Private equity activity in the Midlands’ mid-market sector saw a notable decline in the first half of 2023, with deal volumes dropping by nearly 25%, according to KPMG UK’s mid-year private equity report. A total of 41 transactions were completed, mirroring the region’s performance in the first half of 2024.
The decrease in deal activity is largely attributed to economic uncertainties, including geopolitical tensions and potential trade tariff impacts. Despite the slowdown, bolt-on acquisitions remained the dominant deal type, accounting for over 50% of the region’s transactions. Leveraged buyouts (LBOs) followed in terms of deal volume, with minority investments taking the third spot.
The Midlands contributed 11% of the UK’s total mid-market private equity deals, with the sector’s performance seeing a nationwide downturn. Only the South West bucked the trend, experiencing a rise in activity compared to H1 2024.
Even with this decline, the Midlands continues to attract interest, with investors showing confidence in businesses with strong management and proven growth strategies. The second half of 2023 holds potential for cautious optimism, particularly for firms demonstrating resilience in uncertain times.
