Busy year in dealmaking for Pinsent Masons’ Scottish corporate team
Pinsent Masons’ Scottish corporate team looks back on 2022, having advised on deals worth billions of pounds in various sectors, and discusses its outlook for the year ahead.
The stand-out deal in the last 12 months was Ithaca Energy’s £2.5 billion listing on the main London Stock Exchange in November – the largest UK IPO in 2022 – which was led by the firm’s Glasgow-based global head of oil and gas, Rosalie Chadwick.
Other noteworthy deals that Pinsent Mason advised on included Springfield Properties’ £46 million acquisition of the housebuilding business of Mactaggart & Mickel Group, and the sale of 80 per cent stock of Glengarnock-based steelworks fabricator J&D Pierce to Swedish group Storskogen.
In the commercial property space, property partner Paul Connolly was at the centre of the largest single office transaction of 2022, advising long term client HFD Group on the disposal of 177 Bothwell Street in Glasgow to Spanish investment group Pontegadea in a deal estimated to be worth £215m.
Also in 2022, Pinsent Masons client Scottish Equity Partners made the first investment from its new fund (Fund VI), taking a significant minority share in drug discovery and design software specialist Cresset, while elsewhere in the tech space the firm continued to act for cloud computing firm iomart and software specialist Idox on their strategic M&A programmes.
Barry McCaig, partner and head of corporate in Scotland at Pinsent Masons, said: “As a firm, in 2022 we experienced one of our business periods transaction-wise for many years with our corporate teams in Glasgow, Edinburgh and Aberdeen, advising on deals worth billions of pounds in the oil and gas, renewables, housebuilding, industrial, commercial property, fintech and technology sectors, and there were many Scottish success stories to celebrate.
“Despite the political and economic turmoil that businesses of all shapes and sizes had to navigate in 2022, it was encouraging that deals continued to get over the line. That should continue into the new year and there appears to be a good pipeline of transactions scheduled for Q1 despite continuing market uncertainty and unease about interest rates.
“Although we’ve seen a bit of contraction in the debt markets, there is still a lot of liquidity in the market and money is available for the right deals but there may need to be some readjustment of sell-side expectations, with more focus on the reconfiguration of deals, and greater emphasis on earn-outs and innovative consideration structures.”
Citing the Ithaca Energy listing as an excellent example of a “buy-and-build” strategy involving well-considered transformational acquisitions to position Ithaca as one of the leading operators in the North Sea, Mr McCaig said the IPO highlighted that institutional investors are coming back into oil and gas and that the capital markets are selectively open for quality businesses.
He added: “The oil price may cool a little in 2023 but it will stay comparatively high compared to what we have experienced in the last five years, which will encourage deal activity.
“There also remains a good appetite to invest in oil and gas with a broader range of funds coming back into the fold because of three factors - the importance of establishing energy security; the industry appears to be addressing ESG concerns; and the potential returns were much more positive last year compared to many other sectors.”
In renewable energy, the firm acted for several successful bidders on the ScotWind offshore leasing round and are now engaged on long term mandates on the consenting, procurement and build out of these nationally significant projects, while Pinsent Masons also advised Buccleuch Estates on the sale of the Glenmuckloch pumped storage hydro scheme to an infrastructure investor –ƒƒ this will be the first new-build pumped hydro scheme in 30 years in the UK.