Merger and acquisition deals fall 31% to €1.61bn

MERGER and acquisition activity in Ireland fell by 31% on a quarter-by-quarter basis during the first three months of this year to €1.61bn worth of deals, according to new data from research specialists Experian Corpfin.

According to the latest research, 49 merger and acquisitions and equity transactions were completed between the beginning of January and the end of March. down from the 71 deals that were done in the final quarter of 2010.

First quarter activity was also down on a year-on-year basis. In the first quarter of 2010, €5.73bn worth of deals were done in the Republic. The corresponding period this year saw €1.61bn worth of deals completed. The volume of deals fell by 21%, when measured on a year-on-year basis, with 62 recorded in the first three months of last year.

The numbers also represented the first quarterly fall in merger and acquisition& activity since the same quarter last year. However, according to Wendy Smith — business development manager at Experian Corpfin — it isn’t a huge surprise, although it is disappointing.

“The figures mirror a Europe-wide trend and make disappointing reading after a 2010 that hinted a corner may have been turned in the Irish merger and acquisition& market, with a consistent quarter-on-quarter improvement both in the value and volume of transactions.”

Europe, as a whole, saw a 15.5% quarter-by-quarter fall in merger and acquisition & activity in the first quarter (and a near 28% year-on-year decline), with 2,192 deals recorded. Also on a rolling quarterly basis, the continent-wide combined value of transactions was down by just under 6% at €197.3bn. Quarter-by-quarter volumes fell by 10% in the US and by 23% in the Asia-Pacific region.

The Irish figures also showed a significant decline in large-scale transactions. Only three deals with a value of more than €120m were announced (totalling 929m) during the three months in question down from eight large deals (totalling €10.4bn) in the final quarter of last year.