Ireland: Top M&A Sectors

Formerly hailed as the Celtic Tiger, Ireland has emerged from the economic downturn of the last decade with a GDP that rose by 26.3 per cent in 2015. Its economic activity now measures in at a record €250 billion thanks to a doubling of exports and a capital stock which grew by €300 billion. It’s also now a favourite for M&A activity which, as we will see, is set to top that of the previous year.

 2015 seven-year high

The number of mergers and acquisitions in Ireland in 2015 rose by 10 per cent to 458 deals, with a combined value of €312 billion. Key drivers for these record-breaking figures included corporate migrations, hostile takeovers and legislative change aimed at reducing bureaucracy as well as an M&A-friendly tax system. The most notable non-M&A deal of 2015 was the proposed €143.5 billion takeover of Allergan by Pfizer.

2016: continuing the trend

In the first six months of 2016 M&A activity worth €17.7 billion took place in Ireland, with volume increasing by 9 percent to 58 deals.

Industrial and chemicals

The largest deal so far this year was USA-based Johnson Controls’ purchase of Tyco International, a fire and security provider, for almost €15 billion, which took place in August, highlighting the importance of the Industrial Products and Services sector to this economy. Another deal within this sector was Honeywell International’s purchase of Xtralis Pty for €392.3 million.

Technology, media and telecommunications

Traditionally one of Ireland’s strength areas, TMT has seen several notable deals this year so far; Hasbro, the games manufacturer, purchased the animation studio Boulder Media for an undisclosed sum. Boulder Media, best known for its reboot of Dangermouse, will partner with Hasbro to animate some of the company’s most loved toys, such as My Little Pony.

Elsewhere, Virgin Media bought UTV Ireland from ITV in a €10 million deal in July, uniting it with TV3 (a free-to-air TV Irish network). This will guarantee the supply of programmes such as Coronation Street and Emmerdale to the Irish public.

Real estate

A sector which is demonstrating increased deal flow, commercial real estate M&A started early in the year with the acquisition in January of two retail parks owned by Hazel Portfolio for €50 million by Oaktree Capital, the USA-based private equity firm. In June, the Blanchardstown retail centre in Dublin was purchased by anther US PE firm, Blackstone, for a sum around €950 million.

The Celtic Tiger may be regaining its roar as the country and the markets adjust to the idea of Brexit for the UK, while taking advantage of opportunities presented by opportune M&A deals, especially those offered by the USA.