Deal activity involving North West-based manufacturing firms increased by 16.4% last year compared to 2012, as manufacturers attracted more PE investment, despite a national fall in the number of transactions completed within the sector, according to a new report.
Law firm, Irwin Mitchell said North West-based manufacturers were the target of more merger and acquisition (M&A) activity during 2013 than at any time since 2008.
The North West region’s share of manufacturing M&A activity across England reached 14.4% in 2013. This was up from 12.2% during the previous year and higher than all other regions except the South East where the figure stood at 31.5%.
The report also found there were more manufacturing deals which involved private equity. During 2013, 28.5% of M&A included some venture capital, whilst in 2012 it stood at 20.6%.
In the North West, the region experienced a rise in the number of PE-led deals, however its national share of venture capital investment in manufacturing fell last year. Despite the North West region seeing three more PE-led manufacturing deals compared to 2012, the total percentage fell to 17.2% from 19.8% in 2012.
This figure is still significantly higher than in Yorkshire (9.9%) and the West Midlands (8.8%) but lower than the figure for the South East which last year stood at 27.7%.
Andrea Copley, partner at Irwin Mitchells Sheffield Practice said:
“This report certainly reveals some encouraging signs as an uplift in deal activity in the North West points to greater confidence in the manufacturing sector generally.
“The manufacturing sector is clearly attractive to private equity at the moment and it was good to see that the proportion of M&A which has been funded with venture capital increased last year. Faced with this growing appetite and an improving economic picture, ambitious companies here in the region should seriously consider this option whilst they explore opportunities for developing and growing their business.”
This research is based on data sourced from Experian Corpfin’s proprietary M&A deals database
Stockport manufacturer expands premises 
Government backing for North West Sustainable Aviation Fuel production 
Japanese manufacturer to make £100 million investment in Greater Manchester operations