FEATURE
It’ s not all doom and gloom on the mergers and acquisitions scene, says Lee Humble, head of corporate finance at Azets...
CLOSING THE DEAL
Demand – Lee Humble says UK and international buyers will always be interested in quality businesses.
The UK M & A( mergers and acquisitions) landscape feels hard to predict. Fluid. Subdued. It’ s also not quite what you might expect – but not all is lost.
Deal volumes vary depending on the size, sector and location of what is analysed.
At Azets we continue to see, support and execute a high volume of transactions for businesses.
For regions such as Teesside and the North-East, the medium-term outlook remains encouraging for those with their finger on the pulse, with local businesses and sector clusters attracting increasing attention from UK and international buyers.
With this in mind, a number of positive trends have emerged:
1. Flight to quality Investors are prioritising resilience over speculation. Businesses with strong cash generation and structured growth trajectories are achieving premium valuations, even under cautious market conditions.
2. Increased transaction structuring To mitigate valuation uncertainty and align post-deal incentives, more deals are incorporating earnouts, deferred consideration and rollover equity.
3. Private equity selectivity and specialisation Private equity funds remain active but increasingly focused. Many are doubling down on sector specialism and adding value through buy-and-build strategies.
4. Extended timelines Due diligence is more detailed and investment committees are more cautious, leading to longer lead times from approach to completion.
The North-East continues to be strong for investment and acquisition activity, underpinned by its industrial base, skilled workforce and emerging innovation sectors. Teesside has benefited particularly from high-profile regeneration initiatives and targeted government support.
Though the region accounts for a modest proportion of overall UK deal volume, the quality of opportunities – particularly in manufacturing, energy and process industries – has drawn sustained attention from trade buyers and private capital.
Several sectors in our region are generating consistent M & A activity, both from inbound investors and regional consolidation.
1. Business and professional services In this sector, valuations remain attractive for firms with recurring revenues and scalable delivery models.
2. Technology and digital services Regional universities and innovation hubs are supporting early-stage growth businesses in software, cybersecurity and data analytics. Trade buyers and growth funds are active in the space, particularly where firms can demonstrate IP, user stickiness or platform potential.
3. Chemicals and process manufacturing Teesside’ s prominence in the process industries, bolstered by the NEPIC cluster, continues to generate international attention. Sustainability-led innovation and international demand for speciality production are also attracting interest.
4. Clean energy and net zero infrastructure With multi-billion-pound projects in development across carbon capture, hydrogen and offshore wind, the region is well-placed as a clean energy hub. M & A, joint ventures and strategic partnerships are emerging as key mechanisms for deploying capital and accelerate innovation.
In uncertain or complex market conditions, the benefit of working with an experienced, well-connected corporate finance adviser is amplified.
Advisory teams not only manage process execution but also play a central role in strategic positioning, buyer engagement and deal preparation.
Strategic benefits include: > Network reach: Advisers with national and international buyer and investor networks broaden the universe of potential counterparties.
> Transaction readiness: Preparing businesses for market( including diligence packs, financial forecasts and legal preparation) ensures stronger valuations.
> Valuation maximisation: Advisers help articulate growth stories, align on pricing expectations and structure deals that protect long-term value for shareholders.
> Deal navigation: Advisers help manage negotiation dynamics, resolve issues and maintain deal momentum.
In Teesside and the North-East, the outlook for 2025 and beyond is shaped by: > Investment in clean energy and infrastructure > Strong regional sector clusters > High-quality businesses seeking capital or exit
> Government policy aligned with regional regeneration.
The region’ s M & A environment is defined by a careful balance of risk and opportunity. While broader global and political uncertainties have led to a more selective buyer appetite, strong businesses continue to attract attention and transact at high rates.
If you have any questions around any of the above, get in touch with one of our team today. Visit azets. com / en-uk / services / corporate-finance for more details.
The voice of business in the Tees region | 81