MHA Moore and Smalley predicts record number of deals to start 2021

By Tim Aldred

01 Dec 2020

MHA Moore and Smalley is predicting a record number of deals taking place in the first quarter of 2021 after advising on more than £200m of activity in the ten months to October.

Andrew Feeke, the Preston-based firm's head of corporate finance believes that the widely anticipated changes to the capital gains tax regime next year, together with strong liquidity among funders, could lead to a record volume of deals between January 1 and April 5.

He predicts that even after some of the government loan schemes end, there will still be good levels of deal finance available as alternative funders look to continue their growth and enhance their client base. In the near term, there will remain strong appetite from private equity funders for well-managed businesses in the tech and healthcare sectors.

Chancellor Rishi Sunak asked the Office for Tax Simplification (OTS), an independent arm of the Treasury, to identify opportunities to simplify capital gains tax in relation to individuals and small businesses. 

Higher rate taxpayers currently pay a rate of 28% on gains on property and 20% on gains from other chargeable assets like shares. Basic rate taxpayers pay 18% on gains on property and 10% on other assets. A reduced rate of capital gains tax of 10%, formerly known as Entrepreneurs Relief (now Business Asset Disposal Relief), also applies to individuals selling all or part of a business, providing certain criteria are met.

The OTS published a report in November in which it recommended bringing capital gains tax rates more in line with income tax rates and a reduction in the annual tax allowance. With this as a backdrop, it is thought the chancellor could implement some changes to the tax rates as part of his next budget.

Andrew said: "Our deal activity has remained strong throughout the pandemic period with our team kept busy on deals spanning different sectors, including cross border deals. Many of the legal advisors and private equity contacts I speak to are witnessing a recent increase in activity levels.

"Our short-term pipeline of deals remains incredibly strong and a key driver of this is the possible increase in capital gains tax rates, likely to be introduced from April next year. We’re looking at a lot of MBO activity and Employer Ownership Trust transactions as owners, particularly those with cash on the balance sheet, look to accelerate transactions to realise value from the business before any potential changes come in.

"There is obviously uncertainty over capital gains tax after April which will probably weight the majority of next year’s deal activity in quarter one. However, I’m confident that even if we see a dip in activity for a few months, it will stabilise in the second half of next year and we’ll still see a similar amount of deal activity overall."

Andrew also warned: "On a more concerning note, I suspect there will also be an increase in business turnaround transactions when some of the pandemic support, such as Time to Pay arrangements come to an end and we may well see a number of pre-pack deals going through. The timing of the return of ‘Crown Preference’ could not be better from a HMRC perspective, providing HMRC with more power in an insolvency process."

  • For further Lancashire business news, advice and analysis subscribe to Lancashire Business View or join the LBV Hub from just £2.50 per month. Click here to subscribe now.

Enjoyed this? Read more from Tim Aldred

Latest news

1

Roundhouse secures approval for new £15m office and industrial scheme in Preston Momentum

Roundhouse secures approval for new £15m office and industrial scheme in Preston

25 Jul 2025

2

Homebuilder's high-performing sales advisers clinch awards Ben Garland and Julia Lorente

Homebuilder's high-performing sales advisers clinch awards

24 Jul 2025

3

Work is set to start on Multiversity project Multiversity Blackpool

Work is set to start on Multiversity project

24 Jul 2025

4

BAE Systems welcomes MOU between Republic of Turkiye and UK for purchase of Typhoon aircraft Typhoon production Warton

BAE Systems welcomes MOU between Republic of Turkiye and UK for purchase of Typhoon aircraft

23 Jul 2025

5

Assystem to double UK jobs to deliver Sizewell C EDF Assystem

Assystem to double UK jobs to deliver Sizewell C

22 Jul 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
Lancashire Built Environment Conference 2025
BEC 315 X 315 Px
Networking
25 Sep 2025

Lancashire Built Environment Conference 2025

Blackpool Football Club, Blackpool, FY1 6HX

08:30 - 13:00

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

Preston Tech Connection: Buzz Word Bingo. Challenging Todays's Buzzwords In Tech
July PTC banner long updated.png.png
LBV Hub Networking
29 Jul 2025 - 29 Jul 2025

Preston Tech Connection: Buzz Word Bingo. Challenging Todays's Buzzwords In Tech

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Preston Freelancer Meet-Up: July
Longer July Banner.jpg.jpg
LBV Hub Networking
31 Jul 2025 - 31 Jul 2025

Preston Freelancer Meet-Up: July

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Advantage: AI – A Workshop for Business Leaders – August 14th
Navy--Event Tile.png.png
LBV Hub Seminars
14 Aug 2025 - 14 Aug 2025

Advantage: AI – A Workshop for Business Leaders – August 14th

Door4 Office, Burnley Wharf, Burnley, BB11 1JG

09:00 - 12:00

The Business Network Central & East Lancashire
LBV Header (24).png.png
LBV Hub Networking
21 Aug 2025 - 21 Aug 2025

The Business Network Central & East Lancashire

Mytton Fold, Langho, BB6 8AB

11:30 - 14:15

Morecambe Bay Walk
Walk.jpg.jpg
LBV Hub Awards
30 Aug 2025 - 30 Aug 2025

Morecambe Bay Walk

Arnside, CARNFORTH, LA5

09:30 - 14:00

Longridge Soap Box Derby
Screenshot 2025-06-10 090035.png.png
LBV Hub Fundraisers
14 Sep 2025 - 14 Sep 2025

Longridge Soap Box Derby

Berry Lane, Longridge, PR3 3WH

10:00 - 16:30

Cumbria Business Expo 2025
https---cdn.evbuc.com-images-880461633-4862066883-1-original.20241022-110415.jpeg.jpg
LBV Hub Exhibitions
19 Sep 2025 - 19 Sep 2025

Cumbria Business Expo 2025

Carlisle Racecourse, Carlisle, CA2 4TS

09:00 - 15:00

Help to grow management course
Help to grow - barriers to growth.png.png
LBV Hub Seminars
26 Sep 2025 - 16 Dec 2025

Help to grow management course

Preston Campus , Preston , PR1 2HE

09:00 - 15:00

RISE - Lancashire's unique leadership programme for women
thumbnail_Emma Weston Illustration WENDY BOWERS RISE Illustrstion.jpg.jpg
LBV Hub Seminars
22 Oct 2025 - 18 Mar 2026

RISE - Lancashire's unique leadership programme for women

East Lancashire Chamber of Commerce, Clayton le Moors, BB5 5JR

09:30 - 15:30

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV 123 Online Graphic
Subscribe now

Weekly news bulletin