Southampton: SMEs doing deals with corporates, says Bond Dickinson

Economic data released today by law firm Bond Dickinson has revealed that 707 deals took place between South East SMEs and large organisations over the past four years, known to have exceeded £13.7 billion.

With 13% of all the deals between large organisations and UK SMEs carried out in the South East, the region came second only to London in terms of both the volume and value of deals. The data showed that 707 SMEs in the South East took part in these deals compared with 2,450 in London.

Taking into account the number of SMEs in each region, the South East ranks as fourth out of 12 UK regions in terms of levels of collaborations between SMEs and corporates.

Manufacturing, technology and financial services firms top the table of South East SMEs collaborating with large organisations.

Across all regions, between 2013/14 and 2016/17, large organisations are known to have invested over £102b in 5,447 deals with UK SMEs. This exceeds the £62b corporates invested in UK research and development between 2013 and 2016, and represents more than a seventh of the £683b total UK business investment.

Based on analysis of four tax years of deal data, the findings are detailed in Close Encounters: The power of collaborative innovation. The report explores deals between large organisations and UK SMEs, including mergers and acquisitions, minority stake purchases and joint ventures from April 2013 to April 2017.

Jon Hales, partner and head of Bond Dickinson's Southampton office, commented: “Matching an innovative, nimble startup with the resources of a large organisation can be a powerful combination. This type of collaboration is a popular strategy in the South East where cities like Reading, Brighton, Southampton and Oxford have become hubs for cutting edge technologies and dynamic ways of working.

“It’s no surprise to see that manufacturing and technology are top areas for collaboration in the South East because there are a number of fast-growth, high-tech companies operating here that could benefit from the reach and regulatory influence of larger corporates in rolling out their products.

“The South East has traditionally been one of Europe’s strongest regions in terms of innovation, with high levels of R&D intensity and patent applications per capita. Our data suggests this focus continues today.”