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M&A activity slides in first half of 2022

New figures show that there was a sharp drop in merger-and-acquisition (M&A) activity in Ireland in the first six months of this year compared with the same period in 2021.

A total of 122 deals in the six- month period represented a decline of 14% from a year earlier.

The value of these deals, at €6.4 billion, was down 66% compared with the first half of 2021, according to the latest William Fry Mergers & Acquisitions Review 2022, which uses data from the database of research firm Mergermarket.

William Fry pointed out, however, that both the volume and value of M&A activity in the first half of 2022 were still ahead of pre-pandemic levels.

Aircraft-leasing deal leads

There were five deals worth €500 million or more, which is more than the annual average since 2016.

The largest deal of 2022 so far was SMBC Aviation Capital's acquisition of aircraft-leasing rival Goshawk Management, which was valued at €1.5 billion.

The review shows that financial services was the most dominant sector in Irish deal-making, accounting for almost one-third of the transactions recorded in the first half of the year.

Deals involving energy, mining and utilities firms accounted for 8% of the first-half total – up from 4% in 2021. This was mainly due to activity in the renewables sector.

Cooling

In value terms, however, the technology, media, and telecoms (TMT) sector was the leader, accounting for almost 30% of total Irish M&A during the first half of the year.

“While there has inevitably been a cooling in the market compared to an extremely active 2021, M&A has returned to pre-pandemic levels of activity and, in the first half of the year at least, appetite for deals remained undiminished,” said Stephen Keogh (head of Corporate/M&A at William Fry, pictured).

Overseas buyers were responsible for nine of the top ten deals in the first half of 2022, but the total value of the 92 such transactions fell by almost 60% to €5.8 billion.

Private-equity deals

The William Fry review also found that seven of the 20 largest deals recorded during the first six months of the year involved private-equity firms, with the largest being Brookfield Asset Management’s €1.1 billion acquisition of Hibernia REIT.

The volume and value of private-equity deals, however, again showed significant drops compared with the same period last year.

Keogh described Irish M&A over the past few years as “extremely resilient”, with high levels of activity through the pandemic.

“While there are a number of negative political and economic factors to contend with, there is reason to be optimistic that Irish M&A will continue to prove itself to be relatively robust throughout the second half of 2022,” he added.