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Acquisitions in Scotland 2003-17


This report updates the previous research into the acquisitions market in Scotland, extending the period of data analysis from 2003 to 2017. The research had two aims: to provide comprehensive and thorough data on Scotland’s acquisitions market, to help ensure policy is made based on robust evidence; and to look at acquisition as a tool for economic growth. The data and experience of those who have been part of acquisition tells us it is being used for growth – and used successfully, by some Scottish companies.


As with the previous report, the bedrock of the analysis was developed using the ZEPHYR database. The analysis has not only brought the content available for analysis up-to-date through filling the years 2013 – June 2017, but has added additional deals to the previous years (2003-12) making these figures more robust.


The updated data reaffirms many of the key findings in the prior research. Scotland’s performance in a UK and international setting is broadly comparable to elsewhere. The main difference is Scotland sees fewer acquisitions by its companies compared to all other regions in the UK and all other nations used for comparison. Scottish companies are acquired internationally and domestically at a lower rate than several similarly sized economies. Scotland has the highest post-deal active rates of all nations for inward acquisitions. Scotland has a significantly higher post-deal active rate in outward acquisitions (as do all nations), but ranks in the lower half across the comparator nations. Of those making acquisitions, over 90% of acquisitions made by Scottish companies are of firms within the UK, a higher rate of reliance on one market than any other nation. New UK regional analysis also highlights London’s central role in Scotland’s acquisitions activity, with 19% of inward acquisitions of Scottish companies originating in London, and 23% of outward acquisitions by Scottish companies were of London based companies. Acquisition activity occurs earlier in the life span of companies in Scotland than elsewhere by a considerable distance. Median deal sizes (from available data) are broadly comparable suggesting Scottish companies are not considerably smaller despite being much younger. This suggests that in Scotland, acquisition may be a tool used by faster growth companies.


Whilst making no recommendations, the research identifies a series of policy and research questions for further consideration. It suggests the main area of focus should not be on foreign companies buying Scottish firms, but the lack of acquisition activity (of all types) by the Scottish business base. If we accept acquisition is one potential avenue to achieve growth then it is one companies are either not aware of, not able to undertake, or not willing to. This has consequences in the wider economy with a lack of recycling of talent, knowledge and funding. A lack of acquisition deals means these assets are not released back into the economy to stimulate other companies to grow, to learn and to benefit from unlocked experience, knowledge and investment; and potentially creates a cycle which perpetuates a lack of acquisitions. Scotland performs better in international comparisons for companies’ post-deal active status when acquired than when acquiring. It suggests policy-makers could be more confident in existing measures which are successful at embedding companies in Scotland. This also suggests support and advice could be beneficial, not just for those considering acquisition as a route to growth, but also for companies undertaking it.

Author Scottish Enterprise
Published Year 2018
Report Type Research
  • Enterprise
    Entrepreneurship/new firm formation
  • Internationalisation
    Inward investment, Internationalisation of Scottish businesses