The purchase of hazardous waste firm Augean by London-based Ancala Partners for £341 million topped the list of private equity deals in the 12 months to September.
The company, which has divisions in both Aberdeen and Peterhead, was bought by newly formed company Eleia, a special purpose vehicle formed by investment funds managed by Ancala Partners and Fiera Infrastructure of Canada after a successful bid.
The deal helped contribute to the value of takeover and merger deals on London’s junior stock market, AIM, jumping nearly 155% in the past year, according to new research.
Yorkshire-based Augean operates across the hazardous waste management, oil and gas, nuclear and radioactive sectors.
Augean’s North Sea services subsidiary is based in Aberdeen.
DBay Advisors’ £240 million 75% stake in Telit Communications, which provides Internet of Things software, also made the list.
UK tech sector performed well
Accountancy group UHY Hacker Young Fund found firms have been looking to capitalise on a buoyant UK tech sector, with M&A deals worth £8.4 billion in the 12 months to September, up from £3.3 billion on the same period last year.
Researchers said the hike in deal value was driven by private equity and international conglomerates snapping up AIM listed tech firms which had performed strongly through the pandemic.
The total value of tech M&A deals on AIM this year rose to £2.6 billion, making up nearly a third of the total value of all M&A deals on AIM.
Tech acquisitions on AIM accounted for just 7% of deals (£232 million) in the previous year, researchers added.
The rise was led by the £919 million takeover of video game developer Sumo Group, creator of the video game series Little Big Planet and Sonic Racing, by Chinese technology conglomerate Tencent.
The acquisition of the Sheffield-based firm, which has offices in the US, has come under the scrutiny from a US national security panel last week.
However, Reuters reported that Sumo and Tencent are engaging with the Committee on Foreign Investment in the United States to get clearance for the deal before the end of the year.
Platform for growth
The acquisition of business communications software provider IMImobile by American technology conglomerate CISCO was the second most valuable acquisition for an AIM listed technology firm at £540 million.
Dan Hutson, partner at UHY Hacker Young, said the AIM was putting the success of UK tech firms “in the shop window”.
He said: “Being AIM listed is an excellent platform for growth companies, helping them to raise capital and to move to the next stage of their growth through M&A.
“Both private equity and major tech multinationals are watching AIM to identify acquisition targets.”
Deals in AIM listed health firms topped £835 million while mining deals came in at £305 million.
Augean sale history
The bidding action for Augean started in May when Morgan Stanley Infrastructure Partner (MSIP) made an offer worth around £300m for Augean.
Eleia – a special purpose vehicle formed by investment funds managed by Ancala Partners and Fiera Infrastructure of Canada – entered the race with a £341m offer in August.
In September Morgan Stanley put forward an improved offer of £356m.
But with neither suitor declaring their bid final, the auction process was announced.
Augean brought the first major decommissioning project to Tayside.
It worked on the Shell Curlew dismantling project at Port of Dundee for more than a year.
The company cut more than one-third of its North Sea services workforce last year.