The majority of those involved in merger and acquisition deal-making in Ireland expect activity to rise this year, despite the record figure posted for 2021.

That is according to a KPMG survey of executives and leaders involved in mergers and acquisitions here.

It found that 58% of respondents expected the volume of transactions to rise this year – while 73% predicted that the price paid would increase.

That is despite a surge in deal-making last year, as pent-up demand created in the early months of the pandemic turned into transactions in 2021.

"Businesses are doing very well but there’s also a huge amount of capital available, so there’s a lot of competition for good Irish companies that want to exit," said David O’Kelly, partner in corporate finance at KPMG. "I think our respondents are seeing that they expect to drive more activity."

As a result, three quarters of respondents saw it as a buyers’ market, with both Irish and international organisations on the hunt for firms.

Companies in the technology and healthcare sectors are likely to see the most interest – as has been the case for some time now.

Meanwhile sustainability is likely to be a key consideration for businesses looking to make deals.

The majority of activity is expected to come from private equity firms – due to a significant amount of undeployed capital on the books of investment firms operating here.

"That’s perhaps not a surprise," said Mr O’Kelly. "Some estimates say about $2 trillion of private equity has been raised but has yet to be deployed.

"Even in Ireland, 10 years ago there were very few private equity funds but it’s almost approaching 10 private equity firms on the ground in Ireland now."

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And while most have a positive outlook about the year ahead, there are concerns too.

Nearly 40% of respondents worried that a skills shortage could hinder activity – with a lack of talent within would-be targets as well as acquiring firms having the potential to halt deals.

Meanwhile 25% were worried about the impact inflation could have on M&A deals.

Only 11% expressed concern about interest rates – despite increases being all but certain in the US and UK this year.

And despite the significant change brought about by Brexit in recent years, just 10% of respondents pointed to it as a cause for concern in 2022.

"It seems like businesses have learned to adapt – there's flexibility in their business models," Mr O’Kelly said. "It’s one of those risks that people are keeping an eye on, but it’s not creating a break in transactions."