Business News Round Up (28/06/2022)

UK at ‘significant risk’ of heading into recession

The UK is at “significant risk” of heading into a recession, due to the mounting cost-of-living crisis and the Ukraine conflict. The latest UK economic outlook from KPMG predicts that growth will more than halve to 3.2% this year from 7.4% in 2021, before falling to 0.7% in 2023. Global growth is being hampered by the ongoing Ukraine war and lockdowns in China, which have affected commodity prices and restricted supply, while in the UK, the knock-on effect on prices is set to see a sharp drop in household and business spending. Yael Selfin, chief economist at KPMG UK, said that “weakening domestic momentum” could put the UK at “significant risk of a mild recession”. She explained: “We expect growing external headwinds and weakening domestic momentum to see economic growth slow significantly over the next year, with a significant risk of a mild recession.” In its “downside scenario”, KPMG predicts that the UK would see a recession – as defined by gross domestic product (GDP) falling in two or more successive quarters – with output dropping by 1.5% in the year between 2022 quarter three and 2023 quarter three. It said in this scenario, UK output would fall by 1.1% in 2023, following 3% growth in 2022.

https://www.insider.co.uk/news/uk-significant-risk-heading-recession-27337546

BGF’s North West team leads on deals with an EV of £450m

Growth capital investor BGF has led on deals with a total enterprise value of £450m in the North West in six months. In the same period, BGF’s North West team has achieved a stand-out run of exits which has seen £150m of capital returned from £72m invested.  Highlights include the sale of Liverpool-based Sentric to Swiss music fintech company, Utopia Music, PTSG’s acquisition of NSS, and CurrentBody’s sale to eComplete. This is in addition to the outstanding exit of Kids Planet, having accelerated the nursery group’s rollout from 17 to more than 80 sites during its investment period. BGF also retained minority stakes in Kids Planet and Utopia Music as it continues as a long-term partner to both companies. The firm completed a total £42m of investment in growing businesses based in the North West in six months. These entrepreneur-led companies span several sectors including tech, manufacturing, professional services, healthcare, and training, and are based across all corners of the region. The North West team backed apprenticeship training provider, Apprentify, with a £5m investment to execute an ambitious buy and build strategy in the apprenticeship and adult education market. Wigan-headquartered manufacturer, Evolution Aqua, received a £12m BGF investment to capitalise on growth opportunities in core markets and drive international expansion. 

https://www.insidermedia.com/news/north-west/bgfs-north-west-team-leads-on-deals-with-an-ev-of-450m

Report shows progress in boosting investment in UK’s women entrepreneurs

A new report published today (Tuesday 28 June) reveals the strength of investment in the UK’s women entrepreneurs by lenders and investors signed up to the Investing in Women Code, a world-leading commitment to improve access to finance for women-led businesses. The Investing in Women Code is an initiative recommended by the government-commissioned Rose Review, led by NatWest CEO Alison Rose, into how best to boost female entrepreneurship. The code sets out commitments to support the advancement of women entrepreneurs in the United Kingdom by improving their access to the tools, resources, and finance they need to achieve their goals. Signatories to the code include Angel investment groups, venture and growth investors and High Street banks including Barclays, NatWest, and Santander. The report is the second-ever annual report on the code and key findings include: in 2021, 34% of venture capital deals made by code signatories were in companies with at least one female founder, compared to an industry average of 24%; in 2021, the average amount of Angel (early-stage) investment being sought by all-female teams (£791k) was very similar to all-male teams (£823k). This is a significant and encouraging change from 2020, when all-female teams requested less than 50% of the amounts requested by male-only teams; the number of code signatories has now reached 160, with a notable increase in the number of venture and growth capital firms joining, accounting for 34 of the 53 new signatories in the year to 31 March 2022.

Scottish port operator to invest £17m in new cranes

The operator of Greenock Ocean Terminal is placing a £17m order for two cranes. Peel Ports said the tender would help to “future-proof” the freight port as it prepares to accommodate increased demand from cargo owners. It will be the largest single investment made at the container terminal since it opened in 1969. Peel Ports said it would also help give shipping companies “reliable access” to major import and export centres in the UK. The commission of the cranes at Scotland’s deepest container terminal comes amid the ongoing construction of a purpose-built multi-agency border control post. Peel Ports said the post was required to allow all commodities to be imported and exported in the face of changing legislative requirements due to Brexit. The terminal currently accounts for 60,000 containers per year – a third of all containers coming into Scotland. Once the contract is awarded, it is expected the work will take 18 months.

https://www.bbc.co.uk/news/uk-scotland-scotland-business-61923848