Merger activity maintains pace


Merger activity in the Republic in the year to date has kept pace with the high number of deals recorded in 2004, according to the latest figures from the Competition Authority.

The numbers show that that 48 large deals have been notified to the Competition Authority for its consideration since the start of the year.

This compares to a total of 48 notifications over the same period last year, suggesting that the business world has lost no confidence in the economy.

Mergers and acquisitions are viewed as a leading indicator of economic performance, since they often imply investments being made ahead of an expected economic upturn.

The merger notification data show a particular flurry of activity in the media sector, which accounted for nine of the 38 notifications.

Four of these came in radio broadcasting, while four fell under a broader "media" category.

The remaining deal related to a newspaper purchase.

Part of the reason for the high number of media notifications is that all mergers or acquisitions in the sector, regardless of size, must be referred to the Competition Authority.

The sector has however provided a number of large deals in the year to date. One of the most notable of these was Ulster Television's €145 million purchase of British radio company, the Wireless Group.

The mergers included in the Competition Authority's records represent only a portion of the Republic's takeover deals over a given period.

A large number of transactions outside the media sector will be too small to fall within the Competition Authority's remit.

Under rules in force for the past three and a half years, all companies buying other firms must inform the Competition Authority of their intentions where one party has a turnover of €40 million or more and operates in the Republic.

Among the larger deals to be notified so far this year is Diageo's €300 million takeover move on Bushmills.

Emap's €588 million takeover of Scottish Radio Holdings, which had extensive media interests in the Republic , was also considerably larger than most other deals.

Of the mergers notified so far this year, most have been cleared by the Competition Authority.

Seven files, most of them recently filed, are active, while one notification was withdrawn.

The Competition Authority has sought further information on another four deals.