InsightsM&A ReportPrivate Equity Ireland M&A Report – H1 2024

Private Equity Ireland M&A Report – H1 2024

RENATUS PRIVATE EQUITY M&A H1 2024

The M&A deal data for the first six months of the year, shared exclusively with The Currency, offers a deep insight into the M&A and fundraising climate in Ireland. The report identifies the sectors that are being chased by domestic and international money. The report also shows where that money is coming from – both in terms of geography and investment type.

1. M&A activity H1 2024 versus H1 2023

Irish M&A Activity has increased in H1 2024 versus H1 2023:

There were 207 deals completed in H1 2024 compared to 195 in H1 2023:

  • With 207 deals in the first half of 2024, M&A in Ireland is trending ahead of levels realised in H1 2023. The activity in the market in Ireland continues to be rife with the consolidation of the professional services sector which accounted for 31 deals in H1 2024 and 27 deals in H1 2023. There is also increased activity into the software sector which represented the most active sector in 2024 so far with 32 deals compared to 18 in H1 2023.
  • From a PwC report, global M&A has seen retracted figures for H1’24. Overall transaction volume was down by 30% compared to H1’23 with just over 21,000 deals in the first half of 2024 with a total value of c. $1.3tn, noting a 5% increase on H1’23.
  • It is important to note that over the period from 2023 to 2024 Ireland has seen inflation decrease from 5.2% in 2023 to 2.2% in Q1’24 with further forecasts from the European Commission for inflation to drop further to 1.9% for 2024 and 1.8% for 2025.
  • These promising signs have led to the recent announcement by the ECB to begin to cut its interest rates lending to a favourable environment for acquisitions looking into the next half of the year.

2. M&A by Acquirer Type

Irish M&A by Acquirer Type

Breakdown of International Acquirers

Breakdown of Private Equity

The number of “In Market Transactions” continues to hold pace in H1’24 with a greater market presence from both Irish and International Private Equity deals toward the end of 2023 and into 2024.

  • International Acquirers: There was a significant drop in international companies acquiring Irish companies from H1’23 (90) to H1’24 (58). However, this reduction was mitigated by the increase in international PE acquiring Irish businesses growing by c. 130% from H1’23 (9) to H1’24 (21).
  • The geographic composition of International Acquirers has also changed slightly from H1’23 to H1’24. A greater proportion of business from the UK and Europe have been acquiring Irish businesses while the proportion of US acquirers decreasing by c. 7% in this period.
  • Domestic Acquirers: This year has seen a notable shift in M&A in Ireland toward Irish-based business acquiring both in-market and abroad. The number of in-market deals has grown from 52 in H1’23 to 69 in H1’24 with outbound deals mirroring this trend going from 34 to 40 in the same period.
  • Private Equity: Private equity has seen a rise in acquisition from lows in late 2022 with Irish PE acquisitions rising from 4 deals in H1’23 to 12 in H1’24 and International PE going from 9 in H1’23 to 21 in H1’24. UK-based funds represented the largest proportion of international PE in H1’24 completing 12 of the 21 deals. They were in the following sectors: Software (4), Print & Packaging (2), Hotels & Pubs (2), Financial Services, Medical Devices & Pharma, Engineering Services and Telecoms/Tech Services.
  • M&A in Ireland continues on its upward trajectory as it remains a key hotspot for international acquirers and private equity with a newfound increase in deals by Irish businesses also.

3. Sector Breakdown

M&A Breakdown by Sector

‘Other’ category includes : Aerospace, Bio Pharma Engineering, Electronics, Health & Beauty Services, Precision Engineering, Recruitment, Public Sector Solutions, Travel Sector Solutions, Waste, Other Retail

Software:

  • The software sector has seen significant growth to become the most acquisitive sector in Ireland going from 18 deals in H1’23 to 32 deals in H1’24 representing a c. 70% increase.
  • This sector also has been heavily targeted by private equity with 9 of the 32 deals in 2024 coming private equity firms and the majority of these from international funds (7). The composition of foreign private equity came from UK (4), US (2) and Norway (1).

Financial Services:

  • The Financial Services sector continues to see consolidation with the number of deals rising marginally from 27 deals in H1’23 to 31 in H1’24. Insurance companies and accountancy practices remain active spaces in this sector with insurance acquisitions representing 11 deals of the 31 and accountancy acquisitions representing 10 in H1’24.

Telecoms / Tech Services:

  • Telecom/Tech remains an active space but has seen a slight decline in deal numbers from 27 in H1’23 to 15 in H1’24. Even with the drop in deal numbers, the sector remains one of the most active and robust sectors in Ireland. Notable deals such as Starwood Capital’s c. €800m strategic investment in Echelon underpin this sector.

4. Fundraising

Irish fundraising activities have seen a considerable decline in the volume of fundraisers in H1’24 compared to H1’23.

  • The decline in the number of fundraisers completed in Ireland has been significant from H1’23 to H1’24 dropping from 102 to 77.
  • Of the 77 fundraisers, 9 gained a fundraise amount of > €50m with two of the top 3 fundraisings going to AIB receiving €500m and €625m along with Avolon which raised €699m. For the 9 companies that raised > €50m, the total fundraise amounts represented 89% of the total fundraising that occurred in Ireland for H1 2024.
  • The software sector accounted for the highest number of fundraisers in H1’24 with of 41 out of the total 77 completed fundraisers being accounted for in this sector.

5. Outlook

The Irish economy has seen a strong start to the year in terms of M&A, unlike much of the international market, largely due to Irish economy’s resilience in recent years which has not “wobbled like our neighbours across the water” as highlighted by Renatus’ Kyle Barry.

These tailwinds are supported by the software sector, which “performed strongly” according to Conor Mehigan of Renatus, along with continued activity within the financial services sector and the telecoms/tech services sector. Such sectors will likely continue to drive the number acquisitions on the island of Ireland into the future.

Looking onto the next half of 2024 and beyond, Ireland’s M&A activity is unlikely to abate backed by private equity activity which is on the rise. A combination of overdue exits and unallocated capital will create an active space within Ireland in the years to come. 

Source: The Renatus weekly M&A newsletter was the main source of our report data.


Sign up to the
Renatus Newsletter