Green agenda playing more significant role in merger decisions

Katharine Byrne, Partner, BDO Corporate Finance, featured in The Irish Times special report on Mergers and Acquisitions. Read Katharine's extract below. 

Increased activity

BDO corporate finance partner Katharine Byrne foresees increased activity in the renewables sector in the near term. “Since the results of the first Renewable Electricity Support Scheme auction were awarded in September 2020, we are seeing the development of renewable energy projects that have been stuck in planning for a number of years and this in turn will drive more M&A activity, with international buyers seeking to buy up majority stakes in Ireland’s green market. Similarly, there is a lot of investment and cross-border activity in the cleantech sector with global tech companies and tech-focused funds looking to back the next disruptor.”

Deal structure could be a challenge, however. “As ESG continues to dominate the headlines from both a global-corporate and private-equity perspective, the challenge for many deal makers is to formulate an M&A strategy that can adapt to meet the needs of the buyers,” Katharine says. “Innovation underpins the growth of renewable energy and investors need to recognise the balance between the long-term nature of infrastructure and the disruption of new technologies. And while sustainability goals and targets are set at global and local levels, regulators and government support schemes are only catching up, which makes it harder for valuations and funding structures to be agreed.”

Content adapted from The Irish Times special report, 'Green agenda playing more significant role in merger decisions'