A new survey reveals that 35% of Irish firms are considering engaging in a merger or acquisition over the next 12 months.
The survey, conducted by professional services firm Aon, found the main reason for the M&A activity is to protect and grow market share, while more than a third also said they were seeking efficiencies, or expansion into new markets.
Aon's survey also reveals that 34% of businesses are considering M&A targets across multiple jurisdictions.
The rest of EMEA (outside of Ireland) is the top overseas region (35%) for intended activity, while North America comes in at 18% and the rest of the world at 28% make up the other most popular target regions.
Aon said its survey also reveal high success rates for completed M&A activity with 64% of businesses saying that the move had achieved the compamny's objectives.
That success rate is higher for larger organisations, with 73% of businesses with 250 employees or more reported that completed activity had been a success, a 12% increase on last year.
Just 12% of these organisations stated that M&A activity had not yet achieved its strategic objectives.
Looking at the business sectors, 26% of firms surveyed in the Technology, Media, and Telecom (TMT) sector are considering M&A activity, with that sector leading the way in intended activity over the next year.
The Financial and Professional Services (FPS) sector comes in at a close second, with 24% of organisations in that sector also considering M&A activity, a 7% increase across the sector since last year.
Nearly half of TMT businesses are considering targets in EMEA outside Ireland, while 20% are looking at targets in North America and 31% at the rest of the world.
Clodagh Rochford, Head of M&A and Transaction Solutions at Aon Ireland, said that with the pace of inflation slowing and lower interest rates beginning to reduce the cost of capital, dealmaking conditions have undoubtedly improved over recent months.
"This is clearly reflected in the findings of our M&A in Ireland 2024 report which reveal that more businesses in Ireland are considering mergers and acquisitions than at any point in the last two years. Those who have engaged in M&A activity over the past 12 months have reaped the rewards," she stated.
But she added that the risk environment continues to grow in complexity.
"From cyber security and climate change to an evolving human capital landscape, businesses need to broaden their due diligence to take account of the changing business landscape and how evolving risk can impact valuations and possibly derail a deal," Ms Rochford stated.
"Given the high rate of successful transactions and possibility of further interest rate cuts in the second half of the year, there is good reason to believe that activity will further accelerate in the months ahead. However, with significant legislative changes on the horizon and heightened geopolitical tensions, businesses continue to navigate a complex and rapidly evolving M&A landscape," she added.
