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Surge in Irish corporate deals this year

Tuesday, October 30 10:17:43

Ireland's merger and acquisition (M and A) activity increased in the first nine months of 2012 with 167 deals announced, representing a 10pc increase on the 152 deals completed in the same period last year.

That's according to the NCB Corporate Finance M and A Tracker Survey published today, which found that, of the 167 deals announced to date, quarter three accounts for 56 deals, representing a 14pc year-on-year increase, up from 49 deals completed in the same quarter last year.

The total value of deals for Q3 increased substantially quarter-on-quarter to E2,478m from E540m in Q2, but was down on the E4,571m recorded in Q3 2011.

"Overall, the third quarter of 2012 has been very positive as we see an increase in deal volume for the first nine months of the year compared with the same period in 2011. There was a slight change in sector trends this month as both the financial and building, construction and property sectors recorded a decrease in deal transactions. The surprise performer was the industrial sector driven primarily by two transactions by Ardagh Group and Petroceltic International," said Jonathan Simmons, Director of NCB Corporate Finance.

Foreign acquisitions by Irish companies continued to record further growth with the level of deal activity during the quarter increasing to 33 from Q2's already positive 28 deals. The trend of large Irish corporates continuing to acquire foreign companies was highlighted by Ardagh Group's acquisition of Anchor Glass Container Corp for a reported E720m and Smurfit Kappa's acquisition of Orange County Containers for E263m. Other foreign acquisitions of note were Glanbia's acquisition of Aseptic Solutions Inc for E49m and three acquisitions by United Drug totalling E100m.

With regards to sectors, the industrial sector accounted for 58pc of the total value of deals, or E1,299.9m. The sizeable deal value was driven predominantly by two transactions from Ardagh Group and Petroceltic International. In terms of deal volume, the industrial sector recorded 10 deals.

The building, construction and property sector recorded eight deals in Q3, including Kingspan's acquisition of Thyssenkrupp Construction and Rigidal Industries LLC, for a combined value of c.E97m. The health and pharmaceutical sector recorded five deals with a total deal value of E101m. This was primarily driven by United Drug's completion of three deals valued at E101m, transactions which saw the company acquire Pharmexx GmBH, Bilcare Global Clinical Supplies and Drug Safety Alliance Inc.

Surprisingly, the financial sector reversed its own trend recording its lowest number of deals in recent years. The sector saw three deal transactions in Q3 2012, down from a peak of 11 recorded in Q3 2011. The most notable transaction was AnaCap Financial Partner's acquisition of IFG Group (International Division) for E84m.