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Transaction volumes in Q1 pick up preceding the impact of COVID-19

13 May 2020

The M&A market experienced a busy Q1 2020, with a 13.2% quarterly rise in transaction volumes, according to analysis from accountancy and business advisory firm BDO LLP.

BDO’s PCPI / PEPI* quarterly report shows that sentiment was overwhelmingly positive at the beginning of the year, with trade deal volumes resurging by almost 20% to total 506 deals, reflecting pent up demand in the market. This buoyancy was recorded despite volumes in the Private Equity (PE) market tapering off somewhat to 76 deals, the lowest quarter for two years.

Deal values in Q1 also maintained a strong profile before COVID-19 hit, with trade multiples increasing from 9.5x to 10.1x and PE multiples fluctuating from 12.2x to 11.8x.

The decline in the FTSE all share to 10.7x reflects the sharp market contraction at the end of the quarter as the UK-wide lockdown was imposed due to the coronavirus pandemic. The lockdown was a compelling indicator of a decline in M&A activity over the coming months, as businesses divert attention away from deals to focus on more immediate priorities.

Roger Buckley, M&A Partner at BDO, commented: “Pre-lockdown, we saw a healthy M&A market in the UK, with much of the quarter’s deal activity preceding the impact of COVID-19. We expect to see a significantly reduced volume of M&A activity in Q2.

“Deal completions in Q2 are likely to be centred on businesses which are trading in sectors less impacted by COVID-19, such as technology, pharma and parts of the healthcare sector. Whilst it is too early to say what the M&A market will look like in the second half of 2020, we anticipate a significant variation in both M&A activity and value impact, by sector and sub-sector. The hardest hit sectors may not see a resumption of M&A activity until 2021.”


*Private Company Pricing Index / Private Equity Pricing Index

Note to editors

Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.

Our clients are Britain’s economic engine – ambitious, entrepreneurially-spirited and high-growth businesses that fuel the economy. 

We share our clients’ ambitions and their entrepreneurial mind-set. We have the right combination of global reach, integrity and expertise to help them succeed. 


BDO LLP operates in 17 locations across the UK, employing nearly 5,500 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.

BDO’s global network

The BDO global network provides business advisory services in 167 countries, with 88,000 people working out of 1,800 offices worldwide. It has revenues of $9.6bn. 


Roger Buckley
M&A Partner, BDO
+44(0)121 352 6213
[email protected]

BDO press office:
020 7893 3000
[email protected]