KEY players in the Yorkshire region are becoming more confident about prospects for mergers and acquisitions and funding.
TheNorthern Private Equity Confidence Survey from Deloitte gauges the mood of the Yorkshire and north-west corporate markets – and collates the responses of bankers, corporate lawyers and private equity investors.
An overwhelming 95% of respondents expect deal volumes to rise or remain at least at similar levels to 2010.
Deloitte said this represented a welcome signal of confidence in the markets as the flow of deal making activity last year showed a marked increase in deals completed with values exceeding £50m in 2010 compared to the previous 12 months.
While the majority expected debt multiples to remain at similar levels to 2010, in a reversal of last year’s results, a larger proportion of bankers – when compared to private equity investors – expected to see more debt in deals this year.
Paul Roberts (pictured), a corporate finance director at Deloitte, said: “The fact that there is a trend of bankers expecting a higher proportion of debt in capital structures relative to investors, may be an indication that there is a belief from those inside the banks that there is further bank funding available this year. However, it is likely that the quality of businesses being offered these deals will still be higher than a few years ago.”
Despite some bankers’ increased confidence in the likely proportion of debt in deal structures, they remained more pessimistic about the rate of economic recovery than private equity investors.