Christmas isn’t the only season for bargain hunting. Foreign investors have been snapping up cut-price UK companies throughout the year. Data from the London Stock Exchange Group shows that overseas bidders agreed $142bn worth of takeovers of British firms in the 11 and a bit months to December 17 this year — a 74 per cent increase on the same period in 2024. US buyers and private equity groups have driven much of the activity, with financial, real estate and industrial companies proving the most attractive targets. A handful of deals may still be completed before year-end.
The apparently buoyant demand is double-edged. In part, it reflects attractive pricing. Relative to peers in other developed markets including not just the US but also European countries, UK companies have appeared notably cheap for much of the past decade. The valuation gap highlights persistent failures by successive governments and regulators to pursue the right policy measures to boost London’s flagging stock market — which still need to be addressed.
But discount valuations are not the only driver. Buyers are attracted by quality assets and opportunities. For instance, Spectris, a specialist maker of high-tech instruments was the subject of intense bidding in the summer. The US private equity firm KKR completed its acquisition of the company this month. In January, Danish brewer Carlsberg completed its takeover of the UK’s Britvic, a soft drinks giant with global export reach.