| International interest in technology and large deals |
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| What is the level of international interest in Irish M&A deals and what are its characteristics? |
ABN AMRO
We believe that there could be considerable international acquisition interest in the likes of BOI, AIB and ILP in the coming 12 months if their low relative valuations persist and the strong economy does not show further signs of overheating.
AIB Corporate Finance
More and more the interest expressed by international companies tends to be on the larger company acquisitions principally relating to financial services, telecom, media and technology sectors. This trend was clear in 1999, which saw some of the largest transactions in Irish corporate finance history. At AIB Corporate Finance we were pleased to have played a role in most of the transactions including advising the Government on the Telecom IPO, advising Newtel in its offer for Esat Telecom while in the insurance sector we acted for Hibernian in its take-over discussions with CGU.
BDO Simpson Xavier Corporate Finance
We completed eight sales mandates last year, of which six were sold to international players. There is considerable interest, despite some UK pessimism, in the Irish sector. Also, international companies are following their customers to Ireland and therefore need to acquire businesses to service these customers in case they get lost to competitors. Therefore, for well run businesses with a very good customer base, in particular international companies, the future for outright sale looks good.
CFI
Because of the success of the economy there is a sense that international institutional investors are interested in having an Irish dimension to their portfolios. US companies, are more likely to develop their own business here rather than make an acquisition. The Irish market is not of particular interest internationally, being about the size of Maine, but it’s strategic value is recognised. Most Irish institutions are not interested in investing in Irish companies whose potential market is confined to the home market. However, IT companies in particular are rarely restricted in this manner.
Chapman Flood Mazars
International buyers continue to be interested in Ireland, however, these deals are mainly strategic position to ensure a global presence to enable them to service a specific customer requirement.
Davy Corporate Finance
In an increasingly competitive market there are now many international advisors who are happy to get involved in Irish M&A deals even if they represent small transactions relative to average UK or US deals. Sometimes an Irish advisor is also given a role but not always.
Dolmen Corporate Finance
Little interest apart from financial services and technology but this changes with business cycles.
Deloitte Corporate Finance
We have seen significant interest in Irish companies by international acquirers. These companies seek Irish acquisitions for a number of reasons including the following:
• Access to the EU marketplace
• Highly educated workforce in Ireland
• Reducing tax rates
• ‘Celtic Tiger’ economy
• Weak exchange rate
Ernst & Young
Low interest outside of technology stocks
Goodbody Corporate Finance
A higher level of international interest in Irish M&A deals exists in the technology and telecoms sectors. Outstanding value (relative to the US market, for example) or the desire to acquire a specific technology drives this interest.
Grant Thornton
International interest is high, however, it is confined to large deals or specific industries.
IBI Corporate Finance
International interest will always be present for the larger plcs. As the size of the company decreases, so does the interest.
Merrion Capital
Strong interest especially in IT where international firms are looking for enabling technologies, internet plumbing, internet content and wireless applications, lower level of interest in other areas, with the exception of financial services.
NCB Corporate Finance
The level of international interest in the larger Irish deals has definitely increased. This is evident when you look at deals like BT/ESAT and the Eircom strategic alliance. London based advisors are focussing on the market, especially in the direction of large IPO’s and at financial sector consolidation.
PricewaterhouseCoopers
International interest remains strong. Potential acquirers include: international groups seeking significant market share in Ireland; UK purchasers appreciating the superior growth rates here; technology investors recognising the phenomenal performance of Irish technology companies and managers in global markets. |
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| Article appeared in the March 2000 issue.
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