Serious merger-mania got European stock markets off to a bubbly start this week, with a series of transnational mergers or takeovers having the corporate financiers in six countries drooling at the prospect of mega-fees.
There was nothing more than pure coincidence in the fact that almost £70 billion worth of acquisitions and mergers were announced on the same day, but it is a sign of the strength of stock markets that corporate activity has reached such a high level.
Bank of Ireland's £273 million recommended bid for New Ireland may be pretty small beer compared to the Zurich/BAT and Generali's hostile bid for AGF, but in the Irish context, the Bank of Ireland/New Ireland link-up has huge implications for the life assurance and pensions industry.
The £273 million price tag for New Ireland seems to represent full value, but for Bank of Ireland, New Ireland's strength in the pensions market fills a major gap that its own Lifetime business failed to fill. The fact that Bank of Ireland shares rose despite a 5 per cent placing indicates the market's approval for the deal.
For Irish Life, the under-bidder for New Ireland, there may also be implications if the Generali bid for AGF is successful. Cross-border hostile takeover bids in Europe are something of a rarity, but the Generali bid, while opportunistic, is seen as having reasonable prospects of success.
AGF is the majority shareholder in Church & General and Insurance Corporation, with Irish Life holding 30 per cent. If Generali is successful in taking over AGF, the main question in Ireland will be whether or not it intends to hold on to its majority stake in the two Irish insurance companies. Having failed in its bid for New Ireland, it would come as no surprise if Irish Life moved to buy out the majority shareholder on Church & General and Insurance Corporation.
With the imminent arrival of Mr David Went as chief executive, it would come as no major surprise to see Irish Life expanding into general insurance, not to mention the mainstream banking in which the new chief executive has years of experience.
The Guinness/GrandMet merger now seems set to ahead, after Bernard Arnault accepted a highly-lucrative compromise deal and the EU gave the go-ahead, subject to a few minor disposals. In Ireland, the focus of attention will be on Guinness's minority stakes in C&C and Edward Dillon. But Guinness's takeover of United Beverages - voluntarily referred to the Competition Authority - may also come under renewed scrutiny.
The Developing Companies Market - the Irish version of the AIM market is London - has got off to a pretty slow start with just telecoms minnow ITG taking a listing since the market began. But the prospects for the market have improved with Marlborough listing later this month.
