KKR raises bid for Spectris to £4.2 billion, winning board support over Advent

Private equity giant KKR has increased its bid for British scientific instruments maker Spectris to approximately £4.2 billion ($5.58 billion), intensifying a takeover battle with rival Advent International.

The revised offer, which values Spectris shares at £41.75 each including a 28 pence interim dividend for fiscal 2025, is 1.8% higher than Advent’s most recent proposal.

Spectris’ board said Tuesday it had unanimously withdrawn its recommendation for the Advent offer and endorsed KKR’s new bid.

The London-listed firm’s shares rose as much as 2.1% to a record 4,168 pence following the announcement.

The latest move marks the culmination of a month-long contest between the two US private equity houses after Spectris initially agreed to an earlier Advent offer in June.

Advent had originally pitched £37.63 per share, later increasing it to £41.00 in response to pressure from investors and the competing KKR bid.

UK valuations continue to attract overseas interest

The takeover contest comes amid a surge of foreign interest in UK-listed companies, drawn by comparatively low valuations and macroeconomic stability.

The bid for Spectris follows a string of similar deals in recent months as private equity firms seek to capitalise on what many see as underappreciated British assets.

KKR’s updated offer gives Spectris an enterprise value of £4.8 billion, including debt.

The premium bid signals confidence in the long-term value of Spectris' precision measurement technologies and global operations.

Daniel Black, Vice President of Business Development at Ideals, said the rising tide of bids for UK firms reflects a broader trend.

“The recent wave of US bids for UK-listed companies reflects a broader shift in the M&A landscape, where strategic acquirers are targeting differentiated IP, AI capabilities, and advanced compute technologies.

London’s listing challenge grows amid deal wave

Should the deal proceed, Spectris would join a growing list of UK firms departing the London Stock Exchange in favour of private ownership, often due to more compelling valuations from US buyers.

The first seven months of the year have already seen global M&A transactions worth $2.6 trillion, according to Dealogic, the highest since the post-COVID dealmaking boom of 2021.

Charles Hall, head of research at Peel Hunt, warned of broader implications for the UK capital market.

“Companies in the UK seem to be far more attractive to acquirors than investors. The root cause is the consistent outflow of capital from domestic markets.

“If we want the UK equity market to thrive, an urgent rethink is required to ensure that UK capital backs UK companies.”

With KKR now in pole position, attention will turn to whether Advent will return with a counterbid or walk away from the contest.

Shareholders are expected to vote on the proposed deal in the coming weeks.