Avison Young’s UK company tracker
H1 2024 bulletin
Our H1 2024 UK Company Tracker reveals a market landscape where corporate expansions and acquisitions continue to outpace contractions, although these activities have slowed compared to the same period last year, as businesses continue to navigate ongoing economic challenges. Although contractions have slightly increased, the data uncovers that opportunities remain present in the marketplace.
Key Findings:
- 530 Acquisitions: In H1 2024, 530 companies acquired other businesses, marking a 20% decline compared to H1 2023.
- 639 Expansions: 639 companies expanded their operations, with expansion volumes down 23% year-on-year.
- Stabilising Contractions: Contractions saw a slight increase of 2% year-on-year, indicating a potential stabilisation.
Despite continued economic uncertainty, the number of corporate expansions and acquisitions in H1 2024 still exceeded those of contractions, reflecting cautious optimism among businesses. We anticipate, however, that this confidence will grow further, bolstered by the new government and a potential fall in interest rates later in the year. While overall acquisition activity declined by 20% year-on-year and expansions fell by 23%, the rate of contraction has begun to stabilise, increasing by only 2% compared to the same period in 2023.
Sector Insights: The tech, construction, and financial services sectors led the way in acquisition activity, contributing to 47% of all transactions in H1 2024 with 253 separate company deals. Despite a 24% decrease in activity compared to H1 2023, these sectors continue to play a crucial role in the UK economy. Significant deals in this period included Dains Group’s acquisition of McInerney Saunders Chartered Accountants and Tesco Bank’s acquisition by Barclays.
Conversely, the leisure and retail sectors experienced more subdued acquisition activity, with just 52 transactions—a decline of 18% year-on-year—likely driven by higher operating costs and lower consumer spending. However, despite an overall 37% year-on-year decrease in retailer expansion activity, there have been retailers who have been particularly active, notably Aldi, Lidl, Greggs and Boots, who all plan to open new stores across the country.
Outlook: The findings from H1 2024 indicate that while sectoral challenges persist, expansions and acquisitions still outnumber contractions. Furthermore, most contractions have not led to insolvencies, suggesting that companies are finding ways to navigate these tough conditions. Looking ahead, we anticipate the economic recovery will gain momentum in Q4 2024, driven by potential interest rate cuts and solidifying the new Labour government’s policies. This could mark a significant turning point for the market, spurring renewed corporate and investment activity.
Sector Insights: The tech, construction, and financial services sectors led the way in acquisition activity, contributing to 47% of all transactions in H1 2024 with 253 separate company deals. Despite a 24% decrease in activity compared to H1 2023, these sectors continue to play a crucial role in the UK economy. Significant deals in this period included Dains Group’s acquisition of McInerney Saunders Chartered Accountants and Tesco Bank’s acquisition by Barclays.
Conversely, the leisure and retail sectors experienced more subdued acquisition activity, with just 52 transactions—a decline of 18% year-on-year—likely driven by higher operating costs and lower consumer spending. However, despite an overall 37% year-on-year decrease in retailer expansion activity, there have been retailers who have been particularly active, notably Aldi, Lidl, Greggs and Boots, who all plan to open new stores across the country.
Outlook: The findings from H1 2024 indicate that while sectoral challenges persist, expansions and acquisitions still outnumber contractions. Furthermore, most contractions have not led to insolvencies, suggesting that companies are finding ways to navigate these tough conditions. Looking ahead, we anticipate the economic recovery will gain momentum in Q4 2024, driven by potential interest rate cuts and solidifying the new Labour government’s policies. This could mark a significant turning point for the market, spurring renewed corporate and investment activity.
Figure 1: Corporate expansions and acquisitions continue to outpace contractions, although these activities have slowed compared to the same period last year.
Source: Avison Young, UK Activity Report
Figure 2: The rate of corporate contraction has begun to stabilise, increasing by only 2% compared to the same period in 2023.
Source: Avison Young, UK Activity Report
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