Off the radar for many deal-makers, the South West boasts M&A stats that buck stuttering national trends. Rachel Willcox investigates what makes the region tick and whether its strong growth can be maintained.
The South West may conjure up idyllic scenes of dramatic coastlines, iconic landmarks, cream teas and pasties – but it’s the region’s vibrant deal-making environment, supported by a thriving corporate finance ecosystem, that is fast putting it on the business map.
As one of only two regions in the UK (the other being the Midlands) to see a bump in PE deal volumes in 2025, the South West is holding its own against a national backdrop of waning market and investor confidence and a market plagued by geopolitical and economic uncertainty.
KPMG’s most recent UK Private Equity Review found that 127 transactions were completed in the region last year, a marginal rise of 4% year-on-year. And the region accounted for 7% of the total PE-backed deals in the UK (6% in 2024). Bolt-ons remained the most common deal type, with 83 completed, as investors looked to build scale in their existing platforms. Private equity exits were slightly up year-on-year (18 versus 17), according to KPMG figures.
Play to your strengths
Big-ticket regional deals such as the £5.4bn takeover of Bristol-based Hargreaves Lansdown in March 2025 by a PE consortium of CVC and Nordic Capital alongside sovereign wealth fund ADIA are the exception rather than the rule. The mid-market profile of many deals – typically £10m-£150m depending on who you speak to – dominates the landscape.
That has prompted some of the bigger firms, including Deloitte and PwC, to scale back their regional deal advisory offering. But for others, the combination of a stable market and strong potential in growth industries is making the South West a target for expansion.
Tim Spooner is a partner in the Bristol office at FRP Corporate Finance. He often works hand in hand with the corporate finance team in Cardiff. “Last year was a busy year for local private equity houses divesting, but they’ve all got money to spend and they’re keen to deploy it for the right opportunities,” says Spooner.
The Gloucester/Cardiff/Bristol ‘cyber triangle’ is thriving, largely thanks to its proximity to UK intelligence agency GCHQ in Cheltenham. Investment across tech and tech-enabled business services is growing and there’s been an uptick in cyber resilience deals, buoyed by the prevalence of incubators, accelerator hubs, and bank-backed initiatives to help small businesses grow (see ‘Tech trailblazers’ box).
Mark Shepherd, partner in the corporate and M&A team at Burges Salmon, believes deals from legacy industry spin-outs have also gained traction. “We’re seeing spin-outs from Bristol’s aerospace industry,” he says. “We’re also seeing people leaving public sector defence and security organisations to pursue business opportunities in the defence world.”
The law firm’s main hub is in Bristol, although it has smaller hubs in London and Edinburgh. “For a chunk of deals, especially at the larger end of the spectrum, the capital is coming out of London, so we have to be on the ground in London,” says Shepherd, “but we’ve very much taken the decision that’s not where we want to be headquartered.”
No shortage of skills
High-calibre graduates from the universities in the region ensure a strong pipeline of talent for advisory firms in the area. And a distinct shift in the priorities of today’s recruits is playing into the hands of regional players. It means that the kinds of people attracted to the South West firms are no different from those forging a path in London.
Burges Salmon’s Mark Shepherd (pictured) says that while Bristol salaries can’t compete with London’s, the total package of location, culture, flexibility, and access to interesting deals is proving a compelling proposition to prospective recruits. “You have to give people rewarding, exciting work to do, and the environment’s got to be right. Do that and you can punch above your weight when it comes to attracting talent.”
Proximity to beautiful beaches and historic landmarks can be a powerful weapon in a recruiter’s armoury. “It’s not necessarily a mindset thing or a quality-of-work thing – maybe it’s more of a lifestyle choice,” says FRP Corporate Finance’s Tim Spooner.
Good energy
As the race to decarbonise accelerates, interest in companies providing services in that area is flourishing. At Langage Energy Park – a 50-acre development near Plymouth that will incorporate a green hydrogen power plant capable of heating 14,000 homes – only certain businesses are allowed. Technologies that move the economy towards net zero are one of the permitted sub-sectors (alongside advanced manufacturing and engineering, marine, defence and space). This should provide the encouragement for innovative businesses to invest in the region.
Hg Capital-backed international advisory group Azets, which has been growing its UK presence, identified Plymouth as a location with significant growth potential four years ago. Originally set up with two partners, the Azets Plymouth office now has around 40 employees. Its Bristol office was set up two years’ ago and it also has offices in South Molton and Truro.
From a client perspective, the cost benefits of “non-London [advisory] rates” are a bonus, says Katherine Broadhurst, a Cardiff-based corporate finance partner at Azets who covers the South West and Wales, “but more broadly, you want people to have that network. I’m firmly rooted in my region because I grew up in Plymouth in a Cornish family. I know the places, businesses and culture that I’m talking about. I’ve got that local knowledge, and I can also reach into London if I need it.”
The largely rural nature of Devon and Cornwall means many may not see the area as strategically significant for M&A. And yet, as Broadhurst points out, the counties play host to many high-quality manufacturing businesses, many of which service specialist and/or local markets due to the logistical challenges of the location.
Our focus is on building long-term relationships until the timing for a deal is right
Know your customer
Having boots on the ground locally is a definite benefit, particularly given the large geographic area covered by the South West region. “Our focus is on building long-term relationships with potential clients until the timing for a deal is right,” says Spooner. “Proximity to clients is a definite advantage in the region. Very few advisers in London are going to want to drive for six hours to see a client in Cornwall once, let alone frequently.”
The support of sector-relevant and situational expertise from FRP’s network of a dozen corporate finance offices and more than 100 advisers nationwide gives the regional proposition real strength. “We’ve got local presence, national reach, and an international network to play on as well,” adds Spooner. “I think that’s a compelling blend and a real differentiator for us.”
“Just having boots on the ground is less effective on its own,” says Nick Jones, a partner in Grant Thornton’s Bristol office. “Where you win is when you combine presence in the region with genuine and deep sector expertise, international presence and reach, and a full service offering to help clients through every aspect of a transaction.”
Grant Thornton has a team of 20 in Bristol – 10 in M&A advisory and 10 in due diligence – with further expansion in the pipeline. “It’s a market we’re very focused on. We see the South West as a massive opportunity,” Jones says. Recent deals conducted out of the Bristol office include December’s LDC-backed MBO of Exeter-based Taking Care, a provider of technology-enabled care products and services from AXA Health at the end of last year.
Phil Duma, deal advisory partner for BDO in Bristol, joined the firm with a remit to expand its focus on the region. “As an office, we’re passionate about supporting businesses in the region and fuelling the regional economy. And we have the expertise here – not everything has to go to London,” he says.
Tech trailblazers
The innovation ecosystem in the South West is thriving, fuelled by several universities – notably Bristol (pictured, bottom), Bath (pictured, top), Exeter, Plymouth and UWE Bristol – coupled with a growing accelerator and incubator network. Innovation hubs and growth networks such as the Bristol and Bath Science Park, techSPARK (also in Bristol and Bath) and SETsquared centres in Exeter, Bristol and Bath are breeding grounds for tech-related talent and innovation.
Nick Jones at Grant Thornton (pictured) says that in the 10 years he’s been based in Bristol, a host of specialist incubators and accelerators, in areas such as deep tech and quantum technology innovation, have become more established in the region.
But turning innovative ideas into spin-out opportunities remains a work-in-progress, says Azets’ Katherine Broadhurst. “I think even more could be done to ensure those opportunities are encouraged and captured for the longer-term benefit of the region, rather than it just being seen as a beautiful place to live and work.”
Bristol and beyond
In addition to the London-based PE firms that are actively involved in the region, LDC, BGF and Maven have regional teams operating out of Bristol, while Mercia and Science Creates Ventures provide early-stage funding. In 2024, Foresight Group launched its South West Fund with a cornerstone investment from Devon Pension Fund; a £50m investment from Avon Pension Fund in March 2025 enabled the fund to achieve a second close at £100m.
When it comes to legal advice, there are plenty of offices with M&A expertise operating in the region, including Burges Salmon, TLT, and Osborne Clarke. The latter was first established as a Bristol law firm in 1748, although it has now moved its headquarters to London.
But Spooner believes one legacy of the pandemic is a less London-centric view of the world. And although Bristol is a significant hub, there are pockets of activity all over the region, particularly in major towns such as Gloucester and Exeter. “Lots of people will have cut their teeth in London and many corporate financiers will have trained with the Big Four,” he says. “Whether the firm is in Bristol, Cardiff or London, having local relationships almost trumps all. But there’s plenty of high-quality expertise in the region.”
We’re all pulling in the same direction in terms of growth of the region
The West Country way
Debates about office locations aside, business culture in the South West is quite different, in part due to the size of the corporate finance community. A tight-knit corporate finance community with a collective objective for success underpins the region’s hunger for growth. “There are good deals to be had, and every deal has at least two advisers. What we want is for the deals to happen. We’re all pulling in the same direction in terms of growth of the region,” says Broadhurst.
“We’re in competition with each other, but it’s friendly competition,” Shepherd explains. “Doing jobs with people who you enjoy working with and who you know on both a professional and social level helps smooth deals through as much as anything else.”
“There’s also a cultural point of people being proud to be a part of the South West community, particularly within Bristol,” says Grant Thornton’s Jones. “When people are referring work, they like to keep it within that community.”
Success hinges on demonstrating that you’re genuinely invested in the region and that it’s not just a token gesture, he cautions: “That takes time. A lot of the relationships that I value are ones I started building 10 or 15 years ago and have been nurturing ever since. You can’t expect any of this to happen overnight.”
