Britain's leading companies are less adventurous than their US and continental European counterparts when it comes to making foreign acquisitions - and they are becoming even shyer, ac-cording to research by KPMG, the accountancy group.

The study of acquisition trends from 2000 to 2005 shows that continental European companies are five times more active than those in the UK in the so-called Bric economies - the big and fast growing markets of Brazil, Russia, India and China. Continental European companies are also more open to acquiring companies in the "emerging markets" of east and central Europe.

As a result, British companies are in danger of irretrievably sacrificing growth potential to European competitors and depriving shareholders of growth opportunities, the study says.

"Meanwhile the UK's top companies appear to be stuck in the rut of looking for acquisition targets in mature, low-risk, low-growth markets like the US and western Europe." The analysis also shows UK appetite for exposure to emerging markets is shrinking as that of continental Europe grows.

Corporate UK appears to see the Bric economies as risky markets, prone to economic instability and political upheaval. As a result, companies may fail to take advantage of an emerging middle class of spenders and savers in these countries.

One explanation for the weak showing appears to be that the types of companies investing most heavily in the Bric countries - typically manufacturing companies in France, Germany and the US - are not well represented in the UK.

But Simon Collins, head of corporate finance for KPMG, said that explanation was losing its force. "The US is quite service-led and there have been a lot of acquisitions by US services companies, particularly in China and India." He said the idea that these economies were drawing a lot of skittish capital was outdated. "It's evident now that there is some very well researched corporate investment going into emerging markets."

The study has tracked 9,808 acquisitions around the world since 2000 with a deal value of $4,230bn (£2,369bn). British companies were on average twice as active as their US counterparts and 40 per cent more active than continental European companies in terms of the numbers of acquisitions.

But the figures show corporate Britain "suffers from 'own back yard' syndrome, overwhelmingly preferring familiar and well-tried regions". Seventy-nine per cent of acquisitions by UK companies were in western Europe over the five years to end-2004, but the percentage grew to 90 per cent last year. In 2005 continental European companies made just 74 per cent of their acquisitions in western Europe.

In the Bric economies, where 377 acquisitions were made from 2000 to 2005 with a total value of $52.3bn, the trend is more pronounced. The number of all UK acquisitions in these countries fell from 8 per cent to 2 per cent on the UK total, while US acquisitions rose from 1 per cent to 4 per cent, and European from 6.7 per cent to 10.2 per cent.

However, by value, the figures tell a different story. UK acquisitions by value are equivalent to those of mainland European companies. But that is accounted for by a small number of big companies with the ability to make high value bids, such as BP and its expansion into the Russian energy market in 2002 and 2003. BP accounted for seven of the top 32 Bric deals since 2000, while Barclays and HSBC accounted for two apiece.

The study suggests British companies may be too conservative in assessing growth possibilities in their economies and in their projections for domestic Bric companies.