This year is expected to be a mixed but promising one for merger and acquisitions (M&As) in the energy industry, according to KPMG’s annual M&A Predictor report.
As the market continues to stabilise, energy companies are positioning themselves for greater growth. The capacity of corporates to fund M&A growth is expected to rise by 11 percent for the oil & gas sector and two percent for the utilities sector.
Energy companies will continue to realise that they are making money, paying down debt and getting healthier, says Henry Berling, Managing Director and Head of US Energy Investment Banking at KPMG in the US. Overall, energy companies are now in a much better position to pursue transactions, although they might never reach the profitability of 2014 and earlier.
The renewables market remains an attractive prospect for 2018, underpinned by the trend towards cleaner generation, added Manuel Santillana, Global Energy and Natural Resources (ENR) Deal Advisory Lead at KPMG in Spain. In particular, Southeast Asia, China and India will continue their healthy growth into renewable energies and transactions.
To find out more about trends and key M&A deals in the energy sector, please download the full report here.
Credit: KPMG