- Approach for Just Group is the tenth in the UK stock market with a value of more than £1 billion in 2025
- It takes the total value of concluded or live bids to almost £25 billion
- Such returns add to an estimated £91 billion dividend haul and £54 billion in already-declared share buybacks
- The total cash return to investors from the UK market for 2025 is currently running at £170 billion, or 6.6% of the FTSE All-Share’s £2.5 trillion valuation
“There is an old saying that bull markets only end when the money runs out, but right now the UK stock market is showering investors in cash, so the still seemingly unloved headline indices could yet continue to keep confounding the doubters,” says AJ Bell investment director Russ Mould.
“The FTSE 100 stands above 9,000 for the first time, the FTSE 350 above 5,000 and the FTSE All-Share is making a bold bid to cross 5,000 for the first time as well, all helped by healthy dividends, share buybacks and also takeover activity.
“Those deals are interesting for two reasons.
“First, they suggest that someone, somewhere still thinks that UK stocks are cheap, given the average takeover premium of 38% offered so far in 2025 on 45 bids that have either closed or are still live. Wednesday’s bid for Empresaria from Legacy and Thursday’s approach for Just Group from BWS both came at levels way above the prevailing share price.
Source: Company accounts
“Second, merger and acquisition activity puts cash back in investors’ pockets and they can redeploy that cash by buying something else. Not every offer from a predator is cash only – the approaches for Assura, Bakkavor, Urban Logistics REIT, Marlow and Dowlais all have some element of payment in stock to them – but pretty much all come with cash on the table to some degree and that cash may well look for a new home once the deals conclude.
“Thursday’s bid for Just Group is the tenth in 2025 to date that comes with a price tag in excess of £1 billion.
Source: Company accounts
“The Just deal takes the total in closed or live bids to just shy of £25 billion so far this year, to follow on from the tallies of £49 billion and £17 billion for 2024 and 2023, respectively.
“The running total of nearly £25 billion for 2025 equates to 1% of the FTSE All-Share’s £2.5 trillion market capitalisation. Add the consensus analysts’ forecast of £91.3 billion in dividend payments from the index’s members and the £54 billion in share buybacks already declared by them this year and the total cash return to investors is estimated to be £170 billion.
Source: Company accounts, Marketscreener, consensus analysts’ forecasts, LSEG Refinitiv data
“That is 6.6% of the FTSE All-Share’s market cap. Such a total cash yield may look tempting to many investors, as it handily beats the prevailing rate of inflation, the Bank of England base rate and the benchmark UK 10-year gilt yield.
“The cash inflow is therefore the total opposite of the cash drain that tends to call the top in markets, when investors are seduced by a rash of initial public offerings and new floats and then besieged by second offerings of that same paper.”
