Figures from the Centre for Management Buy-out Research (CMBOR) found that the value of private equity deals in the UK for the six months to June 2009 was £3.2 billion, down from £12.5 billion in the same period last year and the lowest half yearly figure since 1995. A separate study found that private equity houses saw their steepest decline on record, with portfolio returns falling by 27.6 per cent in 2008 in the wake of the credit crisis.

Contrary to these figures, Cobbetts has seen a flurry of activity, advising the management team of Ansa Holdings and Independent Inspections Holdings in its private equity-backed MBO from listed parent company, Mavinwood plc, and advising private equity house, Key Capital Partners (KCP), in its backing of the MBO of TSC Foods Limited (TSC). Most recently, the firm advised mid-market private equity firm, Gresham Private Equity, on the management buyout of five businesses from Formation Group plc, including James Grant, the talent management specialist. Prior to this, Cobbetts advised the management team at mooring solutions specialist, Viking Moorings, in a deal which saw HSBC Private Equity acquire the business from Inflexion Private Equity.

The four deals, which were agreed between 30 June and 30 July, had a cumulative value of £243m.

Sean Fitzgerald, corporate partner at Cobbetts LLP, said: “While private equity deals have been in decline, our experiences suggest that funding is available for quality businesses with strong balance sheets and steady growth. Irrespective of the recession, private equity houses have not closed their doors. They are, however, becoming increasingly selective to ensure banks will leverage deals.

“We’re seeing more and more bank debt creeping back into mid-market deals, which is supporting a steady flow of activity in the UK. While this is likely to increase to more ‘normal’ levels over the next six to 12 months, the mega deals of two years ago, based on five or six parts debt, appear to be long gone.”