BUSINESS WITHOUT BORDERS: International growth at mid-cap companies

01 April 2015

International expansion a major strategy driver for mid-market firms


London: International growth is seen as a key part of company strategy by 56% of mid-cap firms surveyed for a new report by Mergermarket and Mazars. Half of those polled also plan to make an acquisition in the next three years.


“Mid-cap companies worldwide experienced a strong end to 2014. As the world becomes increasingly global, most are looking at ways of driving growth through expansion into new international markets”, said Laurent Inard, Partner at Mazars.


As well as a general appetite for international expansion, the report reveals that mid-market firms see Asia as a particularly attractive market for growth, with respondents in EMEA, the Americas and Asia all most likely to cite countries in this region as ones where they are most likely to build new operations. India and Australia were singled out as hotspots for future investment by the highest proportion of respondents. The report also suggests that expansion into Asia is likely to bring challenges, with respondents from all three regions also most likely to cite an Asian country as their most difficult existing market.


In terms of financing international growth, 58% of mid-market firms surveyed are likely to use bank debt to fund overseas expansion, with 56% looking to internal profits and 31% to investment from private equity or venture capital.


Kate Jenkinson, Editor at Mergermarket, added: “It is interesting to note that the majority of respondents are looking to banks to finance their international growth plans – signifying a return to confidence in bank financing following the trend in favour of alternative lenders we saw post-financial crisis.”


For the report, Mergermarket canvassed the opinions of 150 senior corporate decision makers (CEO, COO, CFO or Head of Strategy) at mid-market companies, defined for this study as companies with revenues between €250m and €2.5b. Geographically, the respondents were split 50 each from EMEA, North America and Asia-Pacific, and also evenly (50 each) for companies with revenues between €250-500m, €500-€1.5bn and €1.5bn-€2.5bn.

To view the full report, please click here.