Daniel Black
Hello,
Business seems to be picking up in the last week of January. Our Deal Tracker includes confirmation of several notable deals and there are whispers of a few eyecatching megadeals in the works, including KKR’s rumoured £4.8bn takeover of renewables company Cubico.
My highlights include:
- HSBC rolling back on M&A in Europe and the Americas
- Car parts group Dowlais agreeing a £1.2bn US takeover
- BHP cooling its interest in rival Anglo American
Enjoy the read and do connect with me on LinkedIn.
Deal Tracker
Our weekly roundup of all the confirmed M&A deals in the UK.
The Rumour Mill
- The UK’s new PISCES exchange, launching in May, could attract private companies but risks London’s public listings
- Serica Energy shifts M&A focus back on the North Sea, choosing to grow its oil and gas operations domestically despite higher windfall tax
- M&A in RIA hit record highs in 2024
- UK’s booming fried chicken market can grow further, says Popeyes boss
- PM and Chancellor met FTSE bosses to discuss boosting economic growth and attracting more investment
- Reeves promises changes in March if needed to meet budget rules
- Morgan Stanley downgrades its UK GDP growth forecast for 2025 to 0.9%
- The UK’s main stock indexes rose on Wednesday, boosted by gains in the automobiles, tech, and financial sectors, while the pound slipped as US tariffs concerns resurfaced after Reeves’ remarks on resetting ties with EU and US
- UK Banks seek £400-500bn in reserves from BoE as it reduces its balance sheet
- HSBC is cutting investment banking in Europe and the Americas to focus on Asia and the Middle East, while also shutting down its international payments app Zing just a year after launch to trim non-core businesses.
- Chairman Mark Tucker reaffirmed HSBC’s commitment to stronger UK-China ties, reflecting its shift towards Eastern growth.
- WH Smith explores a sale of its 520 high street stores to focus on its more profitable travel business, a move that could trigger a default event on its convertible bonds. While investors reacted positively to the shift, the potential sale raises fiscal risks and could shrink WH Smith’s UK footprint.
- International Paper receives EU approval for its £5.75bn acquisition of DS Smith
- American Axle & Manufacturing (AAM) agrees to acquire GKN Automotive owner Dowlais Group for £1.2bn
- LVMH sells Stella McCartney stake to founder after downturn
- Swedish telecom group Telia agrees agreed to sell its 9.6% stake in Marshall Group to HongShan for £84.4m, as the main part of the acquisition concludes
- Blackstone nears a deal to take full control of UK railway arches
- Anglo American emerges as the top European M&A target for 2025, according to a Bloomberg survey of M&A experts. Despite this, BHP puts its takeover plans for Anglo on ice after previously being rebuffed.
- PPHC agrees to buy Texas-based TrailRunner International in deal worth up to £56m
- Enel and KKR are among potential bidders for UK’s Cubico Sustainable Investments, which could be valued at £4.8bn or more
- Britain’s Competition and Markets Authority investigates Iberdrola’s merger with NWEN
- Metro Bank is in early talks to sell performing consumer loan portfolio
- Triton explores £1.67bn sale of Germany’s Kelvion
- Hong Kong’s CKI explores options for a potential sale of UK’s £4bn Eversholt Rail
- CGI is to acquire UK-based BJSS
- SecureWorks edges high as last trading day set for Friday in sale to Sophos
- Accounting Firm CohnReznick is in talks to sell its £1.6bn stake to Apax Partners
- Inflexion makes strategic minority investment in Baker Tilly Netherlands
- SKKY Partners makes investment in 111SKIN
- Dolphin Capital makes majority investment in Zip World
- QPE supports management buyout of MediMatch
- Esyasoft to acquire UK’s Good Energy in a £99.4m deal
Salaries and bonuses
- Goldman Sachs employees are frustrated over modest bonuses, with tensions heightened by CEE and COO receiving significant retention awards. While BNP Paribas plans only a 5% bonus increase for its staff.
- Payouts for KPMG’s UK partners climbed 9% to an average of £816,000
- Barclays plans to overhaul CEO Venkatakrishnan’s pay, cutting his base salary while capping his total remuneration at £14m
- Citi bonus complaints: “We were told our bonus is keeping our job”
Job moves
- BBVA set to name Jordi Garcia Bosch as new internal chief for Banco Sabadell deal
- Jefferies hires Tim Kerry as co-head of EMEA leveraged finance
- The Bank of London appoints Credit Suisse exec Christopher Horne as new CEO
- Triodos Bank UK promotes Mark Clayton to CEO
- Starling Bank hires new chief banking officer from NatWest Group
- Clear Group appoints M&A managing director as it looks to grow UK footprint
- Astorg makes Partner and Managing Director promotions
- Bridges adds Investment Director for Inclusive Growth strategy
- Palatine makes trio of promotions, including two strategic growth directors
- LDC adds three senior hires to Value Creation Partners team
- RBC Capital Markets hires BNP Paribas director for European markets solutions
- Goldman Sachs names Kelleners and Skoglund head of European dealmaking after shake-up
- Citigroup hires three senior employees for its equities team in Europe
- Ambienta announces 12 promotions to support growth
- Investec, Panmure Liberum and Davy announce minor job cuts this week
- Deutsche Bank cuts £250m in costs by reducing management layers and roles, but continues to add revenue-generating positions in investment banking and trading sectors
Market Trends
UK manufacturers bet on AI and expansion to stay competitive in 2025
Rising costs and global uncertainty aren’t stopping UK manufacturers from pushing forward. PwC’s Make UK Executive Survey 2025 shows that while energy prices (51%) and geopolitical instability (39%) remain major concerns, businesses are focusing on growth. Nearly half (47%) plan to expand their product lines, 37% are looking to new export markets, and 20% identify AI as a top priority.
US investors and AI fuel European PE surge in 2024
Private equity in Europe rebounded strongly last year, with deal value jumping 24% to £450bn. US investors played a major role, participating in nearly one in five deals as they sought diversification and took advantage of a weaker euro. AI also notably emerged as a key driver, with deal value in the sector doubling to £9.4bn.
After a solid year in Europe, PE activity is expected to accelerate globally in 2025. With nearly £2.1trn in uncommitted capital, there is an ever-increasing inventory of aging private-equity owned assets that need to be monetized.
While PE funds are taking longer to close – 16.2 months on average – mega-funds continue to dominate, making up 43.7% of total PE capital raises in 2024. Despite a slower fundraising environment, 80.2% of funds closed last year were larger than their predecessors. A more favorable regulatory environment, particularly in the US, could further drive dealmaking momentum.
M&A trends in energy and renewables
The energy industry is set for a strong year of M&A activity, according to analysis from PwC. The energy transition will remain a key driver for new deals, but “the shape and pace of change will vary significantly by both region and sector.”
PwC notes that Trump’s re-election in the US will likely benefit gas and other fossil fuels, while in Europe the focus will be on renewables and energy storage as countries look to improve their energy security.
