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High value acquisition targets revealed in new report

High value acquisition targets revealed in new report

Published on: 3/11/2017

Traditionally, a typical acquisition strategy revolves around acquirers looking for a cut-price deal by preying on struggling and vulnerable businesses. The UK Food Manufacturing industry is no different.

However, new research into the financial health of the UK Food Manufacturing market by leading business analysts Plimsoll Publishing suggests this needs to change over the next 18 months.

Plimsoll’s latest report into the largest 1488 Food Manufacturing companies operating in the UK has identified 201 “high-class” acquisition targets which would enable prospective new owners to move into growing and highly profitable areas of the market.

Despite the fact these categories of companies are likely to cost a premium, these “high-class” targets offer potential investors a real opportunity to strengthen their position in the market and allow the company to continue on its upward trajectory.

Further findings from Plimsoll’s November 2017 Food Manufacturing Report details: 

  • 201 “high-class” acquisition targets have been named in the latest Plimsoll Report
  • 98 of these companies are highly profitable – these businesses offer the chance to move into a profitable area of the market and by being privately owned could make negotiations less arduous
  • 24 companies are growing at over 10% – these companies are among some of the most successful in the market

Plimsoll’s senior analyst, David Pattison, added: “It is a long-standing debate, when considering an acquisition, do you buy cheap or high value? In reality, most people’s idea of an acquisition is to wait until the business has declined so far meaning the only option is for a new owner to come in and save the business – essentially spending peanuts. However, we feel this approach needs to change. The acquisition strategy should be based on the direction of the current market. By acquiring a successful business, it gives both the company and the new owners a chance to add new investment and further cement their position in the market, whilst the current owners may feel they have taken the business as far as they can.”

 Plimsoll’s latest study into the 1488 major players in the industry also reveals:

  • 684 companies have been rated as Strong
  • 114 businesses have lost a third of their value
  • 304 firms are making a loss

For over 30 years, the Plimsoll Analysis has been used by senior decision makers to help monitor competitors, analyse key market trends as well as identifying acquisition prospects.

The Plimsoll Food Manufacturing Analysis is available to buy by clicking here. The Analysis examines the largest 1488 companies operating in the UK as well as the 201 high class acquisition targets. For any other questions or enquiries, please contact Chris Glancey on the details below.

E: chrisg@plimsoll.uk

T: +44 (0) 1642626419

W: www.plimsoll.uk

 

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