Private Equity Firms All Want the Same Thing: British Companies

Flush with capital, the funds have gone bargain hunting in Britain, snapping up everything from supermarkets to defense companies.

LONDON — It began as a market stall in West Yorkshire, selling eggs and butter just before the turn of the 20th century. Today that market stall is Morrisons, Britain’s fourth-largest supermarket chain, with nearly 500 stores and the prize in a 7 billion-pound ($9.6 billion) bidding war between American private equity groups. It is a financial drama that is playing out almost weekly in Britain: A domestic company is courted and snapped up by, most likely, private equity investors awash with cash. Global investment companies have $1.3 trillion in dry powder (industry parlance for the unallocated capital), according to PitchBook, and they are eager to pluck bargains on British shores, where company valuations have been depressed by years of Brexit uncertainty and then disrupted by the pandemic.