Deal completions in the first quarter of 2025 are up by 39% on the same time last year, building on the resilience seen during 2024. Last year saw deal volume edge out 2023 by 1% and exceed broader European trends.

This strong start points to the continued attractiveness of Ireland as an investment location, characterised by strong private equity activity, international appeal and a market that is abundant with family and owner-managed businesses.

Deloitte’s Aine Sheehan, an M&A Director based in Cork, explains that there are plenty of reasons to be optimistic when you look at the tailwinds driving M&A activity in Ireland. A well-received national budget, combined with strategic government investments in infrastructure, innovation, and talent development, has fostered a stable and dynamic environment for deal-making.

International acquirers increasingly view Ireland as a strategic gateway to both the EU and UK, while private equity (PE) thrives on favorable market conditions.

However, the rapidly evolving geopolitical landscape continues to be a challenge.

“The recent shifts in international trade have caused some uncertainty and this is definitely trickling down to M&A. Deal makers are adjusting their investment priorities and carefully considering timing for making acquisitions and going to market. 

"That said, we have seen a shift in sentiment towards tariffs over the past few weeks, evolving from initial knee-jerk reactions to a more measured acceptance of the uncertainty. Business leaders are focusing on controlling what can be controlled and striving to become more resilient.” The impact of this global uncertainty will likely be seen in Q2, with a more cautious approach to deal making and sectors that are more exposed to tariffs experiencing a more measured pace of M&A.

“We are also seeing the ability to finance deals becoming more challenging, with financial institutions adopting a conservative approach to lending, particularly where potential tariff exposures could impact profitability and subsequently cash flows,” said Sheehan.

“However, we do expect M&A activity to tick up and remain robust across resilient markets and high-growth sectors, fueled by positive macroeconomic conditions and rising investor confidence.” 

Private Equity continues to drive M&A activity 

Direct PE investments and PE-backed trade deals played a significant role in driving M&A activity in Ireland in 2024 and across the first quarter of this year.

Technology, media and communications (TMT) continues to be the lead sector in Ireland’s M&A market. In 2024, three of the five largest deals in Ireland were in the TMT sector, comprising 22% of 2024 overall deal volume.

There has also been a notable surge in energy and resources, principally in the area of renewable energy, and driven by investment in sustainable and clean energy projects. 2024 saw some high-profile international deals in the sector, reflecting Ireland’s position as an attractive location for green energy generating assets.

Sheehan notes that, while volume is increasing, deal processes are becoming increasingly complex and protracted, with a significant expansion in the number of participants involved in the due diligence process, as well as the scope and scale of data analysed.

In addition to the traditional financial and tax diligence, potential buyers are increasingly also conducting diligence on technology, operations, ESG, and HR.

“Buyers will be keen to understand a target company’s exposure to tariff-impacted activities and markets. Key areas to focus on in due diligence would include supply chain exposure, financial exposure to tariffs (including how EBITDA margins or revenue streams may be affected), commercial contract reviews and regulatory reviews to ensure compliance with Revenue, customs and/or trade legislation,” she explained.

“We see time as being one of the biggest risks in a deal. As such, being well prepared in advance of an M&A transaction is fundamental to keeping momentum and ensuring a streamlined due diligence process with no surprises!” 

Focus turns to building value 

Alongside increasing due diligence, there is also a rising focus on value creation across the M&A lifecycle.

While traditional financial metrics remain crucial, Derek Murphy, Managing Director of Value Creation Services at Deloitte, highlights that today's environment demands a deeper focus on a target’s operations and synergy assessments to achieve sustainable value creation.

“In today’s dynamic world of M&A, unlocking a deal’s true potential requires a thorough understanding of the fundamental drivers of performance,” he says.

“Creating value is the ultimate goal of any M&A transaction. However, this endeavour is often challenging, with success hinging significantly on the ability to effectively integrate and avoid value erosion and dyssynergies, such as customer churn, inflated costs, and inefficient working capital cycles.” Murphy adds that to achieve cost resilience and optimise working capital, companies are increasingly focusing on process simplification, reshaping operating models, enhancing overall organisational efficiency, and leveraging technological infrastructure and automation.

“This proactive approach is equally important for sellers aiming to maximise value upon exit. Businesses should focus on sustainable cost and working capital optimisation well in advance of a proposed transaction to sustainably maximise profitability and cash. By strategically managing these elements, companies can ensure maximum value and a smoother integration process to unlock the full potential of the deal.”

Looking to the year ahead, Sheehan believes that the ability to be agile will be increasingly important as leaders seek to navigate and gain competitive advantage in the ‘new normal’ of market volatility.

“As history has told us, uncertainly is part of deal making. Key considerations and disruptions – economic, fiscal, technological and geopolitical – are now increasingly embedded into deals. M&A leaders and business owners need to be adaptable and agile in responding to challenges. 

These are no longer just a nice-to-have skills, they’re becoming core competencies. While challenges exist, so too do opportunities.” For more information, visit deloitte.ie.