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Update on the market

 

Posted on 11 August 2017

Figures released at the end of June revealed that the rate of inflation dropped to 2.6% from 2.9%, mainly due to reduced petrol prices, and the Pound falling against the Dollar and the Euro by 0.25% and 1.12% respectively, exceeding economists’ expectations.  Interest rates have since been kept at their all-time low of 0.25%, signalling the Bank of England’s cutting of its growth forecasts.

On equity markets, London’s FTSE 100 has benefited from the Pound weakening as more than 60% of companies listed on the index are foreign earners and has mitigated losses caused by mining stocks and tobacco shares.  The performance of British firms reflects the continued climate of uncertainty caused by the minority government, Brexit negotiations and the general economic climate.

From an M&A perspective in the SME market, there is relief for buyers as a result of the decision to keep interest rates low. For those considering an exit, consideration of a timely sale is of heightened importance. Indeed, whilst the Pound remains weak, UK companies continue to be attractive to international buyers.

Here at Smith Cooper, we are delighted to say deal levels and pipeline forecasts have remained remarkably high in the first two quarters of 2017 and the Corporate Finance team remains busy over the traditionally quieter summer months.  This include a variety of sales, acquisitions and mergers across a wide range of sectors.

If you would like any further information about the M&A market or other Corporate Finance related topics, please feel free to contact one of our Corporate Finance experts.

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