In the year just passed Dublin's corporate finance market has regained momentum after the implosion of the tech bubble and the uncertainty resulting from global terrorism, which saw equity markets tumble in the early part of the decade.

Investment bankers who had spent their careers helping companies to list on the stock exchange spent much of 2002 and 2003 on "take private" transactions, where companies left the market, typically backed by private equity investment houses.

As the market recovered after events in Iraq, corporate management and investors started to take a longer-term view in 2004 and develop their strategies accordingly.

From an Irish investors' perspective, this meant that IPOs came back on the agenda. C&C and Eircom both floated successfully on the market and are now showing healthy gains for initial investors.

The subsequent sale of stakes in Eircom by other strategic holders has shown that the Irish market has matured to the best international standards, with Irish brokers having the global reach to ensure that Irish companies can rapidly develop a shareholder base of international institutions. Founder shareholders in IAWS, Paddy Power and Ryanair were also able to take advantage of the increasing depth of liquidity by selling shares to willing long-term buyers.

Smaller companies, too, were able to access the markets in 2004. Companies north and south such as Clearstream Devices and Andor Technologies, listed on AIM.

Resource exploration stocks such as Petroceltic and Providence financed their exploration programmes on the same market, while Abbey, a long-standing member of the ISEQ, opted for the less onerous regulatory requirements of AIM and the Developing Companies Market in Ireland.

The new year is expected to see the development of a new market in Dublin.

This will help to provide liquidity to smaller companies as AIM has done in the UK, with less rigorous entry requirements than are currently required on the Official List of the Irish Stock Exchange.

This initiative will be a positive step towards giving smaller companies access to the growing cadre of investors who are prepared to back such investments.

Just as investors increasingly looked beyond the immediate future in 2004, companies too saw a future beyond global uncertainty. Management teams looked ahead to the challenges of the coming decade and took decisions which will shape their businesses, whether in terms of market share, sector focus or geographic spread.

Specialisation continues to be the main driver, and companies such as CRH and Kerry continued to expand internationally in their core sectors.

Waterford Wedgwood sold its All-Clad cookware operations and is currently bidding for Royal Doulton in an effort to build scale as it focuses on its challenging core market.

North of the border, Warner Chilcott sold some of its longest-established operations back to founder Mr Allen McClay as it concentrated on its US ambitions in female healthcare. It also became the subject of an offer from a US-based private equity consortium.

In the home market, mergers and acquisitions (M&A) also continues apace. Danske Bank's purchase of NIB brings a new player to a sector where HBoS and Royal Bank of Scotland have already grown their presence in recent years, through the purchases of ICC and First Active respectively. Expect more of the same in 2005, with Irish Nationwide in the frame.

The Grafton/Heiton deal is currently under review by the Competition Authority. Many other companies are steadily building businesses in Ireland, including listed CPL which enlarged its stable of target sectors with the acquisition of Medical Personnel.

This is just one example of the development of the support services industry, where the trend towards outsourcing has seen acquisition-driven companies address markets traditionally serviced by in-house personnel, or by the State.

Waste, security services, plant hire, engineering services are among the sectors experiencing this trend, which will continue in 2005, with smaller operators gobbled up by more ambitious, well capitalised companies.

Following the years of tourism boom and a difficult 2003, many hotel properties changed hands, and this also will continue in 2005 as chains develop to target different market segments.

Another boom sector of the late 1990s, technology, saw a recovery during the year, with some significant fundings and M&A deals taking place. These included Hostelworld, Adaptec's acquisition of Elipsan (a spin-off of Eurologic), Avaya's acquisition of Spectel and the development through M&A of well established Irish technology companies such as Openet, Comnitel, Xpert Technology and Mentec.

In 2002, M&A was dead. In 2003, IPOs were dead. 2004 saw both come back to life. The overall picture is not that some form of activity disappears - it simply becomes less relevant for a while as circumstances change.

The real trend is that every year, more and more options are available to shape and finance businesses. Leveraged acquisitions by private equity investors led to the two main IPOs of 2004 - Eircom and C&C. Private equity and IPOs are not incompatible, they are symbiotic. Yesterday's "take private" deal is tomorrow's IPO.

Increasingly, M&A deals can be arranged to sculpt businesses to the shape desired by management - debt and equity are both readily available for well thought out strategies.

Off-balance sheet finance can be used to mitigate risk and withdraw equity from projects as they mature.

The outlook for 2005 is very positive and companies now have an array of financing options available to help them to meet the challenges in their industries; to expand aggressively by way of acquisition; and to realise the value in their businesses.

Brian O'Kelly is managing director of Goodbody Corporate Finance