Thomas Scott & Co works with a range of businesses in the hospitality and leisure market in order to plan and execute business sales. With over 250 client engagements to date, we can support business owners in a variety of ways allowing them to typically realise streamlined and higher value exits.
When working in the hospitality and leisure market there are most often 2 key paths to an external exit, this can be via trade sale which can be a compelling opportunity for businesses in the same or synergistic industry. The other primary method is via a private equity buy-out or search fund which often serves for larger businesses operating in the lower middle market. To learn more about how we can assist in selling your business—from restaurant groups to asset backed leisure businesses—request a business valuation or contact Thomas Scott & Co today.
Our service is delivered to precisely match the unique needs of our clients, whether they are navigating the complexities of selling a business or planning for a long term exit. We are dedicated to delivering superior outcomes for our clients, ensuring their satisfaction and success every step of the way.
We pride ourselves on offering a quality service, tailored to exceed expectations. We believe in building relationships that stand the test of time. With each interaction, we strive not only to meet but to surpass our clients’ needs and aspirations, ensuring their journey with us is one characterised by excellence and lasting satisfaction.
We specialise in guiding clients through M&A landscape with clarity. Our team of advisors leverage their understanding of M&A to support at every stage of the process, from initial strategy development to due diligence and seamless execution, we offer tailored solutions that allow our clients to make informed decisions.
M&A Market
The UK M&A market for hospitality and leisure is currently experiencing a notable upturn, fuelled by expanding profit margins and increased investor engagement, particularly from private equity funds. In 2023, the sector saw deal values surpassing £20 billion, marking a significant resurgence in activity. Renewed interest in the sector is seen in several high-profile transactions from the latter part of the year. Examples include Apollo Capital Management acquiring The Restaurant Group, Young’s purchasing City Pub Group, and Thrive Capital taking over Ten Entertainment. These deals highlight the sector’s growing attractiveness to investors.
Key statistics underscore the sector’s revitalisation. The hospitality and leisure market is projected to grow at a CAGR of 8% over the next five years. This growth is driven by evolving consumer preferences and strategic repositioning efforts by businesses. Consumer trends such as a demand for high-quality offerings, seamless digital experiences, wellness-focused services, and strong environmental, social, and governance (ESG) commitments are reshaping the industry. Companies that align with these trends have seen profit margins increase by as much as 12% year-on-year, distinguishing them from competitors struggling to adapt.
The M&A landscape within this sector is diverse, with smaller enterprises demonstrating potential for growth, scalable franchise models, and opportunities for overseas expansion attracting significant interest. These businesses offer attractive returns on investment, drawing a wide range of acquirers, including institutional investors, industry-specific buyers, international acquirers, operational investment groups, and strategic buyers. Private equity-backed firms were particularly active, accounting for over 30% of the deal volume in 2023, a clear indication of their confidence in the sector’s long-term prospects.
Looking ahead, the momentum for M&A activity in the UK’s hospitality and leisure sector is expected to remain strong throughout 2024. Industry experts predict a further 15% increase in deal volume, driven by factors such as debt refinancing needs, strategic consolidations, the pursuit of private equity returns, and the impact of significant previous investments, like Apollo’s entry into the market. Despite economic pressures such as inflation and rising capital costs, the sector’s resilience and adaptability position it for continued growth and dynamic M&A activity.
Our view on the current key statistics for M&A in hospitality & leisure
Last Updated: 30/11/2024
Thomas Scott & Co has experience valuing businesses across a wide range of markets, employing various methodologies to ensure accurate and reliable assessments.
Our approach in construction and industrials often begins with market-based multiples to establish an initial valuation range. We then typically refine this with more technical methods, such as Discounted Cash Flow (DCF) analysis or other market-appropriate techniques. Our commitment is to adopt a real-world and measured approach, providing valuations that are transparent and reflective of realistic outcomes in current market conditions.
To enhance valuation outcomes, we focus on identifying the strategies to maximise value. This may involve introducing competitive dynamics or targeting potential acquirers based on geographic alignment or anticipated synergies. This strategic approach enables us to deliver accurate valuations and quickly assess the demand for an acquisition.
For all businesses, we offer the opportunity to get a indicative valuation without cost.
We are an independent M&A advisory firm with operations in 3 continents utilising our headquarters in London, satellite office in Paris and partnership in New York. We specialise in selling businesses valued up to £500m, across 9 key markets typically exiting to trade or institutional buyers. As we are an independent firm, free from constraints, we pride ourselves on our ability to take a long term view on exits and work with clients to model their optimal journey.
Group Directors
We are an independent M&A advisory firm with operations in 3 continents utilising our headquarters in London, satellite office in Paris and partnership in New York.
We specialise in selling businesses valued up to £500m, across 9 key markets typically exiting to trade or institutional buyers. As we are an independent firm, free from constraints, we pride ourselves on our ability to take a long term view on exits and work with clients to model their optimal journey.
Group Directors
We provide market leading sell side M&A advisory services to clients located across the United Kingdom.
We help businesses to raise private capital at venture or growth stage.
We work with clients to structure a long term exit, typically via a succession plan for the owners.
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