Close encounters can give Scottish firms ‘the edge’

A study of transactions demonstrating collaboration between Scottish SMEs and large organisations over the last four years revealed 347 deals exceeding £4billion, new data has revealed.

Insurance and manufacturing SMEs top the table of companies engaging in these deals, according to law firm Bond Dickinson, which collected the data.

Taking into account the number of SMEs in each area of the UK in 2016/17, Scotland was the third most popular place in the UK for corporates to invest in SMEs – behind London and the north-east of England.

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.

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

Michael Spence, partner and head of Bond Dickinson's Aberdeen office, said: “With so much uncertainty in the world, now is the time for Scottish businesses to find an edge through innovation. When SMEs and corporates team up they can accelerate progress for both sides.

“Fortune favours the brave and it’s great to see so many Scottish SMEs attracting investment from large companies at home and abroad.”

Michael Spence