Bargain UK stockmarkets set for a boom in mergers and acquisitions

Bargain-hunters sense opportunity in UK stockmarkets: there have been 14 takeover deals in the past month alone.

The FTSE 100 has enjoyed its best month in 31 years. Britain’s blue-chip index gained 12.4% in November, adding more than £180bn to its market value. You would have to go back to January 1989 to find a more profitable month for UK investors. 

Despite the gains, the FTSE 100 remains down 16% so far this year. The UK market “has been a dog” ever since the 2016 Brexit vote, says Russ Mould for AJ Bell. But as any investor knows, the aim of the game is to “buy low” and sell high. Bargain-hunters sense opportunity. There have been 14 takeover deals in the past month alone. To quote the writer Joseph Campbell, “the cave you fear to enter holds the treasure you seek”. 

Private-equity firms have accumulated a global war chest estimated at $2.5trn, says Ben Martin in The Times. Recent bids for the AA and McCarthy & Stone show they are ready to spend in London. Data from Peel Hunt shows that there have been £22.8bn-worth of bids for London-listed firms since the start of August, never mind the awkwardness of negotiating a multimillion-pound acquisition over Zoom. 

There could be more to come. Some potential buyers are reportedly holding back while London and Brussels hash out a deal. When there is more clarity on that point, they stand ready to swoop.

Recommended

Will energy prices go down in 2023?
Personal finance

Will energy prices go down in 2023?

Wholesale gas prices are on a downward trajectory, but does this mean lower energy bills later this year?
27 Jan 2023
Best regular savings accounts – January 2023
Savings

Best regular savings accounts – January 2023

You can earn an attractive rate on the best regular savings accounts. We tell you the best on the market to take advantage of right now
27 Jan 2023
Equity release v downsizing – which is best?
Personal finance

Equity release v downsizing – which is best?

Equity release hit a record high in 2022. But is downsizing a better way to hold on to your money?
27 Jan 2023
Self-assessment tax returns: what you need to know about getting your tax bill right
Income tax

Self-assessment tax returns: what you need to know about getting your tax bill right

Understanding how self assessment works can help you ensure you pay the right amount of tax, as well as avoid penalties for missing the deadline.
27 Jan 2023

Most Popular

House prices could fall 30%. Should investors be worried about a repeat of 2008?
Investments

House prices could fall 30%. Should investors be worried about a repeat of 2008?

Some analysts are predicting that house prices could fall as much as 30%, which, when compared to the fact that prices have jumped 28% since April 201…
24 Jan 2023
When will interest rates go up?
UK Economy

When will interest rates go up?

New interest rates will be announced on 2 February – we look at what to expect.
26 Jan 2023
Is the State Pension triple lock doomed to fail?
Pensions

Is the State Pension triple lock doomed to fail?

The State Pension triple lock guarantees an increase in the state pension every year, but this assumes government income grows every year as well, whi…
25 Jan 2023