London: A more ‘stable’ economic environment is expected to drive deal activity in the UK logistics and supply chain management sector, according to BDO’s UK M & A Update – Q2 2024.
The report notes that for the second quarter in a row, the number of deals has fallen. Nearly two-fifths of deals were cross-border, with most transactions in Q2 trade deals.
Jason Whitworth, M & A partner, BDO said: “With the expectation of a more stable economic environment we are anticipating a more positive outlook. This is supported by the significant deals we have seen announced this year and the continued investment in technologies aimed at driving further efficiencies.
“Alongside the positive deal activity, we continue to see an increasing level of distress and financial pressure, particularly in smaller transport businesses that are managing increased cost pressures across operations, fleet and regulatory requirements, whilst also managing moderated volumes and more customer pricing pressure, Whitworth said.
“Tech investment definitely remains a key driver of activity as investors look to offer the next leading edge service proposition to customers. Appetite in UK assets from international consolidators remains strong.“This continues to demonstrate the value in quality market leading UK businesses with scale, quality customers and excellent service potential.”
Prominent deals in Q2 2024 included the completion of GXO’s acquisition of Wincanton for a reported £762m. Pharma logistics is also a growing area of interest, highlighted by the acquisition of Cryoniss, a temperature-controlled storage and logistics business servicing the pharmaceutical and biotechnology sector, by UK-based biotech company, Biofortuna.
