As the coronavirus pandemic continue to affect all aspects of life, it might be assumed that mergers and acquisitions (M&A) activity in Northern Ireland ground to a halt in 2020.
Certainly, market tracking surveys suggested that deal activity in the first nine months of 2020 was down over 50% on the same time period a year previously and the value of deals down by more than a third.
But while it is undeniable that some deals were put on hold or taken off the table, there was still plenty of activity over the year, with a particular rush in the final quarter.
Fortunately, Carson McDowell had a role to play in a significant volume of the transactions referred to in the latest survey by Experian, involving a variety of deal types across a broad range of industry sectors.
Unsurprisingly, much of the activity has been in sectors which have either experienced increased activity as a result of the pandemic, or been marginally affected by it in economic terms, for example the medical device sector, life sciences, the digital and technology space, food and food retailing, or waste management.
We have seen a mixture of M&A and fundraising activity in those sectors.
Companies which had capital to spend showed they still have an appetite to grow and take advantage of opportunities.
Eakin Healthcare Group acquired Armstrong Medical Limited just before Christmas, bringing two leading Northern Ireland based, globally focused medical device companies together.
In the broader healthcare sector James Leckey Design Limited, which manufactures and exports mobility aids, was sold to the international Sunrise Medical group.
In the technology sector Israeli-headquartered Mellanox Technologies acquired Titan IC Systems Limited.
Elsewhere, we've seen a number of private equity-backed deals, such as Options Technology Limited's second takeover in recent years.
We've also seen a continued appetite for fundraising this year, working with, among others Fibrus as it won the bid to deliver Project Stratum, a £350m investment to roll out full fibre broadband across NI regional and rural communities, STATSports as it continued to add sporting stars to its shareholder roster and in the life science sector, Sisaf.
It appears that strong businesses that have not been adversely impacted by the pandemic, remained attractive to buyers and investors who can see past the short-term issues and focus on the sound fundamentals of businesses.
By way of illustration, we advised on the sale of a business during the summer notwithstanding it had stopped manufacturing for the previous two months because of the pandemic.
The big question for investors looking at businesses which have increased revenues during the pandemic is: how much should we discount this period and look instead at historic trends?
Sadly, many businesses who have been adversely affected are asking the same question from the other side of the equation.
And while thankfully there hasn't yet been an uptick in distressed M&A activity, this may change in the most challenged sectors like hospitality, tourism and aerospace manufacturing.
On the upside, many strong local companies have managed to innovate their way through Covid, with Denroy pivoting to produce PPE face shields and Brett Martin producing plastic screens for offices and shops.
But, as well as the tragic human cost of the pandemic, there has been a huge financial cost to our economy and many businesses and their employees had to endure hardship in 2020.
Unfortunately, it seems certain that there will be more volatility before and during the recovery.
We should also acknowledge that Brexit has the potential to cause significant disruption, despite the deal on a future EU trading agreement, with many sectors experiencing supply chain difficulties, at least in the short term.
There's still hope that in the longer term businesses in Northern Ireland may be able to exploit opportunities from retaining access to both the EU and UK markets.
It is always difficult to predict too far into the future, but I am cautiously optimistic about what M&A activity indicates about the economy. Our firm begins 2021 with a good pipeline of projects and potential transactions, and we have recruited new members to our team in response.
The indications are that Northern Ireland businesses remain very attractive to external buyers and stand ready to make acquisitions themselves if the right opportunities arise.
Hopefully that is a sign of brighter times ahead for everyone.
Richard Gray is partner and head of corporate at law firm Carson McDowell