Cross-Border M&A: A Global Perspective

In the ever-evolving landscape of M&A, cross-border deals are becoming a more common route for overseas corporates and investors to access the UK market and accelerate global expansion.

As overseas players strive to tap into new markets, technologies, and talent pools and in some cases, combat slowing organic growth the attraction of cross-border M&A naturally grows.

Overseas buyers play a central role in the vast majority of processes we lead, with around half of the transactions we’ve successfully delivered in recent years ultimately being with foreign players either Europe, North America and Asia.

Cross-Border M&A: A Global Perspective

Increasingly we also see an evolving trend of overseas private equity investors and family offices with the ability and desire to deploy capital in the UK, providing further competition to the already competitive investor landscape in the mid-market.

Despite the volatile geo-political backdrop experienced in recent years, the UK remains an attractive destination for inbound M&A from a cultural, linguistic, economic and innovation perspective.   

This is underlined by our ongoing monitoring of inbound UK M&A activity, with 1,615 deals recorded in 2022 across both overseas corporate acquirers and investors. Unsurprisingly in the current macro-economic environment we project the 2023 figures to fall shy of this 2022 high water mark (likely around 1,350 deals). The long-term upward trend we do however foresee continuing however, particularly from 2025 onwards (Source: RM analysis, powered by Pitchbook).

Let's delve into the key factors that from our experience make UK companies particularly appealing to overseas buyers and investors.

1.    Market Expansion and Access

Expanding into new markets is typically the primary driver for cross-border M&A, with buyers seeking deeper access and distribution capabilities in the lucrative and sophisticated UK market. Although Brexit has created some challenges in business, it has also acted as a driver for foreign parties to invest in the UK as its relationship with the EU has changed

Such expansion can be achieved organically but market penetration tends to be slow and the risk of failure high via such strategies. This is increasingly apparent in sectors where the UK incumbents have a high degree of brand recognition and command strong market positions.

2.    Complementary Technologies, Expertise and IP

Targets that offer complementary technologies, know-how, or expertise can accelerate innovation of an acquirer, often bypassing years of internal development and investment that would be required to generate an equivalent internally.

The opportunity cost of the time taken to internally develop expertise or technology is often a main driver of a strategic acquirer paying an ‘above market’ premium. This is an area we are keen to analyse and understand when running a process. In such situations, the value for an overseas buyer of such an acquisition is broader than the current profit streams of the target, and ultimate deal pricing can be driven to reflect this.

Recent changes to UK legislation through the National Securities and Investment Act (NSI), which came into force in 2021, must however now be considered in some sectors. Specifically implemented to enable the Government to review and block acquisitions by overseas buyers that are seen to potentially impact UK national security, the type of activities that fall into this category are broader than may naturally be envisaged.

3.    Talent Acquisition

Access to skilled and diverse talent pools is crucial for growth in any people-based industry. Acquiring a company with a talented workforce can address talent shortages which have stifled global technology and consultancy corporates in recent years.

The UK market is known for its world leading service industry (being the second biggest exporter of services globally according to the OECD) and overseas buyers continue to look to leverage the skilled workforce we have in the UK to help drive their inorganic growth strategy and develop certain niches.

‘Acqui-hire’ (acquiring a company for its talent ahead of its financials) is a phrase often heard in high value added service niches, and is a trend that continues to drive and we continue to see above market average valuations for companies that fit this criteria.

4.    Diversification and Risk Mitigation

Targets that offer diversification across customers, products, sectors, or geographies help mitigate risks associated with economic downturns or industry-specific challenges, providing a natural hedge across an acquirers’ revenue streams.

Interestingly the conglomerate structure is back in vogue in certain sectors. This we see particularly in industrials and business services where large, often publicly listed European players with significant capital to deploy seek targets they can acquire in full but leave to run with relative autonomy post transaction.

In the case of customers, acquiring a well-established brand with a loyal client base can provide instant credibility in new markets to a level often impossible to achieve organically.


Cross-Border M&A: A Global Perspective

5.    Synergy of Business Models

When two companies share similar business models or distribution channels, the integration process can be smoother, allowing for quicker value realisation.

Both revenue and cost synergies are often attainable via cross-border acquisitions, although potentially to a lesser extent than a domestic buyer may benefit from which represents a closer match in terms of geography and customer base.

Understanding in as much detail as possible the synergistic benefits an acquirer is likely to obtain for an acquisition gives much greater scope to push for a premium valuation that shares in this collective upside.

6.    Financial Performance and Growth Potential

Often a pre-requisite, targets with a track record of consistent financial performance and strong growth potential are the most attractive to overseas buyers and investors seeking to maximise returns on investment.

Particularly attractive are strong future growth prospects with the ability to help an overseas buyer expand in the UK at pace, without the need to invest significant further time and resource to generate this independently of the acquisition target in question.


In a world characterised by ever greater interconnectivity, cross-border M&A is continuing to play a significant role in the UK mid-market landscape.

Whilst the points above highlight some of the key drivers of inbound UK activity, successful cross-border M&A integration can represent a challenge to buyers and sellers. Cultural differences and clarity over the integration plan should be clearly understood from the outset to reduce the risk of an acquisition for both parties.

As the global business landscape continues to evolve, identifying the right targets and executing cross-border M&A transactions with strategic precision can lead to significant value creation, increased market share, and enhanced capabilities that position companies for success in the global marketplace.

Rickitt Mitchell possess a huge wealth of experience in attracting and successfully delivering both inbound and outbound cross-border transactions, with an ability to guide shareholders through the financial, strategic and cultural complexity of such deals.

Kaine Smith | Partner

Cross-Border M&A: A Global Perspective