The year 2020 will be remembered as a time of unprecedented global change. Yet, Ireland's M&A market has displayed remarkable strength despite the headwinds faced across the year.
Key Trends in Irish M&A
M&A Deal Value
Deal value rose 14% to 9.1bn, an impressive feat amidst the COVID 19 pandemic
Total inbound volume reached a new record of 121
PE activity jumped signi icantly by value and volume
56 DEALS WORTH
Key Sectors by Deal Volume
A number of key sectors saw strong activity by volume including:
M&A REVIEW 2020
There were 11 deals worth 250m or more, compared to only 4 in 2019
TELECOMS, MEDIA AND TECHNOLOGY
PHARMA, MEDICAL & BIOTECH
Stephen Keogh Head of Corporate/M&A
T. +353 1 639 5144 E. [email protected]
Welcome to the tenth edition of William Fry's Irish M&A Review, published in association with our data partner Mergermarket.
The year 2020 will be remembered as a time of unprecedented global change. Yet, Ireland's M&A market has displayed remarkable strength despite the headwinds faced across the year. In the face of uncertainties including the outbreak of the COVID-19 pandemic, the US elections and Brexit, total deal value rose 14% year on year in 2020, while deal volume managed to remain at 2019 levels.
The robust performance of Irish M&A in 2020 is especially impressive compared to overall European M&A, which fell by 17% in terms of volume, although value ticked up by 3%.
This is testament to Ireland's open economy, which continued to attract international interest from major global players throughout the year. Private equity players, in particular,
have been playing a greater role in the Irish M&A landscape, with the value of PE deals rising 105% year on year. Strategic Brexit-related acquisitions by UK and other international businesses also contributed to the strong performance in 2020.
Despite being initially struck hard by the COVID-19 pandemic, the Irish economy is already showing signs of a positive recovery. It is one of just two European economies expected to return to pre-pandemic levels of growth by the end of 2021. Ireland's EU membership will further aid its recovery, and it will benefit from the EU's 1.8 trillion recovery package for member states.
Positive news about a number of COVID-19 vaccines has provided some light at the end of a dark tunnel. As vaccines are rolled out across the globe, international markets should display more stability by the end of the first half of 2021. As a sense of stability returns to
global markets, we expect Irish M&A to pick up pace throughout 2021. This growing sense of optimism is reflected in the uptick of activity already seen in the last few months of 2020, which signals a bright future for Irish M&A as we enter a new year of dealmaking.
With Brexit's terms finally agreed, clarity over the UK's trading relationship with the EU will also inject more confidence into cross-border dealmaking and we expect to see more M&A activity from US and UK businesses looking to secure a foothold in the EU market over the course of 2021.
We hope you find this year's edition of the Irish M&A Review insightful. Do not hesitate to contact us with any queries regarding the Irish M&A market.
Stephen Keogh Head of Corporate/M&A
M&A REVIEW 2020 7
Stephen Keogh Head of Corporate/M&A
T. +353 1 639 5144 E. [email protected]
The outbreak of the COVID-19 pandemic sent shockwaves across economies throughout the globe. The Irish government moved quickly to mitigate the social and economic consequences of the spread imposing a national lockdown and launching a wide range of support mechanisms for those most impacted by the pandemic. Even with these measures, Ireland's economy was unavoidably hit hard. Following several years of growth, the European Commission's (EC) autumn forecast predicted that Irish GDP would contract by 2.3% in 2020.
Yet there is clear reason for optimism when assessing Ireland's economic outlook. The EC's autumn projection is far less severe than its summer forecast, which projected a 7.9% contraction in 2020. The forecast is also significantly ahead of the overall EU region, which the EC has predicted will contract by 7.4% over the same period. In fact, a recent EC forecast suggests that Ireland will be one of just two European countries to return to prepandemic levels of growth by the end of 2021.
Ireland's better-than-expected performance has largely been attributed to its strong export activity, particularly within the pharmaceutical and business services sectors, which saw demand soar amidst the pandemic. The value of Irish exports increased by 8%
to 122bn in 2020, according to the Central Statistics Office (CSO).
Ireland's GDP figure, however, conceals a very different domestic picture. The leisure and tourism industries were especially affected by the government lockdown, resulting in a sharp decline in consumer spending. This has led to a huge rise in unemployment. Although the seasonally adjusted unemployment rate in January 2021 was 5.8%, this figure is estimated to be as high as 25% when including claimants fo the Pandemic Unemployment Payment (PUP).
Given the volatile economic climate, the Irish M&A market's remarkable performance is all the more impressive. M&A value in 2020 rose 14% to 9.1bn, while volume stayed flat at 169 transactions. In contrast, overall European deal volume fell 17% over the same period to 6,760 deals, and value ticked up by a modest 3% to 739.4bn.
Although the Irish M&A market was understandably cautious in 2020, enduring drivers of activity continued to generate deals across a variety of sectors. The mid-market continued to make up the bread and butter of Irish M&A, with 85% of deals with disclosed value taking place within this price bracket (5m-250m). Ireland's open economy and vibrant startup talent continue to draw in
Irish M&A Quarterly Trends, 2013-2020
Volume Value (m)
Number of deals
00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 13 13 13 13 14 14 14 14 15 15 15 15 16 16 16 16 17 17 17 17 18 18 18 18 19 19 19 19 20 20 20 20
international buyers from across the world, particularly the US and UK, with the high-growth sectors of tech, pharma and business services attracting high demand.
The Irish economy experienced an impressive rebound in Q3, growing 11.1% following the temporary easing of restrictions, which prompted a resurgence of activity across sectors. This increased confidence was reflected in the M&A
market, which saw an uptick in activity in the final few months of the year. While further restrictions have been announced at the start of the year in the face of rising cases, the news of a global rollout of the COVID-19 vaccine has been welcomed by global markets, signalling a brighter future for Irish M&A in 2021. For 2021, much will depend on the speed at which governments can roll out their vaccination programmes.
Deal Value m
M&A REVIEW 2020 9
The mid-market continues to fuel the Irish M&A market. A total of 60 mid-market deals (5m-250m) were announced in 2020 which, despite registering a 9% drop in volume compared to the previous year, still accounted for an impressive 85% of deals with a disclosed deal value.
The upper end of the market was a highlight of Irish M&A in 2020. A total of 11 deals worth 250m or more were announced in 2020, worth a combined value of 6.3bn. By comparison, only four deals within this price bracket were announced in 2018 and 2019, each.
Much of the activity at the top end of the market took place in the second half, after dealmakers had had a chance to come to terms with the effects of the COVID-19 pandemic and price in its effects. The top five deals of the year were all announced in H2.
The largest transaction of the year was announced right at the end of the year, on 22 December. The 1.7bn deal (inculsive of debt) will see listed petrol forecourt operator Applegreen taken private by a consortium led by the company's founders and Blackstone Infrastructure Partners. The deal is an example of the impact of the energy transition, as it will allow Applegreen to invest in site upgrades, including electric vehicle infrastructure.
Irish M&A Split by Deal Size
Number of deals
4 12 3 43
2 36 28
12 30 24
11 21 28
Not disclosed <15m 15m100m 101m250m 251m500m >500m
The second largest of the year's deal was emblematic of another major trend, towards digitisation. The 1.1bn transaction sees the acquisition of Skillsoft, a global leader in digital learning and talent management solutions. Netherlands-based technology investor Prosus Ventures acquired a further 30% stake in the firm in November, for the sum of 424m.
The deal aims to create a global leading digital learning company, offering on-demand virtual content, customised learning journeys and an immersive learning platform. The outbreak of the COVID-19 pandemic has accelerated demand for online learning platforms as companies look
to retrain employees to adapt to fast-changing workforce demands.
The 624m acquisition of IPL Plastics by private equity firm Madison Dearborn Partners was the third largest transaction of the year, and another example of private equity's growing role in the Irish M&A market. A total PE deal value of 5.2bn in 2020 marks a 105% increase on the same period in 2019. Volume, meanwhile, rose 47% to 56 deals over the same period.
This healthy interest from international PE firms is part of what is driving the level of activity within Ireland's mid-market. The largest mid-
M&A REVIEW 2020
Top 10 Irish M&A Deals in 2020
Announced date Target company
Applegreen Plc (58.75% Stake)
29/07/2020 12/11/2020 11/11/2020
IPL Plastics Inc. Three Ireland (Hutchison) Limited Skillsoft Limited (30% Stake)
21/09/2020 29/01/2020 25/05/2020 12/06/2020
Inflazome Ltd. Decawave Limited Emerald Tower Limited Medtronic MiniMed, Inc.
Arachas Corporate Brokers Limited
Target dominant sector Consumer Business Services Industrials & Chemicals TMT Business Services
Bidder company B&J - Blackstone consortium Churchill Capital Corp II Madison Dearborn Partners, LLC Cellnex Telecom, SA Prosus Ventures
Pharma, Medical & Biotech Roche Holding AG
Qorvo Inc. Phoenix Tower International
Pharma, Medical & Biotech Blackstone Group L.P.
The Ardonagh Group Limited
Bidder dominant country United Kingdom
USA Spain Netherlands
Deal value (m) 1,699
624 600 424
Switzerland USA USA USA
380 363 300 299
market deal of the year saw US-based fund Further Global Capital Management acquire a controlling stake in roadside assistance firm AA Ireland for 240m. The previous owners Carlyle Cardinal Ireland (CCI) and Carlyle Global Financial Services Partners (CGFSP) had successfully carved out AA Ireland from AA plc, having acquired the firm for 157m in 2016.
Irish buyers were much more subdued in 2020, as companies looked to limit their spending
and focus on their core business amidst a challenging economic backdrop. The value of domestic M&A deals fell 18% year on year to 362.6bn, while the number of deals dropped from 55 to 48. The largest domestic deal of the year was Greencoat Renewables' acquisition of two onshore wind farms from Norwegian energy firm Statkraft. The 123m deal represents the first domestic investment for Greencoat, a specialist investor in green energy, and solidifies Ireland's growing reputation in the renewable energy sector.
Like the largest overall deal of the year the Applegreen take-private the Greencoat/Statkraft deal was announced late in the year, in the last few weeks of December, demonstrating a return to confidence at the end of a tumultuous year. The last quarter of the year, in fact, registered 5.3bn in activity, more than the previous three quarters combined a clear sign of the pent-up demand for dealmaking in the Irish market. While the road to recovery will be far from smooth, these figures are a positive indication of a more assured Irish deal market going into 2021.
Mire O'Neill Partner
T. +353 1 639 5177 E. [email protected]
The technology, media and telecoms (TMT) sector continued to attract the lion's share of Irish M&A in 2020, both in terms of volume and value. The sector accounted for 25% of total volume and 22% of value, while attracting three of the top ten deals of the year.
Demand for wireless soars The largest TMT deal of the year was CK Hutchison's 600m proposed sale of mobile operator Three Ireland to telco infrastructure firm Cellnex. The sale is part of a series of acquisitions undertaken by the Spanish firm acquiring CK Hutchison's tower assets across Europe. The total deal, worth a combined 10bn, also sees Cellnex acquire assets in Austria, Denmark, Ireland, Sweden and the UK, and is the largest deal ever undertaken by the Spanish company.
The transaction continues the trend of mobile operators carving out tower infrastructure assets to free up funds to invest in the 5G roll-out and fibre networks. In May 2020, Irish telco eir sold its tower assets, Emerald Tower, to Blackstone-backed telecom infrastructure group Phoenix Tower for 300m.
The outbreak of the COVID-19 pandemic has highlighted the importance of telecoms infrastructure, now needed more than ever to support trade, commerce and social activity.
As demand grows, the industry will generate a healthy pipeline of deals in coming months.
Health and life sciences under the spotlight Activity within the health and life sciences sector resulted in a series of high-profile deals in 2020. A total of 1.3bn-worth of deals were announced within the sector more than seven times the total in 2019.
The largest transaction of the sector in 2020 was Swiss pharma firm Roche's 380m acquisition of biotech startup Inflazome. Through the deal, the pharma giant will acquire Inflazome's entire portfolio, which tackles inflammatory diseases.
The spotlight has been turned on the sector following the outbreak of COVID-19, as companies urgently look to develop vaccines and provide efficient testing and effective treatments for the virus. At-home health testing startup PrivaPath Diagnostics (which trades as Letsgetchecked) raised 65m in a Series C funding round co-led by HLM Venture Partners and Illumina Ventures in May. The company will use the funds to increase its testing capacity for COVID-19.
Renewable energy takes centre stage The recently elected Coalition government has put action on climate change at the
M&A REVIEW 2020
top of its agenda, having pledged to halve Ireland's greenhouse emissions by 2030. The government's Renewable Energy Support Scheme (RESS) is viewed as central in achieving its goal of generating 70% of electricity through renewable sources by 2030. The subsidy programme will show preferential treatment to solar and offshore wind projects due to the longterm potential of these technologies.
Solar energy technology has seen significant investment in 2020, as PE firms recognise its potential for growth. Notable investments include the 150m investment in solar power producer Amarenco by Tikehau Capital and IDIA Capital Investissement. Amarenco plans to use the funds to fulfil its ambition to have 3GW of solar projects under construction by 2023.
Sector Split by Value
2% 5% 7%
Sector Split by Volume
2% 2% 2%
2% 2% 10%
3% 2% 8%
Hospitality and leisure face uncertain future The hospitality and leisure industry has suffered considerably due to the COVID-19 pandemic. The government has taken measures to support the industry, particularly through wage subsidy schemes. The gradual winding down of these programmes in 2021 will result in further uncertainty for the industry, however. As a result, real estate private equity firms will likely become more dominant in the market as they look to recapitalise Ireland's hospitality and leisure industry.
Key for above two charts: TMT Business services Consumer
Pharma, medical & biotech Industrials & chemicals Financial services
Energy, mining & utilities Leisure Construction
Transportation Agriculture Real estate
Inbound activity and Brexit
Andrew McIntyre Head of Inward Investment
T. +353 1 639 5184 E. [email protected]
Ireland's open economy, educated workforce and competitive tax rate has fuelled an influx of foreign investment in recent years. As of January 2020, Ireland was home to over 1,500 overseas companies employing an estimated 250,000 people. A total of US$1.15 trillion had been channelled into the country up to 2019, according to OECD data ranking Ireland sixth globally.
As an economy largely reliant on overseas investment, Ireland has been particularly vulnerable to the economic impact of the COVID-19 outbreak. Global FDI flows fell sharply in the first half of 2020 as forecasts of a global recession prompted companies to reassess their investment strategies. Yet despite market volatility, IDA Ireland reported continued investment in 2020 with 246 new investments and a net increase of almost 9,000 new jobs.
Martin Shanahan, CEO IDA Ireland, said, "In the context of the COVID-19 global pandemic, FDI's performance is remarkable. Sectors such as Life Sciences and Technology were much less affected and, in a number of cases, increased operations in response to demand for COVID related products, mitigating job losses in other sectors."
In line with FDI flows, inbound M&A has displayed resilience in challenging times. All of the top 20 deals of the year were inbound cross-border
transactions and overall, there were 121 inbound transactions worth 8.8bn announced across the year, a 6% rise in volume and a 16% rise in value on the previous year.
UK- and US-based buyers were most active in the Irish M&A market, carrying out 47 and 38 deals, respectively. Both countries recorded an uptick in activity compared to 2019, despite the challenges faced amidst the COVID-19 pandemic.
US-based buyers were responsible for 3.7bn of total value in 2020, the highest of any country. Furthermore, a US buyer was involved in the largest deal of the year: US-based alternative asset manager Blackstone was among the consortium which took over petrol station chain Applegreen for 1.7bn, including net debt. Moreover, US-based special purpose acquisition company Churchill Capital Corp acquired Skillsoft for 1.1bn a clear sign of confidence in Ireland's tech sector.
Ireland's business services sector continues to attract international attention, particularly in its recruitment sector which was experiencing strong growth before the COVID-19 pandemic. In November, Japanese HR group Outsourcing took over recruitment firm CPL for at an enterprise value of 254m. Outsourcing was attracted to CPL's extensive customer base and
M&A REVIEW 2020
Deal Value m
Irish Inbound M&A, 2013-2020
Volume Value (m)
Number of deals
0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 0 13 13 13 13 14 14 14 14 15 15 15 15 16 16 16 16 17 17 17 17 18 18 18 18 19 19 19 19 20 20 20 20
sees the acquisition as an opportunity to expand its European presence.
With a Brexit deal finally in place, Ireland could draw more such transactions, as international businesses seek a foothold in Europe. Already, Ireland has been an attractive location for firms seeking to relocate operations outside of the UK. According to EY's Financial Services Brexit Tracker, as of October 2020, Dublin was the top destination for relocations.
The roll-out of the first COVID-19 vaccine in Ireland and its biggest trading partners further signalled a brighter future for the global economy and a gradual end to lockdowns and restrictions. Following the announcement of the vaccine's progress, the OECD revised its 2020 growth forecast from -6% to -4.2%, while predicting growth of 4.2% and 3.7% in 2021 and 2022, respectively. These conditions are set to result in a greater confidence for inbound deal flow in 2021.
COVID-19 Effects on the Irish economy and M&A
Ivor Banim Head of London Office
T. +44 20 7961 0897 E. [email protected]
The COVID-19 pandemic is an unprecedented event, leaving governments worldwide to bear the consequences. The Irish government reacted swiftly to contain the spread of the virus, shutting down schools, discouraging mass gatherings and advocated working from home from 12 March 2020, before issuing a full countrywide lockdown on 24 March 2020. This cycle continued to varying degrees ever since from 21 October 2020 and again from 24 December 2020.
By choosing to follow the South Korean model of `test, trace and isolate' and establishing a widespread network of testing centres, Ireland avoided completely overwhelming its healthcare system, as was seen elsewhere in Europe during the onset of the virus.
The Irish government announced wide ranging measures aimed to support employees and businesses impacted by the pandemic. Income support schemes such as the Employment Wage Subsidy Scheme (EWSS) and the Pandemic Unemployment Payment (PUP) were made available to employees and the self-employed who have lost work due to the pandemic. The Irish government has also launched a range of loans, grants, vouchers, and other guarantee schemes, with varying degrees of success, to assist Irish businesses and to ensure the ongoing availability of credit during this uncertain and difficult time.
Despite the steps taken to limit the economic and social impact of COVID-19, the Irish economy has inevitably been impacted. After expanding by 5.5% in 2019, the EC's autumn forecast predicted that Ireland's GDP would contract by 2.3% over 2020. This, however, is a far better outlook than the 8.5% fall predicted in the EC's summer forecast.
Ireland's economy has also proved more resilient to the pandemic in comparison to its EU neighbours, with the autumn forecast projecting that the EU region would see GDP contract 7.4% in 2020. Significantly, according to the forecast, the EC expects Ireland to be one of just two EU economies that will return to prepandemic levels by the end of 2021. Ireland's M&A market has also displayed remarkable strength despite COVID-19 and other global factors. With vaccine roll out across the globe and resultant stability in international markets, it is expected that Irish M&A will continue to pick up pace throughout 2021.
Exports by multinational companies played a leading role to generate economic performance that exceeded expectations with value of Irish exports increasing 8% amidst the pandemic to 122bn, as of September 2020. Demand for medical and pharmaceutical products surged amidst the pandemic. Exports increased by
17% to 5.6bn in September 2020, making up 40% of total export value. As a global hub for pharma and medtech companies, this sector will continue to attract M&A interest in 2021.
Ireland appears to provide an example of the economic phenomenon, the "K"-shaped recovery. While GDP fared better than its EU neighbours, Ireland's domestic economy has been impacted by COVID-19, particularly for businesses operating in the hospitality and leisure and tourism industries. This has led the Irish lockdown experience to be described as "a tale of two economies".
At the peak of the crisis, the number of people requiring some form of state support, increased to more than 1.2 million. Furthermore, with Ireland's third nationwide lockdown announced on 24 December 2020, many businesses in the already vulnerable hospitality and leisure and travel and tourism industries are in difficulty. Unemployment looks set to remain a focus in 2021, with the winding down of PUP anticipated in April 2021. A wave of restructurings and related distressed M&A is anticipated in these beleaguered industries prevalent in Ireland attracting attention from international corporate buyers and private equity sponsors and their portfolio companies.
M&A REVIEW 2020 17
Mark Quealy Partner
T. +353 1 639 5130 E. [email protected]
Ireland's active private equity market has been a standout trend of 2020. While total M&A activity was steady, private equity firms continued to ramp up their presence in the Irish market.
A total of 56 PE transactions were announced in 2020, 47% more than in 2019, while value rose 105% to 5.2bn. Thirteen of the top twenty deals of the year had PE involvement an impressive performance given the challenges dealmakers faced in 2020. Ireland's PE activity outperformed that of Europe, which fell by 10% in volume terms to 1,973 deals, while value rose by a more modest 26% to 298.8bn.
Exits featured prominently in the top deals table, including the PE led sale of Skillsoft. Another notable exit deal was the 380m sale of biotech startup Inflazome to Swiss pharma giant Roche by a group of investors including Novartis Venture funds, Forbion and Longitude Capital.
Heightened exit activity may seem counterintuitive, given the uncertain economic climate. Yet company valuations in many sectors have held up despite the pandemic, propped up by an unprecedented level of economic stimulus from central banks. As a result, equity valuations avoided the sharp crash that many feared, and high-growth industries continue to yield attractive returns.
A total of 56 PE transactions were announced in 2020, 47% more than in 2019, while value rose 105% to 5.2bn.
The sale of biotech startup Inflazome, for example, reportedly delivered a sevenfold return to its investors.
International PE houses continue to be drawn to the Irish market, equipped with record levels of dry powder an estimated US$1.48 trillion as of July 2020, according to the data provider Preqin. Ireland's thriving venture capital ecosystem, which benefits from high levels of both state and private support, has resulted in a relatively high proportion of businesses achieving the scale they need to attract the attention of international PE firms.
US PE firms continue to be a particularly active presence in the Irish market. The largest buyout transaction of the year also the second largest PE deal overall was the 624m sale of IPL Plastics, a producer of sustainable packaging, to US-based Madison Dearborn Partners. Meanwhile, Blackstone Life Sciences' 299m investment in Medtronic MiniMed,
Number of deals
Irish Private Equity Deals, 20132020
Volume Value (m)
25 10,000 20 8,000 15 6,000 10 4,000
H1 H2 2014
H1 H2 2015
H1 H2 2016
H1 H2 2017
H1 H2 2018
H1 H2 2019
H1 H2 2020
a manufacturer of diabetes management equipment, is a strong show of confidence in Ireland's thriving medtech sector.
The largest sector by volume for PE activity was TMT, which recorded 19 deals a 58% rise on the previous year. Ireland's strong VC environment is resulting in a steady pipeline of high-growth companies coming to market. This trend is displayed in Qorvo's acquisition of Irish semiconductor startup Decawave, reported by the media as having a value exceeding US$400m. Founded in 2007, Decawave had previously closed a US$30m VC funding round in 2018. Google's 144m acquisition of ecommerce platform Pointy,
meanwhile, is another display of confidence in an Irish tech startup from a major global player.
Funding for Irish SMEs surged amidst the pandemic (albeit that much of this has been follow-on funding as opposed to investment in new portfolio companies), totalling 925m, up 13% on the previous year, according to Irish Venture Capital Association (IVCA). This healthy funding environment will continue to deliver a number of high-potential companies to market, meaning TMT and life sciences will continue to be sectors to watch in 2021.
Deal Value m
M&A REVIEW 2020 19
Outlook for 2021
As dealmakers look ahead to 2021, there are signs that the era of extreme uncertainty is drawing to a much needed close. Several positive indicators are behind this renewed sense of optimism: the commencement of vaccine roll-outs was a crucial achievement in the long battle against the virus, while Joe Biden's US electoral victory is expected to bring greater stability to global markets. Moreover, the long-awaited agreement on the terms of the UK's exit from the EU is sure to bring a renewed sense of certainty and thus optimism to the Irish M&A market.
The global economic recovery will likely be uneven in the first half of the year as lockdowns and travel restrictions persist. Yet the gradual roll-out of COVID-19 vaccines will result in a more sure-footed global economy in the second half of the year, prompting a renewed boost to dealmaking.
The tightening of EU screening rules could pose a challenge to inbound M&A activity over the course of the year. Interest from overseas buyers is typically a driving engine of the Irish M&A market, with inbound deals accounting for 49% of total deal volume in 2020. The EU Foreign Direct Investment Screening Regulation, introduced in April 2019, became effective in October 2020. The screening
mechanism allows the EC and other member states to place greater scrutiny on investment in strategic industry sectors and has become a priority since the outbreak of COVID-19.
While the Irish government currently has no screening on FDI in place (other than typical anti-trust rules), it has brought forward legislation to implement the EU Regulation in Ireland. The EU screening laws may put a question mark over certain inbound deals, and dealmakers will be keenly waiting to see the final terms of the Irish government's Investment Screening Bill 2020.
As an open economy, Ireland is particularly vulnerable to the global macroeconomic environment. Yet it means recovery will also be swifter. Indeed, Ireland's economy has proven resilient to the cataclysmic shock of the COVID-19 pandemic. While initially hit hard, it experienced near-record growth in Q3.
Strong economic fundamentals are set to drive further dealmaking over the next 6-12 months. Ireland's homegrown industries, particularly tech, pharma and business services, will continue to attract international demand, as a thriving venture capital ecosystem and healthy funding environment will continue to ensure a strong pipeline for deals.
The gradual roll-out of COVID-19 vaccines will result in a more surefooted global economy in the second half of the year, prompting a renewed boost to dealmaking.
Yet despite a booming export market, Ireland's domestic economy is a concern, with unemployment expected to rise in 2021. Greater interest from real estate-focused private equity buyers can be expected, as the hospitality and leisure industries get back on their feet.
Despite certain challenges on the horizon, there is every reason to believe that 2021 will be a year of regained certainty, particularly in the second half of the year. The gradual global economic recovery from the COVID-19 crisis, coupled with greater geopolitical stability in the form of the UK-EU trade deal, will provide the backdrop for a more confident Irish M&A market in 2021.
M&A REVIEW 2020
About the Research
The underlying data in this report comes from the Mergermarket database. Historical data contained in this report includes deals announced from 01/01/2013 to 31/12/2020, excluding lapsed or withdrawn bids or deals valued below 5m. Acuris Studios, the research and publications division of Acuris, publishes over 60 thought leadership reports and holds over 70 events across the globe each year, which allow clients to demonstrate their expertise and underline their credentials in a given market, sector or product. For more information, please contact: Jessica Reeves Publishing sales executive Acuris Studios Tel: +44 (0)20 3741 1370 Email: [email protected]
Acuris offers a range of services that give clients the opportunity to enhance their brand profile, and to develop new business opportunities. To find out more, please visit: https://www.acuris.com/publications
About William Fry
As one of Ireland's largest law firms, William Fry offers unrivalled legal and tax expertise across the full breadth of the business sector. M&A is core to our practice at William Fry. Our team has top-tier credentials, a wealth of experience and an impressive depth of expertise. We are consistently involved in the most sophisticated and complex corporate transactions in Ireland, including large cross-border deals. We focus on identifying and delivering on our clients' priorities.
With a staff of over 460, the Firm operates a large international practice with offices in Dublin, Cork, London, New York, San Francisco and Silicon Valley, and regularly acts on transactions involving other jurisdictions, including the United Kingdom, the United States, Asia, the Netherlands, Germany, France, Spain, Italy, Poland and Eastern Europe.
Recent awards include: Finance Dublin's Deals of the Year Awards 2020: M&A Acquisition, Public Markets: Avenue Capital's Investment in
Castlehaven Finance M&A Domestic FS: AIB & First Data's Acquisition of Payzone M&A Private Deal of the Year: Fane Valley Co-Operative Society
Acquisition of Silver Hill Foods M&A Mid-Market: Carlyle Cardinal Ireland Investment in The City Bin Co M&A Acquisition Financing Deal of the Year: ATA Group Acquisition of
Karnasch Professional Tools GmbH Equity Capital Markets Deal of the Year: Uniphar IPO
Recent rankings include: Consistently ranked in the top three of Irish advisers for Corporate/M&A
work by leading M&A league table houses and legal directories including Mergermarket, Thomas Reuters, Chambers Global, Legal 500 and IFLR1000 Top three for total deal volume in Irish M&A activity since 2010 (Mergermarket)
Recent directory commentary includes: William Fry are known for their "excellent international reach" which is
highlighted by sources, who appreciate the firm's ability to "manage overseas law firms on the client's behalf," as well as providing "one point of contact." They're noted by one client for "understanding crossborder financing extremely well," whilst another commends the team for "being helpful and willing to engage on matters relating to US and UK companies and subsidiaries." The Corporate team have been described as "outstanding" with a "strong client base in insurance, pharmaceuticals and financial services." Chambers Global 2020 Clients appreciate the team's ability to explain complicated legal matters. "The lawyers were able to break down complex issues to help ensure that everyone involved fully understood," says one interviewee, who also highlights the lawyers' "clear, robust and commercially focused advice." Another satisfied client adds that "their main strengths are their knowledge of our business and their instant availability when we need it." Chambers Europe 2020 The Corporate team at William Fry is noted for its "pragmatic approach". Clients have noted they have "excellent turnaround times and they're very good at explaining issues in layman's terms and a very pragmatic approach which worked well." Legal 500 2020 "William Fry are market leaders in identifying the order of priority and ensuring all matters are attended to, keeping the process on track. The team has significant strength in depth... You always get the sense that you are well advised when they are instructed on your behalf. Replies entail both commercial and legal principles and there is nothing that they won't have a good instinctive view on, even the most nuanced of matters." IFLR1000, 2021
Stephen Keogh Head of Corporate and M&A T. +353 1 639 5144 E. [email protected]
Brian Butterwick Partner T. +353 1 639 5219 E. [email protected]
David Cullen Partner T. +353 1 639 5202 E. [email protected]
Shane Kelleher Partner T. +353 1 639 5148 E. [email protected]
Andrew McIntyre Partner, Head of Inward Investment T. +353 1 639 5184 E. [email protected]
Ian Murray Partner T. +353 1 639 5129 E. [email protected]
Mark Quealy Partner T. +353 1 639 5130 E. [email protected]
Adam Synnott Partner T. +353 1 639 5108 E. [email protected]
Ivor Banim Partner, Head of London office T. +44 20 7961 0897 E. [email protected]
Eoin Caufield Partner T. +353 1 639 5192 E. [email protected]
Carol Eager Partner T. +353 1 489 6578 E. [email protected]
Barbara Kenny Partner T. +353 1 639 5146 E. [email protected]
Leo Moore Partner T. +353 1 639 5152 E. [email protected]
John O'Connor Partner T. +353 1 639 5183 E. [email protected]
Ronan Shanahan Partner T. +353 1 639 5103 E. [email protected]
Mark Talbot Partner T. +353 1 639 5162 E. [email protected]
M&A REVIEW 2020
Bryan Bourke Partner T. +353 1 639 5106 E. [email protected]
Barry Conway Partner T. +353 1 639 5284 E. [email protected]
Myra Garrett Partner T. +353 1 639 5122 E. [email protected]
John Larkin Partner T. +353 1 639 5224 E. [email protected]
Elaine Morrissey Partner T. +353 1 639 5068 E. [email protected]
Mire O'Neill Partner T. +353 1 639 5177 E. [email protected]
Breffni Sheridan Partner T. +353 1 639 5080 E. [email protected]
Paul White Partner, Head of US offices T. +353 1 639 5120 E. [email protected]
DUBLIN CORK LONDON NEW YORK SAN FRANCISCO SILICON VALLEY
The material contained in this publication is provided for information purposes only and does not constitute legal or other professional advice. It does not take account of specific circumstances and cannot be considered a substitute for specific legal or other professional advice. 20092021. William Fry. All rights reserved.