Thursday 30 March 2017

M&A worth close to $85bn done in record year for Ireland

‘The Irish data is dominated by the pharma industry with major deals’
‘The Irish data is dominated by the pharma industry with major deals’
Peter Flanagan

Peter Flanagan

Irish companies have been involved in takeovers worth nearly $85bn (€77bn) - far and away the biggest year for Irish M&A in history.

Data from ThomsonReuters shows that firms located in this country have taken part in deals worth some $84.7bn.

That puts 2015 well ahead of the $68bn done in 2014 and dwarfs the €21.7bn done at the peak of the Celtic Tiger in 2007.

During 2015 there were 392 deals involving Irish companies. The data is dominated by the pharmaceuticals industry, with a number of major deals involving companies that are domiciled here for tax purposes.

In the pharmaceuticals industry alone, five deals worth $47bn went through during the year. Those deals included Shire's blockbuster $33.7bn offer for Baxalta.

The pharma industry has seen a wave of takeovers worldwide as companies look to capitalise on tax advantages related to being based in Ireland.

Dublin-based Shire's deal for Baxalta was not a tax-based deal, known as an "inversion".

Instead, Shire is seeking to take control of Baxalta's drug portfolio which would give it haemophilia, immunology and cancer drugs. The takeover data however does not include arguable the biggest deal of all involving Irish firms in 2015.

Pfizer's merger with Dublin-located Allergan for $150bn is not classed as an "Irish" deal because Allergan's corporate headquarters is based in the US even though the company is domiciled in Ireland.

The major Irish law firms advised on 90 deals worth $32.8bn. A&L Goodbody led the group, advising on 24 deals worth $4.1bn, while William Fry was involved in 22. McCann FitzGerald had a seat at the table on 12 occasions, while Mason Hayes & Curran and Arthur Cox each took part in 11 deals. Matheson took part in 10.

In a sign of just how internationalised Irish business has become, some of the top law firms in the UK and US also advised in mergers and acquisitions here. The likes of Skadden, Davis Polk & Wardwell from New York, along with London's Freshfields Bruckhaus Deringer and Linklaters all feature prominently in Irish deals.

Big international finance firms also feature heavily as advisors to companies on takeovers.

Goldman Sachs took part in 14 mergers worth $59m. That puts it far ahead at the top of the list.

Goldman advised on deals across industries. The company is advising Baxalta on its takeover by Shire, and Betfair's on its merger with Paddy Power among others. Perhaps most notably it advised Aer Lingus when it was taken over by IAG.

It was not restricted to the target side of a takeover though. It had a seat at the table with Mallinckrodt when the bio-pharma firm bought out Ikaria for $2.3bn.

Bank of America, JP Morgan and Morgan Stanley between them took part in 30 deals valued cumulatively at $82bn. The data includes the full value of a deal for each advisor. That means that if two banks advised on a $10bn deal, the deal will is allocated to the two banks.

Davy and Goodbody only advised on three deals apiece, but those mergers were worth $6.5bn and $7.3bn in total.

Irish Independent

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