What does Thursday’s General Election mean for M&A?

Both the main parties have promised changes to the Mergers and Acquisitions (M&A) rules in their manifestos. But what do they mean for people looking to buy and sell businesses?

The Conservatives want to update the rules to protect businesses from asset strippers, those who buy businesses with the intention of making a fast buck rather than running the business for the long term. They want to force acquirers to be clear about their intentions from the moment they make an approach and make any promises made during the takeover process legally enforceable.

The Labour party wants to change the M&A rules to enhance workers’ rights. They want to amend the Takeover Code to protect workers and pensions, roll back some of the 2014 TUPE changes that govern how employment transfers when part or all of a business is taken over, and give workers first refusal if the company they work for is put up for sale.

In both cases, the manifestos aren’t clear whether the proposals will affect businesses of all sizes or how they will be implemented. We will need to see more detail when we know who wins Thursday’s election.

The market for business sales is buoyant at the moment. We are seeing lots of interest in the businesses we are selling and we are achieving prices much higher than the aspirational prices business owners bring to us – currently our average uplift is 40%. Whoever wins, and however the rules change, we believe that great businesses following our tried and trusted sales process will continue to have no difficulty getting a good price.

Call us on 0118 959 8224 or email info@evolutioncbs.co.uk for information about buying or selling businesses

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