Construction

PEM Corporate Finance has extensive experience of advising businesses which operate in the UK construction sector. Please get in touch for an informal and confidential chat about your plans.

Let us help build your strategic plans

The sector includes all residential and commercial building, civil engineering and specialist activities such as electrical installation and plumbing. In this definition, we also include other suppliers to construction projects such as architects, window manufacturers, horticulture and crane suppliers. PEM Corporate Finance has the breadth of experience across the value chain to advise any construction business.

There are 343,000 VAT-registered construction businesses in the UK and approximately 36% of the 2.4 million jobs are self-employed contractors working on specific projects. The construction sector’s contribution to UK GDP is 6% or £117 billion (2019).

Transaction trends

For transactions valued at less than £100m in the UK construction sector, there has been a c.9% increase in deal volume and a c.50% increase in deal value. In 2022, the total deal value grew from c.£308m to c.£462m, whilst deal volume rose from 81 to 88.

Within the UK construction M&A market there is an increasing focus on sustainability and green initiatives. Many construction companies are seeking to align themselves with the UK government’s net-zero targets and are therefore looking to acquire businesses in the renewable energy and sustainable infrastructure sectors.

Additionally there is increasing involvement of private equity firms, who have been attracted to the construction industry due to its long-term contracts and strong growth potential. Private equity firms have been involved in a number of high-profile deals in the UK construction industry in recent years, including KKR’s acquisition of John Laing Group in 2020.

Our construction sector experience

We have advised a wide range of construction businesses on M&A, buyouts and valuation since 2004. Recent transaction highlights include: The MBO of COEL, the sale of English Architectural Glazing, and the sale of ATP Architects + Surveyors

Below is a showcase of the construction transactions we have advised:

Construction - M&A Outlook

Carrying forward the momentum of the 2022 revival, business owners within the construction sector could see EBITDA multiples exceeding c.11.5x from eager buyers in 2023.

Download our 2023 outlook on M&A within the construction sector here.

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