US acquirers will need to repatriate profits, the underlying trend of UK assets being more attractive than ever is unarguable.  This was certainly the view we heard from our colleagues at Stout, who were tremendously positive about the mandates they have from clients looking to grow by acquisition in the UK.

So there we have it, a blog about the US that hasn’t mentioned ‘the Donald’, while it is certainly our first blog for some months that doesn’t contain the ‘B’ word.  For business owners the message is clear – the US has always been the most likely source of an overseas acquirer and this remains more the case than ever.  The fundamental drivers remain unchanged there are now also more tail winds than ever – just ask the Americans.


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