Overseas appetite for UK retail sector M&A soars

New analysis from Grant Thornton UK LLP finds that overseas interest was a significant force in deal activity in the UK retail sector in 2021, with overseas acquirors present in 43% of deals across the year, the highest level of activity seen in a decade.   Notable deals include US private equity group Clayton, Dubilier & Rice’s £7bn takeover of Morrisons and the £4bn acquisition of Selfridges by Thai-Australian alliance, Central Group and Singa Holding. 

This is a significant increase compared to before the pandemic (2019), when overseas acquirors accounted for 35% of deals.   

Nicola Sartori, Head of Retail at Grant Thornton UK LLP, said:  
“The UK is once again seen as an attractive proposition for international investors. The uncertainty surrounding Brexit that for many years made acquirors reluctant to invest in the UK has largely disappeared and the nation has regained its foothold as a strategically important market.”  

Grant Thornton’s research also found that in Q4 2021, traditionally the busiest time of year for retailers and shoppers, investors and trade buyers were on a spree of their own, acquiring 19 UK-based retail companies. This took the total volume of UK retail and consumer deals in 2021 to 65, the highest level since 2017.  

Disclosed deal value for the sector in 2021 returned to pre-COVID-19 levels, up at £13.5 billion, compared to £7.9 billion in 2020. This reflects that deal activity all but ceased in the early days of coronavirus but returned in force in 2021. 

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