The average value of a corporate finance deal in Scotland is on the rise, despite economic uncertainty which is expected to continue for the foreseeable future, according to PwC.
The firm's head of corporate finance in Scotland Jon Shelley told business leaders that although the overall number of deals being completed has fallen in the last year, the average value of these deals has increased.
Shelley said: “What we are seeing is that average pricing on completed deals is slowly increasing and that at the moment it’s typically the larger perhaps more diversified, international and more differentiated businesses that are sought after and selling at increasingly strong prices.”
The overall number of deals completed in the year to 2018 was down about 25% year on year. However, PwC said a high bar had been set in 2017, meaning the market is indexing around 10% down over a 10 year average. It added that competition and the requirement to invest is helping to drive prices up.
Indications suggest political, economic, and regulatory uncertainty will continue over the next year, though this is not expected to further dent the market given the availability of capital and pressure to make a return in spite of the scale and pace of change, according to PwC.
He said there is an increasing amount of capital in the hands of private equity houses and debt funds, which is making the market hugely competitive and a genuine struggle to invest billions of pounds.
