2024 M&A Year in Review - Flipbook - Page 83
M&A Year in Review | 2024
United Kingdom
Europe
Since the July 2024 General Election, the newly
elected Labour government has made a concerted
effort to promote the United Kingdom as an
attractive jurisdiction for inward investment, with a
strong emphasis on health care, defense, clean
energy, and infrastructure as drivers of domestic
growth. Backed by a substantial government
majority in the House of Commons, the government
is expected to pass its flagship legislation with
relative ease, at least in the short term.
Three years after Russia’s invasion of Ukraine, the
conflict’s ramifications remain significant across
Europe, with defense spending emerging as a political
priority among EU member states. This shift is driving
transactions focused on enhancing supply chain
efficiencies and bolstering energy security. However,
the rise of far-right parties, particularly the growth of
the Alternative for Germany (AfD) in Germany,
complicates the political landscape, as these
movements gain traction with support from influential
figures within the Trump administration and its allies,
potentially
reshaping
policy
directions
and
international relations in the region. This evolving
political climate contributes to uncertainty for
businesses as they navigate fluctuating regulations and
shifting public sentiment. Despite the uncertainty, the
need for adaptation to the changing geopolitical
landscape is likely to boost M&A activities in the region.
In parallel, the Chair of the Competition and
Markets Authority has been replaced, and public
commitments from other regulators reflect a focus
on delivering economic growth. Even so, the most
significant impact on the UK M&A market continues
to come from uncertainty over the UK’s position in
response to the Trump administration’s policies on
international trade and geopolitical events. On
balance, domestic political stability, for the time
being, and a renewed focus on regulation for growth,
should create a supportive backdrop for continuing
growth in M&A activity in the near term.
The newly elected Labour
government has made a
conce爀琀ed e昀昀o爀琀 to promote the
United Kingdom as an a琀琀ractive
jurisdiction for inward investment.”
Deal activity in recent years has been dampened by
high interest rates and diverging price expectations.
However, recent interest rate cuts by the European
Central Bank and the continued rise of private capital
have eased the difficult financing environment and
will continue to boost M&A activity.
Driven by the ongoing AI boom and the resulting
demand for technology, the technology sector is
likely to continue to lead European M&A activity in
2025. In addition, energy transition will propel
M&A activity across Europe, as companies leverage
M&A to adapt their business models to meet this
challenge. Lastly, as tariff and trade policy changes
unfold and the automotive sector faces economic
challenges, EU companies are expected to make
significant investments in the United States in an
effort to gain a strong U.S. foothold.
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