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Irish M&A activity at near-record levels, data shows

Irish companies have attracted near-record levels of mergers and acquisitions (M&A) activity and volume in the year to April 2022, according to EY data, sourced from live database Dealogic and excluding real estate asset acquisitions.

The technology, media, and telecom (TMT) sector made up nearly two-thirds (63%) of the total deal value, while the volume of Irish M&A activity has increased by 21% for the first four months of the year, over the previous two years.

Sixty Irish M&A deals with a combined total of almost USD 3.3 billion in value were made in the first four months of 2022. Deals with no disclosed value have been included in volume analysis.

Inbound investment

Inbound investment from abroad accounted for most of this activity, representing 60% of the deal count and 70% of the deal value, and included names such as Global Shares, Wayflyer and Mainstream Renewable Power.

Fintech’s Global Shares, which was purchased by JP Morgan for $730 million, was the standout M&A deal in terms of value over the period.

Global private markets firm Partners Group will become a partner and majority shareholder in IT services company, Version One. 

This deal is valued at $867 million and is due to complete by mid-2022. 

In the TMT sector, investment was strong in companies such as Flipdish, Pradium and Tetra. 

The bumper M&A activity emanating from the Irish technology sector represented a massive 63% of the total Irish M&A deal value, and 27% of the deal volume in the first four months of 2022.

“There is no doubt that global investors are eyeing up Irish companies very closely as part of their core M&A strategic priorities, said Grit Young, EY Ireland valuations partner

Global trends

Similar global trends can be tracked for the first four months of the year.

In comparison to the same period in 2021, Irish M&A deal volume softened by 24%, versus a 42% decline for the UK. 

For the wider EMEA region, M&A deal volume fell 23%. 

However, over the previous two years, the volume of Irish M&A activity has increased by 21% for the first four months of the year. 

Strong M&A activity in 2022 so far has also been seen include the power and utilities, and life sciences sectors, including a one-off investment by Mitsui in Mainstream Renewable

Power Ltd for $632 million, giving the sector 27% of the total deal value for the first four months of 2022. 

Life Sciences saw five deals from January-April, compared to one deal for both 2019 and 2020 during the same period.

“The second half of this year should hold bountiful opportunities for Irish companies seeking opportunities in the M&A space,” added Grit Young.

However, this must be weighed against a more uncertain macro-economic backdrop resulting from inflation, the resurfacing of trade tensions, and geopolitical risks emanating from the war in Ukraine.

“These challenges might put the brakes on certain sectoral M&A activities. Ultimately, though Irish companies will likely remain firmly in the spotlight and top of the agenda for global M&A investors in the second half of the year,” he said.