Distressed deals continue to fall

By July 26, 2011Finance, News

Acquisitions of insolvent businesses in the North West have continued to fall in the first half of 2011, according to research by Experian Corpfin on behalf of the insolvency trade body R3.

 

The figures show that distressed deals now account for one in 10 of all mergers and acquisitions in the region compared to one in five when activity peaked in late 2009.

 

During the first half of 2011, 23 out of a total of 226 acquisitions (1 in 10) in the North West involved companies acquired out of administration or other formal insolvency procedures. This compares to 32 out of 230 acquisitions (1 in 7) during the second half of 2010 and 22 out of 117 (1 in 5) in the final quarter of 2009.

 

Jeremy Oddie, North West regional chair of R3 and head of recoveries at Mitchell Charlesworth, said: “Distressed acquisitions have become a key part of the regional deals landscape over the past three years. Investors have been taking the opportunity to acquire businesses and assets while values are low and we have seen the emergence of specialist turnaround investors.

 

“While the number of insolvent deals has been falling, investors should remain alert as we can expect to see a continued supply of decent investment opportunities in the run-up to recovery.”

 

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