Europe led the way for deal volumes within the logistics sector in 2017, according to accountancy and business advisory firm BDO’s Logistics and Supply Chain Management M&A Review.
Deal volumes in Europe (including the UK and Ireland) represented 54% of global M&A activity for the year, with 140 completed sales, a level consistent with the previous year.
After a bumper year in 2016 when the total value of deals peaked at £27.2bn globally, activity in terms of value and volume fell in 2017 to £16.9bn disclosed deal values. Average deal multiples fell marginally in 2017, to 13.6x from 13.8x in 2016, but show an upward quarterly trend in 2018.
In particular, supply chain technology is generating significant interest from private equity investors, demonstrated by a growth in the proportion of transactions involving direct investment by financial institutions from 13% in 2015 to 17% in Q1 2018.
Jason Whitworth, M&A partner at BDO, explained: “2016 benefitted from a number of high-value deals, with three transactions above £3bn.
“Lower activity in 2017 may be driven by elements of uncertainty across a number of significant global markets, but large organisations continue to search for profit enhancement through consolidation and smaller niche providers are looking to take advantage of the ever-changing landscape.
“Market disrupters and new market entrants are in a race for technology and automation, driving new business models to deliver against ever increasing customer expectations. This change is propelling investment and transactional activity, as businesses seek to develop innovative and scalable platforms, delivering efficiencies through scale and consolidation.”
Meanwhile, the UK remained a hugely active part of the global logistics market, representing 11% of sales and 10% of acquisitions by volume in 2017. Investment from overseas also remained healthy, with 21% of buyers from overseas in 2017 and the average deal value increasing to £82m.
Whitworth continued: “Despite the uncertainty of Brexit, the UK has seen increased investment appetite and activity from financial institutions as they recognise an opportunity to deliver growth and value. High-growth, entrepreneurially-spirited, mid-sized businesses must continue to champion new technologies and innovation to drive sustainability across the industry.”
Europe brought the way in which for deal volumes inside the logistics sector in 2017, based on accountancy and business advisory firm BDO’s Logistics and Suppl…
Europe brought the way in which for deal volumes inside the logistics sector in 2017, based on accountancy and business advisory firm BDO’s Logistics and offer Chain Management M&A Review.
Deal volumes in Europe (such as the United kingdom and Ireland) symbolized 54% of worldwide M&A activity for that year, with 140 completed sales, an amount in conjuction with the previous year.
Following a bumper year in 2016 once the total worth of deals peaked at ￡27.2bn globally, activity when it comes to value and volume fell in 2017 to ￡16.9bn disclosed deal values. Average deal multiples fell marginally in 2017, to 13.6x from 13.8x in 2016, but show an upward quarterly trend in 2018.
Particularly, logistics technologies are generating significant interest from private equity finance investors, shown with a development in the proportion of transactions involving direct investment by banking institutions from 13% in 2015 to 17% in Q1 2018.
Jason Whitworth, M&A partner at BDO, described: “2016 benefitted from numerous high-value deals, with three transactions above ￡3bn.
“Lower activity in 2017 might be driven by aspects of uncertainty across numerous significant global markets, but large organisations continue to look for profit enhancement through consolidation and smaller sized niche providers are searching to benefit from the ever-altering landscape.
“Market disrupters and new market entrants have been in a race for technology and automation, driving start up business models to provide against ever growing customer expectations. This transformation is propelling investment and transactional activity, as companies aim to develop innovative and scalable platforms, delivering efficiencies through scale and consolidation.”
Meanwhile, the United kingdom continued to be a hugely active area of the global logistics market, representing 11% of sales and 10% of acquisitions by volume in 2017. Investment from overseas also continued to be healthy, with 21% of buyers from overseas in 2017 and also the average deal value growing to ￡82m.
Whitworth ongoing: “Despite the uncertainty of Brexit, the United kingdom has witnessed elevated investment appetite and activity from banking institutions because they recognise an chance to provide growth and cost. High-growth, entrepreneurially-spirited, mid-sized companies must still champion technology and innovation they are driving sustainability over the industry.”
