M&A in Ireland falls in third quarter, but value of deals climbs to €4.3bn

The number of mergers and acquisitions (M&A) in the Republic fell 29 per cent in the July-September period after a record-breaking second quarter, according to the latest M&A study from Investec Corporate Finance.

There were some 67 recorded transactions in the third quarter, with the total value of this activity estimated at €4.3 billion, the Investec M&A Tracker shows.

The biggest deals announced during the quarter were CRH’s disposal of its European distribution business to the Blackstone Group, which was valued at €1.64 billion, and Henderson Park’s deal to take real estate investment trust Green Reit private, which was valued at €1.55 billion.

These two large deals helped the value of deals rise from €3.9 billion in the second quarter, although that period saw 94 deals, which was the highest volume of transactions since Investec began tracking deals in 2005.

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Other notable deals include Pramerica Real Estate Capital's buyout of York Capital's stake in Core Industrial Reit, Avenue Capital's acquisition of a 25 per cent stake in lender Castlehaven Finance, and the acquisition of 23 Connecticut highway service plazas by a consortium led by Applegreen.

Irish companies made their presence felt during the quarter, with a total of 17 transactions, though this was half their number of second-quarter deals.

Active sectors

The IT and telecoms sector saw the most activity, accounting for 19 of the deals in the period. The health and pharmaceutical sector was also busy for M&A, generating nine deals.

The third-quarter activity was also down slightly on the 70 deals that took place in the same quarter in 2018.

Investec said the reduced number of deals was in line with global and European M&A trends.

“Having seen the volume of M&A transactions in the Irish market reach a new high water mark in the second quarter of 2019, maintaining that level of transactions was always going to be a challenge, in particular against the backdrop of Brexit uncertainty domestically and overall reduction in deal activity across Europe and elsewhere throughout the world,” said Investec.

Some 67 deals was “a strong result” in light of these headwinds, the company added. “A similar level of activity in the fourth quarter will round off a good year for Irish M&A.”