The latest global economic conditions survey, published recently by the Association of Chartered Certified Accountants (ACCA), showed that 34 per cent of ACCA members in Scotland enjoyed increased confidence about their organisations’ growth prospects in the second half of 2013, with Scottish businesses enjoying much-improved access to capital for expansion.
The ACCA research, and its findings, mirror the momentum that we, at LDC, are currently seeing in the Scottish market – and not just in our private equity sector. The availability of bank debt through a variety of lenders, resulting in significant potential liquidity, when set alongside a pipeline of potential deals that had stalled over the past few years, means there is a real impetus to transact at the moment.
In addition, positive reactions to major share sales such as Royal Mail and Bargain Booze last year, have opened the market’s eyes and undoubtedly helped boost the renewed confidence. Equally there is a greater appetite to invest in growth by both business management teams and also significant investors.
The overall findings of the ACCA survey signals that confidence in the strength of the global recovery is stronger than at any time over the last five years. One highly encouraging trend amongst Scottish mid-market size businesses is an increasing appetite to expand overseas and we’re seeing a lot of activity taking place with LDC’s team in Hong Kong, as management teams look to capitalise on growth opportunities in Asia.
Investment is essential to help our Scottish businesses achieve growth on a global scale and consequently develop our economy. Capital is available, but the key for most businesses is in finding the most appropriate partner, which essentially means one that understands and supports the ambitions of that business.
LDC invested over £400 million nationally in 2013 and has a strong appetite for further investment in Scotland through 2014 and beyond. The transformative effect of private equity, in giving management financial fire power and the expertise to change a business, can have a significant effect. During 2014 we’ll be looking to work with more Scottish businesses to help them realise their growth plans.
• Nigel Moss is managing director of LDC Scotland