A total of 300 qualifying deals were recorded within the Irish M&A Market in 2022, a drop of 2% since 2021 which was considered an outlier year. The total deal value came to €14.8bn, which is 38% lower from the figure recorded in 2021 but excludes the US$28bn offer by Amgen for Horizon Therapeutics, announced in December.
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Key findings for Ireland in 2022 include:
- 216 inbound cross-border transactions, worth a total of €12.5bn
- Seven deals worth €500m or more
- Total value of M&A activity in 2022 came to €14.8bn, with 86% of deals worth between €5m and €250m
- A total of 300 transactions represented a 2% decrease from 2021 levels, a remarkable achievement considering 2021 saw the most deals on record
- The financial services sector featured prominently in deals across 2022, accounting for 51% of Irish M&A by value
- Ireland's tech sector continued to be an important focus for M&A with technology, media and telecoms (TMT) accounting for 22% of all deals by volume during 2022
- Set against pre-pandemic levels of activity, 2022 private equity (PE) activity was strong with a total of 62 transactions.
Stephen Keogh, Head of Corporate/M&A at William Fry, noted:
"Ireland is not immune to the headwinds buffeting the
global economy. Rising interest rates, persistently high inflation,
slower growth in Western markets, war in Ukraine and global supply
chain disruption all present significant challenges. Ireland
appears, however, to be weathering the storm more comfortably than
many other countries and the economy continues to outperform. While
the bumper M&A year of 2021 was always going to be difficult to
match, the data for 2022 is strong despite something of a slowdown
in the second half of the year."
Megadeals
Mid-market transactions dominated M&A activity in Ireland in
2022. Almost nine in 10 Irish M&A deals fell into the
mid-market segment, with transaction values of between €250m
and €500m. The larger end of the market was also active, with
seven transactions worth more than €500m in 2022 having a
total aggregate deal value of €11.5bn. Only 2021, with 9 large
deals worth €16.2bn (the most on Mergermarket record),
exceeded these 2022 totals.
Sector Watch
The financial services sector accounted for more than half of
Irish M&A by value. The sector accounted for four of the 15
largest deals in Ireland in 2022. In terms of deal volume, the
technology, media, and telecoms (TMT) sector was the dominant
sector within the market. With significant transactions such as
Partners Group's acquisition of Version 1 and JP Morgan's
acquisition of Global Shares, the TMT sector accounted for 22% of
all M&A deals by volume in Ireland during 2022. The real estate
and infrastructure sector saw an uptick in activity from investors,
accounting for 15% of Irish M&A by deal value last year, up
from just 2% in 2021. Another sector worth singling out was
pharmaceuticals, medical and biotechnology, which accounted for 12%
of deals by volume in 2022, with the year ending on the
"mega-deal" announcement of Amgen's recommended
takeover of Horizon Therapeutics plc for US$28bn.
Inbound Activity
Overseas acquirers conducted 216 inbound transactions in the
country in 2022, one more than in 2021, but the total deal value
for inbound transactions fell by almost a third to €12.5bn.
All but three of the 20 largest deals of the year were inbound
cross-border transactions. Interest in Irish business is truly
global. Close to home, the country represents an obvious
opportunity for UK acquirers, accounting for 72 deals last year,
more than any other country. But buyers also came from across the
Atlantic as well as across the Irish channel, with US acquirers
pursuing 60 transactions. In value terms, Japanese buyers led the
way, driving €7bn worth of M&A deals, with the US in
second place, with €2.2bn.
Last year saw 84 deals that involved domestic players only, down
marginally from a total of 92 in 2021. Those included the
€1.1bn Hibernia REIT acquisition by Benedict Real
Estate.
Private Equity
Although 2022 PE activity failed to maintain the anomalous
levels of 2021 (year on year deal volumes and values fell by 19%
and 76%), it remained strong when set against pre-pandemic levels
of activity with PE buyers leading on a total of 62 deals worth
€2.6bn. PE activity in Ireland, which includes activity
involving both international funds and a small but growing number
of Irish firms, continued to be a growth feature of the Irish
M&A landscape in 2022. PE accounted for a fifth of all deals by
volume in 2022. While many of these were smaller mid-market
transactions, contributing to the fall in deal value, seven of the
20 largest deals of the year were PE-related, with five buyouts and
two exits. The biggest PE transaction of the year in Ireland were
both exits: Partners Group's acquisition of Version 1 Holdings
for €800m, and Motive Partners' sale of Global Shares to
JP Morgan for €665m.
While PE investors took a more restrained approach in Ireland in
2022, there was still much appetite for companies with a sound
business model. With this in mind, an optimism for Ireland
continuing to attract its fair and increasing share of PE interest
and activity remains.
Outlook
Looking ahead to 2023, Stephen Keogh concluded: "Irish M&A has proven itself to be extremely resilient over the past few years, seen through the impressive levels of deal activity throughout the global pandemic. The remarkably strong market for dealmaking witnessed in 2021 continued during the first and second quarters of 2022, before easing in the second half. The question is whether that slowdown continues or even accelerates in 2023 - the current global economic picture suggests that a cautious approach would be wise. Nevertheless, there are reasons to be positive about the outlook for M&A activity in Ireland with many advisers reporting strong pipelines of work".
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