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UK domestic M&A deals slump to 30 year low after Brexit vote

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The value of merger and acquisition deals between UK companies has plunged 62 per cent to a 30 year-low since the country's vote to leave the European Union, according to Thomson Reuters data, in a sign of the uncertainty gripping businesses.

[LONDON] The value of merger and acquisition deals between UK companies has plunged 62 per cent to a 30 year-low since the country's vote to leave the European Union, according to Thomson Reuters data, in a sign of the uncertainty gripping businesses.

Domestic deals since the June 23 referendum have totalled US$1 billion, the data show.

Foreign purchases of British firms have also slumped 69 per cent, according to the figures, despite a sharply weaker pound.

Softbank's US$30.7 billion deal to buy UK-based chip designer ARM Holdings in July had sparked hopes among bankers that the fall in sterling might boost dealmaking.

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The data also show spending by British companies on foreign deals has leapt by 59 per cent since the Brexit vote to US$88.5 billion, the highest since 2007 on a comparable basis.

But this number is distorted by British American Tobacco's US$57.8 billion offer for US cigarette maker Reynolds American Inc.

2015 was a record year for dealmaking involving UK-listed companies thanks to a series of jumbo deals including Anheuser-Busch Inbev's US$110.3 billion acquisition of SABMiller and Shell's US$53 billion merger with BG Group.

REUTERS

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