Share prices surge for UK resellers after Johnson's landslide general election victory
Landslide majority for the Conservative party lifts the stocks of Computacenter, Softcat and other UK resellers
Share prices for the UK's publicly listed resellers have surged overnight after the general election result delivered a historic landslide victory for Boris Johnson's Conservative government.
The Conservative Party has so far secured a comfortable majority of 364 in last night's general election, with 649 out of 650 seats so far declared. The party has added 66 seats to its 2017 total, while the Labour Party has lost 42 seats.
The pound enjoyed its biggest rally in almost three years after the Conservatives secured the majority. Sterling leaped by more than three cents against the US dollar to $1.35 - its biggest rise since 2017.
The general election result has also had a positive impact on the UK's largest publicly listed resellers.
Hatfield-based Computacenter, the country's largest reseller with £1.62bn in revenues, saw its share price spike by almost six per cent overnight, as election exit polls suggested a huge victory for Prime Minister Boris Johnson's party.
Similarly, the UK's second largest reseller - Softcat -saw its shares jump by more than five per cent overnight off the back of the general election news.
The election result has had a positive impact on other listed UK channel firms. BT, which has fended off fears of nationalisation after Labour leader Jeremy Corbyn's defeat this morning, saw its share price rocket by as much as 10 per cent to 206.8p as its shareholders celebrated the news.
Services giant Capita saw the largest increase out of the UK's publicly listed channel firms, with its shares growing by as much as 13 per cent overnight.
Brexit has mired the IT channel over the last few years, with vendors, analysts and channel bosses pointing to uncertainty around the UK's future relationship with the EU.
Channel bosses including Softcat's Graeme Watt and SCC founder Sir Peter Rigby have sounded caution about what impact Brexit might have on their businesses.
But with a comfortable majority in government, the general election result has lifted investor confidence in channel firms. A Conservative majority will likely make it easier for the government to push Boris Johnson's Brexit deal through parliament, with many believing it will help reduce uncertainty on Brexit for many business leaders.
The share price boost after the general election comes after several years of soaring valuations for resellers. Canalys' CEO Steve Brazier made valuations a central theme at this year's EMEA Channels Forum in Barcelona, claiming that reseller valuations have more than tripled in the last five years.
Similarly Kelway founder Phil Doye recently said that his firm would have sold for more than £1bn if it still existed today.
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