The Technology, Media and Telecoms sector continues to lead performance in Ireland's M&A market.
By value, TMT deals accounted for 79% of all activity during the first half of the year, helped in large part by Apollo's investment in Intel Corporation which alone accounted for 57%. Indeed seven of the 20 largest transactions of 2024 so far have taken place in the TMT sector, including the top two. Even when looking at deal volumes TMT accounted for more than a quarter of all deals, demonstrating the continued significance of the TMT sector for dealmaking across the market.
The prominence of TMT deals reflects global trends and also highlights the breadth of the sector as many of these are not pureplay technology transactions. Increasingly we are seeing a cross over into TMT-related infrastructure, with deals such as Phoenix Tower International's purchase of Cellnex's Irish mobile phone masts business being a good example of that theme and one that we expect to continue. Similarly, the TMT sector has been a catalyst for activity in other areas of the market. For instance, the sixth biggest transaction of the year to date, the €406m purchase of Winthrop Technologies by Blackstone, falls into the construction sector but again highlights the significance of digital infrastructure as it relates to engineering services for data centres.
Looking at other significant sectors in the market during the first half of 2024, business services, financial services, industrials & chemicals and pharmaceuticals, medical & biotech together accounted for half of all deals and financial services was the second largest sector by deal value, largely due to the AIB Group buyback. While these sectors still all trail TMT, it is notable that each of them saw an uptick in deal volumes when compared to the same period last year. Business services, for example accounted for 17% of deals in the first half of 2024 as compared to 13% in 2023. Although the majority of deals in that sector where smaller in size, driven for example by consolidation in the professional services subsector, it did also see some notable transactions such as Starwood Capital Group's €791m acquisition of a 50% stake in Echelon Data Centres (another example of technology as a driver of activity in other industries). The upward trend in deal volumes for these sectors is in contrast with TMT which, although still clearly the most active sector with 28% of all deals and dominating overall deal values, actually saw a slight decrease in the proportion of deal volumes from 32% in the same period last year.
Of the other sectors mentioned above, pharmaceuticals, medical & biotech, an industry in which Ireland continues to punch above its weight, has been the source of some of the year's higher profile deals. It accounted for four of the 20 largest transactions of 2024 so far – only TMT beats this figure – including, for example, the estimated €400m purchase of Dublin's Beacon Hospital by Macquarie Asset Management. The relative weight of this sector within the Irish economy mean it should continue to feature prominently going forward. Overall we can see that TMT continues to be the most significant component of the Irish M&A market, but a number of other sectors are also continuing to support deal activity. The outlook for the rest of the year looks set to continue along these lines but as always may be influenced by developments in global investment trends.
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