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300 years of technology M&A - Brexit in context

Information Age asked Nick Field for his thoughts on the before and after effect of Brexit on the UK technology M&A Industry.

The before and after effect of Brexit on the UK technology and M&A industry; it's certainly not negative.

Britain's unexpected decision to leave the European Union earlier this summer had initially provoked uncertainty and ambiguity in the UK technology and M&A industry. However, markets bounced back quickly, and M&A transactions , particularly those with a technology focus , have seen a flurry of activity since then, with foreign investors seizing what is now seen to be a unique opportunity. Before the vote, M&A activity had rocketed in previous years, with the global market valued at a staggering $4 trillion. All the way back in 1775, someone called Matthew Boulton, then co-owner of a successful metal-working business, bought out the two-thirds interest John Roebuck held in James Watt's condensing steam engine for £1,200, amounting to just over £100,000 at current prices.

The next significant development in this industry was seen almost 100 years after the Joint Stock Companies Act of 1862, which marked the birth of shareholder capitalism and the separation of the creation of value in businesses from the entrepreneurs behind them. The rise of incorporation also created shareholder reporting and regulatory filing obligations that began to provide reliable M&A data. As a result of these developments, technology M&A activity was flourishing by the late nineteenth century, see chart.

As technology continues to reinvent itself, M&A activity will continue to capitalise on these opportunities. The future for the technology M&A industry looks resilient and is set to overcome the initial uncertainty caused by Britain's decision to leave the European Union this year. In recent weeks, Arrowpoint Advisory has experienced a steep rise in activity surrounding technology M&A, including our work with CSL Dualcom, an international Critical Connectivity provider specialising in machine-to-machine communications, which has been acquired by Iconiq Capital, Norland Capital and RIT Capital.

These recent transactions confirm that the UK's vote for Brexit has not negatively affected M&A activity to the degree that many expected.In fact, industry has seen the complete opposite effect .The long history of successful M&A technology transactions looks unlikely to end anytime soon.

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Nick Field

Director

Phone: +44 20 7484 4738

Mobile: +44 7501 023529