Last week a survey from Lloyds reported a rise in North West business confidence and Liverpool lawyer Paul Abrams of Gregory Abrams Davidson says entrepreneurs are showing an appetite for risk in a ‘buoyant’ M&A market. Tony McDonough reports
Liverpool corporate lawyer Paul Abrams has told LBN that investors and entrepreneurs in the SME market are defying messages of economic gloom and are willing to take risks.
Paul specialises in mergers and acquisitions (M&A) for Gregory Abrams Davidson (GAD), a Liverpool city region-based law firm that also has an office in London and works with businesses both in the UK and the US.
Earlier this month the latest Business Barometer from banking giant Lloyds showed a rise in business confidence among North West firms. Given the prevailing economic uncertainty that data raised a few eyebrows.
However, Paul backed up the survey by claiming the M&A market in the North West had become “buoyant” since May and says there has been a notable uptick in both enquiries and deal volumes.
He typically focuses on deals from a micro level up to around half a million pounds. Around once a month bigger deals in the £750,000 to £2.5m range also come across his desk.
And another surprising aspect is one of the biggest sources of the uptick in M&A activity, according to Paul, is hospitality. This is a sector whose recent struggles are well documented.
“There are a number of restaurants in the pipeline at the moment,” he explained. “I completed a deal in the Wirral a couple of weeks ago. I also have a restaurant in Manchester that is due to complete any day now.
“Location counts and the fundamental part is the innovation. The buyers see the value in the type of food being served. Where I live there is a market that has done really well and its model has been replicated elsewhere.
“Those types of businesses are busy and if you get the food right and you get the right location, then people will come. My clients see the value in investing in businesses such as those.
“In some cases the deals are being done because the owners want to sell up and retire. There are some inquiries about restaurants that haven’t done so well but I am mainly dealing with real value that investors are keen to take a chance on.”
“Despite the volume of work in this sector we are not sector-specific. Earlier this year I worked on the sale of an established Liverpool taxi business. We will look at any deal that comes to the table as long as the client is relatable and there is definitely an opportunity there for us to work with them. We will cover all sectors.
“In comparison to last year I would describe the market as buoyant. 2024 was a really difficult year for M&A. What we were finding is we were looking more at refinancing and restructuring.
“This year there seems to be an uptick in M&A and deals. From what I have heard the market seems to be positive. People are keen to find the next opportunity and run with it.”
Paul acknowledged that uncertainty still hangs over the global economy, particularly with ongoing conflict in Ukraine and the Middle East. But he insists that, from what he is seeing, the appetite for risk among both investors and entrepreneurs is strong.
He added: “There are people with cash in their pockets and they are looking for opportunities to work with young bloods who are ready to get into an industry and make their mark and develop their skillset and vision.
“We know, of course, that a high percentage of start-up businesses will fail but, from what we see, people aren’t afraid to take the risks. They are not worried about failing. That is what I see every day.
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“We are seeing that in our work in the US as well. Deals are coming to the fore. That all generates positivity.
“This is a globalised economy and we speak to people from all over all the time and technology means we are simply not as restricted by geography in the way we once were. It could be a client in the US or the Middle East. Technology has made the world smaller.
“I don’t mind who I work with and where they are from as long as we get on and we can do business.”