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William Fry M&A Review 2013

Our Corporate M&A Department recently published the third edition of William Fry’s Annual M&A Report indicating that the Irish merger and acquisition (M&A) market is showing signs of sustained recovery from the lows that followed the financial crisis.  Deal activity has continued to increase, albeit marginally, year on year with 82 deals in 2013 up from 80 in 2012. Although deal value declined in 2013 to €18.9bn (down from €25.7bn in 2012), this value level is still significantly higher than the low levels seen in 2009.  The increased volume was driven by a number of factors including; an increase in large scale deal making, Ireland’s attractive corporate tax environment and the strong presence of foreign acquirers.  Indeed, the largest deals of 2013 have been driven by corporate acquirers using Ireland as a platform for international expansion, a welcome departure from some of the post crisis inspired M&A of recent years.

Key findings in the Report include:

  • 3% increase in deal volume and 26% decrease in value
  • Inbound deals accounted for 99% of aggregate M&A value and 73% of volume
  • 73% of M&A deal value concentrated in the pharma/medical/biotech sector driven to a large degree by a few very big deals
  • Key sectors by deal volume: TMT (20%), Financial Services (16%)
  • Largest deals partially driven by Ireland’s competitive tax environment
  • String of inverse takeovers – US companies relocating to Ireland as part of expansion

The Irish M&A market continues to show signs of sustained recovery. While deal value in 2013 dropped considerably (by 26% on 2012 activity), the market remains in a stable and healthy condition having moved on very significantly from the lows seen in 2009. There are ongoing challenges but there have been a number of positive developments. In addition to the very significant amount of foreign investment we have seen in the Irish Real Estate market and sustained activity in M&A, in late 2013 Moody’s upgraded Ireland’s rating to investment grade for the first time since 2011.  This upgrade should facilitate further investment from overseas.  The M&A market in Ireland is showing signs of recovery across a variety of sectors, particularly TMT and Pharma/Medical/Biotech and we expect this to continue in 2014.

Contributed by Bryan Bourke.

View the William Fry M&A review here.

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