M&As treble to €4.2bn in first quarter

MERGER fever resulted in a trebling of merger and acquisition deals in the first quarter of 2007 to €4.2 billion, according to the latest figures from Ion Equity.

In keeping with recent trends property continued to dominate with deals worth more than €2 billion completed during the period.

Activity is likely to remain strong for remainder of year according to the group which is a big player in corporate finance and private equity investment with offices in London and Dublin.

The survey shows that Irish companies were involved in transactions worth almost €4.2bn in the first three months of 2007 compared to less than €1.2bn in the first quarter of 2006.

Ion director Joe Devine said: “While the first quarter 2007 figures were distorted to some degree by Quinlan Private’s €1.6bn acquisition of a portfolio of Marriott hotels, the figures show that M&A activity remains strong and is likely to remain strong over the remainder of the year.”

It was clear from the figures that business sentiment in Ireland remained strong with abundant capital for acquisitions from both banks and private equity investors.

“Equity markets might have wobbled in recent months but the fundamental drivers of business remain in good shape. It remains to be seen if fears of a US slowdown will spread to this side of the world but factors peculiar to the US economy, specifically exposure to sub-prime lending, are not as prevalent in Europe,” he added.

He pointed out that the current situation at Irish Continental Group, Independent News & Media’s wish to increase its presence in the Australian market and Riverdeep’s reported interest in a €3bn bid for Reed Elsevier’s education publishing business give an indication of the level of activity involving public companies. “And that doesn’t even include M&A activity by private Irish companies, much of which doesn’t even become public knowledge,” he said.

In a separate report Bank of Ireland said that M&A activity in Ireland in 2007 would be dominated by privately owned medium sized companies across a range of sectors.

According to its Irish Business Review recent figures show that Irish companies were involved in acquisitions and disposals worth more than €15 billion in 2006, an increase of over 20% on 2005.

Bank of Ireland is also forecasting strong growth to continue and to even accelerate in 2007.