Mergers and acquisitions still below pre-crisis levels with deals between UK firms at their lowest since records began in 1969

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From July to September there were just 72 deals worth £1m or more involving UK companies

Mergers and acquisitions in Britain have still not bounced back to their pre-financial crisis levels – but the value of the deals is up nearly a quarter from last year, figures show.

From July to September there were just 72 deals worth £1million or more involving UK companies, compared to 479 for the same period in 2007, and 230 in the third quarter of 2008.

The number was down on the second quarter of this year, which saw 112 mergers and acquisitions take place, according to the Office for National Statistics.

And deals between British companies were at their lowest ever since records began in 1969 – totalling just 31.

But despite the number remaining low, the value of the agreements struck has shot up, with mergers and acquisitions from July to September worth on average 23 per cent more than those undertaken in the same period in 2014.

The average value for deals done in the third quarter of 2015 was £154.8million, up from £125.4million for the same period last year. 

Foreign companies taking over British firms secured the most lucrative deals, with the average transaction being worth £383million.

Matt Gooch, head of European Banking at investment banker William Blair, said: ‘The foundations for a strong 2016 for mergers and acquisitions have been laid this year.

‘Following recent fundraising activity, a large amount of private equity cash is currently sitting on the side lines, as we are seeing a greater demand from investors and companies for higher quality investment opportunities.

‘Macro headwinds – including volatile foreign exchange rates and low oil prices – have affected sectors such as industrials, and we expect this to be a feature in 2016 also.’

He added: ‘However, the technology and healthcare sectors should continue to grow, while rising disposable incomes and an improving economy make us optimistic about the outlook for the consumer and retail sectors.

‘We expect further investor appetite for these areas in 2016.’