Human Capital M&A Market Review H2 2023

Gambit Corporate Finance’s Human Capital M&A Market Review demonstrates the continued resilience of the UK human capital market in the face of a challenging macroeconomic environment, providing optimism for the year ahead.

Key Points in Focus:

  • Human Capital average deal values increased by 190.8% between Q323 and Q423 as acquirors pursued a flight to quality, seeking to acquire the most premium assets in the UK Human Capital market.
  • $2.6 trillion of ‘dry powder’ is currently held by global private equity firms and is ready to be deployed into acquisitions of UK Human Capital assets with a scrupulous focus on productivity and KPIs.
  • The UK has once again reaffirmed its position as a frontier in the global Human Capital Market M&A, rivaled only by Japan and the USA.
  • Recruiters servicing sub-sectors displaying growth and resilience through recent macroeconomic and geopolitical uncertainty continue to be in the spotlight for global strategic and financial acquirors.
  • EV/EBITDA multiples for publicly traded recruiters have demonstrated significant growth, rising from 5.8x in Q2 2023 to 7.8x in Q4 2023, indicating heightened confidence within the market.
  • The recent softening in the UK’s inflation rate, coupled with a pause in interest rate hikes, suggests potential base rate reductions by mid 2024. This forecast is poised to enhance M&A activity as a reduction in the cost of capital drives an increase in leveraged transactions and investment throughout the UK economy.
  • With expectations of a UK general election set to take place at the end of 2024, it is an opportune time for Human Capital business owners looking to consider their exit options to capitalise on the current capital gains tax regime.
 

To read the full report, click here.

 

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