Mergers and Acquisitions in January 2020

 
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The start of the year showed another increase in the volume of acquisitions. Business intelligence, Bureau van Dijk recorded 131 deals this January, of which 29 were overseas acquirors. This highlights an increase of 8% from last months’ figure.

The largest transaction witnessed this month was the acquisition of Cobham plc by AI Convoy Bidco Ltd in a deal value worth £4 billion. Advent International, one of the biggest and most experienced global private equity investors has shown its commitment to investing in the UK with the completion of its takeover of Cobham plc. Cobham plc is a leading global defence and aerospace company, with circa 10,000 employees globally and operations on North America, Europe, Australia and South Africa. Shonnel Malani, partner at Advent International, commented: “Advent is proud to build on our track record of UK investment as we take this historic company forward, on the next chapter of its development. We have strong conviction is Cobham’s businesses and look forward to delivering on each one’s full potential, for the benefit of customers, suppliers, and employees around the world.

Additional high value transactions for January include the acquisition of Equitable Life Assurance Society by Utmost Life and Pensions Ltd for £1.8 billion; Eaton Towers Holdings Ltd by AT Heston BV for £1.4 billion; and Galliford Try Partnerships Ltd by Bovis Homes Group plc for over £1 billion.

SSE Energy Services Group Ltd was acquired by UK’s leading energy OVO Energy Limited for £500 million, consisting of £400 million in cash and £100 million in loan notes. Combined, the two companies serve approximately 5 million households in the UK, and the acquisition will support OVO’s ambition to provide to clean, affordable energy for everyone.

Stephen Fitzpatrick, CEO and Founder of OVO commented the on acquisition and said: “This transaction marks a significant moment for the energy industry. Advances in technology, falling cost of renewable energy and battery storage, the explosion of data and the urgent need to decarbonise are completely transforming the global energy system. SSE and OVO are a great fit. They share our values on sustainability and serving customers. They’ve built an excellent team that I’m really looking forward to working with”.

Alistair Phillips-Davies, CEO of SSE, also commented: “We have long believed that a dedicated, focused and independent retailer will ultimately best serve customers, employees and other stakeholders – and this is an excellent opportunity to make that happen. OVO shares our relentless focus on customer service and has a bold vision for how technology can reshape the future of the industry. I’m confident that this is the best outcome for the SSE Energy Services business.”

The insurance sector was a particularly active sector in January. Endsleigh Insurance Services Ltd was acquired by A-Plan holdings; Warranty Management Services Ltd was acquired by Opteven Assurances SA; Capsicum Reinsurance Brokers LLP was acquired by Arthur J Gallagher & Company; and Bernard Saxon General Insurance Services Ltd was acquired by Lockyer Commercial Ltd.

Arrow Business Communications Ltd was acquired by MML Capital Partners LLP for £70 million to support the next phase of growth and transformation. Chris Russel, Chairman of Arrow Business Communications, said: “I am immensely proud of what we have achieved as a team over the last years, maintaining industry leading employee engagement scores and remarkable culture whilst experiencing continuous growth.” Luke Jones, Partner at MML also commented on the transaction: “We are delighted to be partnering with Arrow in its next phase of growth. Arrow’s marketing leading customer service and unique product portfolio provides a differentiated offering for its customers, which is support by its exceptional company culture.”

Some of the overseas transactions for January included the acquisition of Amerisur Resources plc by GeoPark  Colombia SAS for £242 million; M Three Corporate Consulting Ltd was acquired by US company, John Wiley & Sons Inc. for £97 million; Lotte Chemical UK Ltd was acquired by Alpek SAB de CV in Mexico for £69 million; ID & C World Holdco Ltd was acquired by CCL Industries Inc. in Canada for £31 million; and AWS Electronics Group Ltd was acquired by Incap Oyj in Finland for £15 million.

In summary, January’s M&A activity has taken place in various sectors, with significant deals contributing to this month’s overall figure. With active public trader buyers as well as private equity investors, the UK continues to appeal to acquirers from both the UK and overseas. 

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