Analysts predict acquisitions activity ahead over the next year

Industry analysts are forecasting a flurry of buyout activity in the months ahead. Plimsoll Publishing has identified 130 electrical contracting companies ripe for takeover in its latest look at the top 2000 firms in the sector.

The 130 firms have been tracked over the last four financial years and have underperformed against the rest of the industry. Plimsoll suggests that there is potential to deliver outstanding returns to their current owners or potential acquirers.

David Pattison, senior analyst at Plimsoll, says: "These are all classic acquisition targets. They are currently undervalued but have great potential. Each of these companies could be turned around and have a great future. The existing owners might just be too constrained to do it." The most obvious problem for many is that they are hindered with rising debts that are eating into their profit margin.

Plimsoll also identifies over 300 potential buyers, said to be looking "fat" with cash to spend. "These companies have a cash pile beyond their normal business needs," says Pattison. "It is doing nothing sat in the bank at the moment and the prospect of a cheap acquisition must be in their thinking."

For a copy of Plimsoll's acquisition pack, which includes a complete assessment of the top 2000 UK electrical contractors, priced at £465 plus vat, call 01642 626400.