Ireland’s mergers and acquisitions surge in three months to June – The Irish Times

Deals such as Blackstone’s €800 million takeover of data centre company Winthrop Technologies helped fuel a surge in mergers and acquisitions in Ireland in the three months to June 30, new figures show.

According to stockbrokers Davy, there were 108 mergers and acquisitions involving Irish companies in the second quarter of this year, an increase of 21 per cent compared with the 89 deals in the previous three months.

Deal volume in the second quarter was 11% lower than in the same period in 2023, but Davy’s M&A market analysis shows that the three months to the end of June last year saw higher-than-usual deal volume.

Analysts predict that around 400 deals will be completed this year, “which compares very favorably with historical levels as the market appears to have stabilized at a structurally higher level of M&A activity.”

One of the bigger deals in the three months to June was the purchase by US investment giant Blackstone of a 50.7% stake in Winthrop, valuing the Irish data centre specialist at €800m.

This follows investor Starwood’s decision to take a significant stake in Echelon earlier this year, underlining the popularity of Irish-linked data centre businesses with overseas buyers.

Other developments included DCC’s acquisition of Next Energy Solutions for €105 million and renewables group Copenhagen Infrastructure Partners acquiring a majority stake in wind and solar developer Elgin Energy for €292 million.

While many of the transactions involved the sale of Irish businesses to overseas buyers or private equity funds, there have also been cases of Irish companies buying out other businesses at home or abroad.

One of the largest was the listed food and food ingredients company Glanbia, which bought the US company Flavor Producers for around €280 million.

According to Davy, the most active sector was technology and telecommunications, with 21 deals, followed by business services with 20.

Davy believes that lower inflation and lower interest rates should spur mergers and acquisitions at home and abroad.

Donough Kilmurray, the firm’s chief investment officer, said inflation was falling below targets set by central banks in the United States and Europe, but more slowly than expected and likely due to weaker economic growth.

“This means that central banks will be able to gradually cut interest rates in line with expectations, although we will not return to the lowest levels of the last decade,” he added.

Kilmurray said markets were expecting relatively modest cuts in interest rates, with the cost of money remaining well above its average for this century.

However, the company notes that the onset of actual and projected interest rate cuts in Europe, the US and the UK will drive up M&A activity in the second half of this year.

The value of transactions in the second quarter of this year fell by 21% to €1.8 billion, but the report indicates that this figure includes only “disclosed values.”

The parties revealed that the value of transactions in the second quarter of this year amounted to only 13 percent, while in the same period in 2023 the figure was 17 percent.

Globally, activity remained flat, with the number of deals down 4 percent in the second quarter, but their value up by a tenth as more deals exceeded $1 billion.

Four of them were valued at more than $10 billion, including the acquisition of Marathon Oil by American oil giant ConocoPhillips for $23 billion.

Best deals of the year so far: