Navigating business value after the EU referendum
September 16, 2016
In this blog and the attached paper, we share our views on the business valuation inputs and assumptions that need additional attention following the UK’s vote to leave the EU.
The initial market volatility observed directly after the ‘leave vote’ appears to have reduced in the subsequent few months, leading to positive, yet cautious optimism about the outlook for UK companies’ valuations over the short term.
In the medium term, we may observe further volatility in the UK stock markets, as the Government develops and communicates more details of the proposed ‘Brexit’ plans and market participants update their forecasts and strategies.
We share our views on the following important valuation questions:
Although a number of deals were put on hold immediately after the ‘leave’ vote was announced, the UK deals market remains active. In the few months after the UK’s ‘leave’ vote, some of those deals have resumed, and some remain indefinitely on hold. Sterling's depreciation has added to the attractiveness of opportunities perceived by overseas investors for deals in UK based businesses.
To read our recommendations for navigating current business valuations and avoiding some of the future pitfalls that lie ahead, please download your copy of our report here.
I hope you find this article useful. I’d really like to hear your views. Please get in touch with me or anyone in the PwC valuations team (contacts listed in the attached pdf) if you’d like to discuss any of the points raised. Alternatively, do share a comment below.