Private Equity & Investors
UK Budget: Sean O’Flynn, Partner & Managing Director and EMEA Leader of M&A and Transaction Advisory at AlixPartners, comments on the Autumn Budget 2024:
"With the Autumn Budget now unveiled, we're seeing a breadth of measures that will shape the M&A landscape in the coming months. The Chancellor's tax adjustments, particularly those concerning capital gains tax, are going to have an immediate and major impact on deals across both the buy-side and sell-side.”
“For investors and private equity firms, the adjustments in capital gains tax could impact exit strategies, compounded by a 4% increase to the carried interest capital gains tax rate, potentially compressing returns across the industry. Sellers may look to fast-track their timelines to maximise tax efficiencies before changes take hold, while buyers will need to tweak valuation models to ensure they stay competitive in the market.”
“The increase in employers' national insurance contributions, aimed at raising £20 billion for public services, will also affect business costs, which could have a knock-on effect for potential sellers with a high employee count.”
“With a new fiscal landscape laid out for businesses, there’s a clear need for thorough tax planning and portfolio management to ensure alignment. As the transaction environment evolves, organisations and investors must remain agile in response to these regulatory changes to seize M&A opportunities effectively."