Never mind green shoots on the High Street, if you want to take the pulse of British business today you need to look at pet food and fish tanks. Two less glamorous corners of industry would be hard to find, but a tiny management buy-out deal involving a public company called Cranswick captures the new mood of normality slowing returning to the business world.
It's only worth £17m, but the management team is buying the company' s pet and fish division with a loan from Lloyds TSB Development Capital - the private equity arm of that troubled banking group Lloyds. The private equity boys may just have been asleep for the last two years and not noticed this stuff had gone out of fashion. Their website still boasts: "having a parent company – the Lloyds Banking Group – that is a major international player obviously pays dividends in strong support and financial stability." But I suspect they are actually ahead of the curve: this sort of dull, safe deal is likely to be the future of private equity for some time to come.
The cautious return of bank debt is not the only factor driving deals again. A few weeks of steady recovery in the stockmarket is also giving sellers some comfort about what their businesses are really worth.
Just this morning we've seen a $7.4bn deal for Oracle to buy Sun Microsystems; a $3.6bn takeover from Glaxo, a $6bn bottling deal from Pepsi and UBS managing to sell its Brazilian business for $2.5bn. It's not quite a return to boom times, but there's definitely something for those bankers to do again.
