Dealmakers still like UK best despite Brexit, says EY survey

Bloomberg

If Brexit is bad for British business, global dealmakers aren’t paying attention. The UK is still their favourite place in Europe to invest, according to a survey by Ernst & Young LLP. Business executives from around the world ranked Britain third behind the United States and China as the top investment destination, ahead of Germany and France, the New York-based consultancy said in its Global Capital Confidence Barometer report.
“Doing deals is in the DNA of UK companies,” said Steve Krouskos, EY’s global vice chair of transaction advisory services. “The UK is home to the most important assets sought by dealmakers—technology, talent and intellectual property—so it always has been and always will be a major player.”
While the UK briefly fell to fifth place in the same survey a year ago in the initial panic that followed the referendum to split from the European Union, it snapped back in part because the pound’s Brexit-induced slide made targets cheaper.
The survey also suggests investors are taking tense Brexit negotiations and slowing economic growth in stride.
Apart from Brits, American and Australian buyers have been the most active on Britain’s M&A playing field, according to EY. Over the summer, Vantiv Inc. agreed to spend $10 billion buying e-commerce payments company Worldpay Group
Plc and McCormick & Co. took over Reckitt Benckiser Group Plc ’s food assets for
$4.2 billion.
M&A activity worldwide will only get busier in the coming year, according to the consultancy, which surveyed almost 3,000 executives across 43 countries.
“The resurgence of private equity could be the biggest M&A story over the next 12 months, and see corporates challenged much more aggressively for assets than during the past five years,” Krouskos said.
“Brexit creates some uncertainty, but fulfilling strategic growth needs rather than nationalism will drive deal sentiment.”