Alan Kelly: Deals keep flowing despite gloomy mood

Alan Kelly, corporate finance partner at MacRoberts. Picture: Contributed

Alan Kelly, corporate finance partner at MacRoberts. Picture: Contributed

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The Scottish business news has recently been full of gloomy headlines outlining a lack of confidence.

According to the latest study from the ICAEW and Grant Thornton, business confidence in Scotland has fallen into negative territory for the first time in 12 months and is among the lowest in the UK.

Is this lack of confidence justified? Although key constitutional questions remain open, it is our experience that many sectors are still attracting interest from overseas and from within the UK.

Deals in which we have been involved – such as the acquisition of Machrihanish-based wind turbine infrastructure firm Wind Towers Scotland by the South Korean company CS Wind Corporation, which plans to invest up to £14m in Scotland and create up to 70 new jobs in rural Argyll, and the sale of the Scottish plants of Tata Steel to the international group Liberty House – show that there is still interest in Scotland.

The continued UK growth of Munich-headquartered TÜV SÜD through its acquisition of Dunbar & Boardman, a London-based consulting and planning services provider, is another example. TÜV SÜD is one of the world’s leading technical service organisations with a large presence throughout Scotland.

In Dundee’s active life sciences sector, we acted in the sale of CXR Biosciences. The business was bought by Concept Life Sciences, an international scientific laboratory and consultancy business working in the life, food and environmental sciences sector. We also acted in the $400 million (£274m) sale of Scottish drug discovery company IOmet Pharma to US giant Merk & Co.

One of the biggest deals this year saw us act for long-term client Johnston Press in the Edinburgh-headquartered group’s acquisition of the i newspaper, which is published throughout the UK.

READ MORE: Johnston Press agrees £24m deal for i newspaper

We are also seeing new enquiries from the United States and outwith Europe in other sectors. Many of these companies are keen to get a foothold in the UK or European markets. Others see the opportunity in the acquisition of skills, knowledge or intellectual property.

There seems to be a perception in some countries that Scotland is a country which is keen to engage with the wider European market. When these countries are therefore looking to access the UK or European markets, this seems to be standing in our favour.

As well as interest from overseas, we are also finding that the availability of cash from Scottish banks, private equity groups and other investors is promoting activity. There are still lots of opportunities for Scottish-based businesses looking to buy or sell or raise investment.

Our own deal activity for the last 12 months or so, and our current pipeline, is testament to this. Despite all this, with the current political uncertainty, it looks like it may be hard for some businesses to feel more confident.

• Alan Kelly is a corporate finance partner at law firm MacRoberts

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