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Business optimism drives increased M&A activity in Munster
Strong funding environment and private equity market also fuelling transactions
Private business optimism, increased risk appetite, enhanced market liquidity in addition to the wider uplift in macro-economic conditions are fuelling increased M&A activity in Munster, according to Deloitte.
The M&A landscape in Munster and the funding options that are available to companies were discussed at the Deloitte Funding for Growth event which took place on Thursday, 22 March in the Hayfield Manor Hotel in Cork. The session focused on growth strategies for Irish businesses, and was attended by over 80 people including business owners, CEOs and finance executives.
Ronan Murray, Partner, Corporate Finance with Deloitte in Cork, with responsibility for the Munster region commented: “Within Munster, the optimism amongst private business is driving an increased level of M&A activity. Cork and Limerick, in particular, are experiencing a surge in activity with all measureable economic variables pointing in one direction - towards growth. The business fundamentals driving this activity are solid and the funding environment to support buy-and-build strategies is particularly strong. Against this backdrop, we anticipate strategic M&A in the region will remain a critical tool for growth and long-term shareholder value-creation.
“The good news is that the outlook for the region is also positive. Cork is ideally located to be the economic hub of the South and a viable development alternative outside of Dublin. The recently announced projects for the City Docklands and other ongoing developments such as Navigation Square, along with expected investments in infrastructure (M20 and N22) announced as part of the Ireland 2040 plan, will serve to boost the business economy and general connectivity of the broader Munster region.”
The current developments within the funding market and the options available were also outlined at the event by John Doddy, Partner and Head of Debt Advisory at Deloitte. John highlighted that there is an increasing number of funding options available to Irish businesses, including senior debt, unitranche, and mezzanine type facilities. He emphasised that assessing the appropriate level and type of debt to fund both medium to long term growth objectives is critically important.
Anya Cummins, Partner and Head of M&A at Deloitte, discussed the various types of equity funding options available to Irish businesses. The domestic private equity market remains buoyant following 2017, which was the highest year on record for private equity deals. Attendees heard that the underlying sector, strength of the management team, market share, growth opportunities and financial performance are the key factors considered by private equity in assessing the attractiveness of a business, and that preparation in advance of an equity capital raising process is key.
Guest speakers on the night also included Noel Creedon, MD and founder of iNua Hospitality and Aidan O’Shea, MD of Voxpro. They discussed the formulation of growth strategies and how a well-defined, sustainable business strategy is central to success and value creation in business.
The Deloitte Corporate Finance team in Munster provides support on M&A transactions, debt and capital advisory services, transaction services, restructuring services, valuations as well as on infrastructure projects across a range of industries including TMT, healthcare, hospitality, retail, education, energy and agri.
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