The mid-year William Fry Mergers & Acquisitions Report in association with Mergermarket reveals a steady start to 2015 with a total of 45 deals taking place in Ireland, worth €35.1bn.
The largest deal recorded was in the pharmaceutical sector with the purchase of Ireland’s Perrigo by UK-based Mylan for €32.6bn, creating the leading company in generics, over-the-counter and nutritional products. Other notable deals included the acquisition by Intercontinental Aviation Group (IAG) of Aer Lingus for €817m and the Lone Star Funds purchase of Jurys Inns Group for €911m.
Commenting on the mergers and acquisitions (M&A) landscape, Shane O’Donnell, head of Corporate and M&A at William Fry said: “Although the overall number of deals and value is slightly down when compared with this time last year, it’s been a steady and positive start to 2015. Ireland’s economic recovery is taking hold across more sectors and this is driving renewed activity at an SME level in the leisure sector and leading to a strong pipeline for the second half of the year. We’ve also recorded some big ticket deals in the usual strong areas of activity such as the pharma, medical and biotech sector.”
The leisure sector continues to perform strongly, with the first half of 2015 recording a steady stream of hotel purchases with a number of active market participants, including Dalata. With a total of 12 deals, this sector has already recorded more deals in the first half of 2015 than in the full year 2014.
As might be expected, the pharma, medical and biotechnology (PMB) sector performed well. Ireland remains the largest exporter of pharmaceuticals among EU countries. PMB deals accounted for 11% and 93% of deal volume and value respectively, with the high value reflecting the significant price paid by Mylan for the acquisition of Ireland’s Perrigo.
The funding landscape for deals is revealing new trends. There has been an increase in availability of debt and equity finance, showing renewed confidence in Ireland’s economy but interestingly the source of this funding is changing. Ireland now has the third largest alternative lender market in the EU, worth €2.9tn.
Also on the funding side, a total of eight deals were funded by private equity, with a value of €993m, a decline year-on-year of 33% in volume and 64% in value. This more muted involvement by private equity funds masks the fact that indigenous private equity funds are becoming increasingly active.