Lyceum Capital, a UK private equity firm, has published a positive end-of-year report for lower-mid market investment, which is set to continue despite uncertainty over how Brexit will play out.
Lyceum calculated a deal value of £3.33 billion ($4.06 billion; €3.8 billion) for lower-mid market private equity investment in the UK last year. Deal volumes were in a similar range at 82 deals in 2016, compared with 87 in 2015. Foreign private equity investment has increased significantly, with Lyceum reporting that over 90 per cent of their LPs are from abroad.
“I think lower mid-market PE is attractive in the UK for a few reasons: Firstly, in a market context, the UK lower-mid market is the largest by market volume in Europe, providing consistency in the volume of PE opportunities available,” said Andrew Aylwin, a partner at Lyceum Capital.
Aylwin is confident about 2017, despite potential Brexit disruption. “I’ve said for quite a few years now that PE deal volumes will be volatile. Completion timings owe much to specific deal complexities over macro elements. The UK government is overtly focused on driving growth and wealth creation, and any uncertainty is all relative,” he said.
The report was published in collaboration with Cass Business School.