M&A | Select Recent Activity
GenNx360 Capital Partners, a New York, NY-based private equity firm has acquired SubSea Global Solutions, a Miami, FL-based leading global provider of ship maintenance, repair and marine construction solutions and a portfolio company of Lariat Partners, a Denver, CO-based private equity firm.
Weir Group (LON: WEIR), a UK based provider of engineering equipment and services to the minerals, oil and gas, and power markets is acquiring ESCO Corporation, a Portland, OR-based provider of highly engineered Ground Engaging Tools (“GET”) for surface mining and construction.
Gainline Capital Partners, a Stamford, CT-based private equity firm has acquired Integrated Energy Services, a New York, NY-based provider of grid relationship management software and demand response services to commercial electricity customers.
Strength Capital Partners, a Birmingham, AL-based investment firm has acquired ESP Associates, a Charlotte, NC-based professional services firm providing engineering, surveying and planning services to a variety of end markets including transportation, land development, and energy.
Public Markets | Key Trading Statistics¹
What We're Reading
Energy Markets | Growth Sectors of the Energy Economy
“The massive and historic transformation of the U.S. energy sector clicked into a higher gear in 2017. Renewable deployment grew at a near record pace. Energy productivity and GDP growth both accelerated, demonstrating that the U.S. economy can grow at a reasonable rate even as total energy consumption actually declines. Liquefied natural gas export capacity expanded, allowing the U.S. to become a serious player in global exports for the first time. Power and gas infrastructure build continued to support grid performance and natural gas delivery. Bloomberg New Energy Finance's report 2018 Sustainable Energy in America documents this evolution and that landmark developments shaping the current energy economy."
Oil & Gas | Increasing Financing Options Driving New Investments
“U.S. oil and gas producers expect their borrowing ability to increase over the next few months, leaving them open to invest in new shale assets. That’s the conclusion of Haynes & Boone LLP, which found that more than 80 percent of respondents predict their borrowing bases, or credit availability backed by collateral, will likely increase as banks conduct their biannual reviews. With West Texas Intermediate up 28 percent in the past six months, pressures have been easing on debt-loaded oil producers. They’ve used that to lock in prices - about 50 to 60 percent of their 2018 production has been hedged, and producers will use cash flow from operations, bank debt, and private equity financing as their main sources of capital to fund near-term expansion.”
Oil & Gas | Capital Spending Turns the Corner
“Capital expenditures among the world's largest oil and gas companies is due to increase 11.5 percent year-over-year in 2018 to just under $500 billion. Previous analysis from September 2017 targeted only an approximately 4% increase in 2018 spending. With oil prices having held above $60 per barrel for much of Q4 2017 and Q1 2018, companies have received more revenue and will have more projects on their books within a viable investment level - more confidence behind the health of the oil market and better oil prices have supported spending plans across companies globally.”
Energy Efficiency | The Growing Importance of Precision Weather Forecasting
“By some parameters, the weather has a direct impact on 50% of the world’s economic output, and the percentage is even higher when it comes to the energy industry. Overall, weather forecasting is still a nascent business with growing importance to energy efficiency. From offshore oil and gas rig operations to resource shipping, high voltage power lines to drilling site management, industry players have for decades been reliant on weather forecasts. But these days, by harnessing computing power and data science, near pinpoint accuracy in weather forecasting is helping operators enhance safety and manage disruption times down to levels few imagined as recently as 10 years ago.”
Power | The Year of Electricity
“The role of electricity in our economies and societies is growing rapidly. The power sector is becoming a critical actor in the global energy system – with implications for all fuels, including renewables, natural gas, coal and nuclear, as well as most energy technologies. The electricity sector now attracts more investment than oil and gas combined – a new milestone in the history of the energy sector. Global electricity demand doubled between 1990 and 2016, outpacing other fuels, and is set to grow at twice the pace of energy demand as a whole in the next 25 years. For these reasons, 2018 will be the year of electricity at the International Energy Agency - see below link for an overview of upcoming reports focusing on various aspects of electricity to inform and guide policymakers and the industry.”
Alternatives | The Evolution of EV Infrastructure
“For Americans who took the plunge and purchased an electric vehicle back in 2008, the move was fraught with risk. Battery life was certainly one issue, along with the fact that only one model was available for customers in the first half of that year. The country's charging infrastructure also presented a serious challenge to drivers with the U.S. boasting a mere 430 charging points in 2008. In 2009, that had only grown to 465. What a difference a decade makes. By the end of 2017, the number of outlets had surpassed 47,000 (including 6,270 fast charging outlets), with an increase of 18 percent since 2016 alone.”
Recent M&A Transactions¹‚²
Public Markets Overview
Energy Equipment and Services¹
Power Equipment and Services¹
ABI: Derived from the AIA’s monthly Work-on-the-Boards survey, an index score above 50 denotes increased billing from prior month, and vice versa.
DMI: 12-month indicator of future construction spending and demand for construction products / services.
3. Baker Hughes
4. U.S. Department of Commerce
5. American Institute of Architects
6. Dodge Data & Analytics