Growth, resilience and adaptability – the state of the North East deals market

By Duncan Reid, partner at Weightmans LLP

Businesses across the North East have weathered economic downturns before. From our experience of working with owner-managed businesses across the region, we never cease to be impressed at the levels of resilience, innovation and adaptability business leaders demonstrate to grow their businesses. This is becoming especially clear as we emerge from the shadow of the last 18 months.

While the all-encompassing nature of Covid-19 has been unlike anything we have experienced before, signs of recovery are gradually gathering pace. The UK’s economic outlook is proving more positive than ever seemed possible this time last year – and the activity we’re seeing in corporate transactions only serves to reinforce this.

Across every sector, North East businesses are pushing for growth. The volume of transactions across the region remains strong, driven primarily by private equity firms that have cash to invest.

A recent example is Hicomply, whom we advised on their £3million investment by BGF. Its software platform gives companies the tools they need to build their information security management systems and the team was looking to accelerate growth through investment in its sales and marketing offering. Now, it is preparing to roll out new and refined technology offerings to support its clients.

Buy and build has also emerged as a key strategy for ambitious OMBs looking to target growth. We know that acquisitions, or mergers with bigger players in the market, can be an effective means of diversifying, creating resilience and building scale quickly – all vital traits for businesses with ambitious expansion plans.

Our team also advised J&B Recycling, a waste management and recycling business, on its acquisition by Urbaser, one of Europe’s largest environmental services providers, in August this year. Now, J & B is continuing to provide best-in-class recycling services to its commercial and local authority customers. With the fresh backing of Urbaser, it is accelerating its goal of achieving a 100 per cent waste-free operating model.

These trends are set to stay, and it’s those with the experience and on-the-ground presence that are best placed to offer support. That’s why we’re continuing to actively recruit for new partners in our Newcastle office, across corporate, real estate, commercial litigation, insurance, insolvency and private client. And we have already made seven appointments to the team in 2021, including four solicitors and three new principal associates. All of our appointments were made in response to the growing demand for services from clients both existing and new.

There will inevitably be bumps in the road ahead for the region. Ongoing disruption to supply chains and the issue of labour shortages will test many firms in the coming months. But we know that the North East’s business leaders are working hard to shore up their firm’s resilience, seizing every new opportunity for growth.

Collaboration between the region’s businesses and the wider corporate finance community will remain a key driver of this growth, and of wider economic recovery, in the months ahead. We know that even in the most challenging times, entrepreneurs and business leaders are driven by a fundamental need to grow. It will take drive, ambition and nerve, but we know that adversity always creates opportunity – and we’re committed to working with OMBs across the North East to help them emerge stronger.

This was posted in Bdaily's Members' News section by Weightmans .

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