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Mike Rosendahl

E: mrosendahl@pcecompanies.com

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Industry Trends

Oil Demand Remains Consistent with Previous Estimates

OPEC maintains a bullish outlook for oil demand growth, forecasting increases of 2.2 million barrels a day in 2024 and 1.8 million barrels a day in 2025. Key demand drivers are summer travel in China and OECD countries. Despite gradual production cut reversals, market absorption concerns persist. Analysts emphasize the need for supportive economic news for a sustained recovery, as speculative selloffs and mixed economic indicators contribute to market volatility.1

Investments into US Power Grid to Spur M&A

Utilities are adopting new technologies to boost transmission capacity amid surging electricity demand. The Biden administration's $3.5 billion investment in grid-enhancing projects is expected to spur M&A activity as companies seek innovative solutions. Grants for dynamic line rating sensors and high-performance wires will modernize the aging grid, optimizing power distribution to handle increased loads from electric vehicles, data centers, renewable energy, and extreme weather conditions.2

Oil Consolidation Remains Active

Oil-patch consolidation intensifies as ConocoPhillips acquires Marathon Oil for $22.5 billion, following Exxon Mobil and Chevron's major deals last year. This acquisition spree, which includes about a dozen tie-ups since October 2023, underscores the trend of major U.S. producers consolidating assets. Conoco's deal, offering a 15% premium on Marathon's stock, aligns with industry standards. The remaining companies, such as EOG Resources, Devon, and Coterra Energy, may become acquisition targets as the M&A momentum continues in the oil sector.3

Tech Setting Their Sights on Nuclear Power

Tech companies, including Amazon Web Services, are negotiating with U.S. nuclear power plants to supply electricity for data centers, driven by AI demand. This shift could strain the grid, raise costs, and complicate climate goals. These deals offer nearly uninterrupted, carbon-free power, potentially accelerating data center development without new infrastructure. However, reliance on nuclear energy might divert existing resources, increasing dependence on natural gas and sparking concerns over grid reliability and economic impacts.4

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • NuStar Energy L.P.
  • Sunoco LP
  • $7,399.15
  • Carlisle Interconnect Technologies Inc.
  • Amphenol Corporation
  • $2,025.00
  • CSI Compressco LP
  • Kodiak Gas Services, LLC
  • $885.65
  • Durango Permian LLC
  • Kinetik Holdings Inc.
  • $842.76
  • Natural gas facilities of TalenEnergy Corporation
  • City Public Service of San Antonio
  • $785.00
  • Nehring Electrical Works Company
  • Mueller Industries, Inc.
  • $600.00
  • Unregulated Electric Utility Business of Cleco Cajun LLC
  • Atlas FRM LLC
  • $600.00
  • Gulf Coast Express Pipeline LLC
  • ArcLight Capital Partners, LLC
  • $540.00
  • Industrial Motors and Generators businesses of Regal Rexnord Corporation
  • WEG S.A.
  • $400.00
  • Gulf Coast Liquids Pipeline System of Easton Energy LLC
  • ONEOK, Inc.
  • $280.00

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Gaucho Solar and Nestlewood Solar projects of Vesper Energy Development LLC
  • Octopus Renewables Ltd.
  • n/a
  • Unison Energy, LLC.
  • Tiger Infrastructure Partners LP
  • n/a
  • Allium Renewable Energy, LLC
  • Lotus Infrastructure Partners
  • n/a
  • Operational onshore wind farm in south Texas, US
  • Infrared Capital Partners Limited
  • n/a
  • Discovery Energy LLC
  • Platinum Equity, LLC
  • n/a
  • Master Magnetics, Inc.
  • Factor 89 Partners LLC
  • n/a
  • Ampure
  • Transom Capital Group, LLC
  • n/a
  • Heelstone Renewable Energy, LLC
  • Q-Energy Private Equity, S.G.E.I.C., S.A.
  • n/a
  • Hog Bayou Energy Center
  • Argo Infrastructure Partners LP
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Portfolio of wind and solar assets in Iowa and Illinois
  • ERG S.p.A.
  • $270.00
  • Four refined-products terminals
  • Global Partners LP
  • $212.30
  • Cedar Creek Wind, LLC
  • Clearway Energy LLC
  • $117.00
  • Trinity Environmental Services, L.L.C.
  • Select Water Solutions, Inc.
  • $29.40
  • Water and sewer system in Salem City
  • New Jersey-American Water Company, Inc.
  • $18.00
  • Empire Energy E&P LLC
  • PPP Future Development, Inc.
  • $9.10
  • Via Renewables, Inc.
  • NuRetailco LLC
  • $7.39
  • Lightning Dock Geothermal Hi-01, LLC
  • Zanskar Geothermal & Minerals, Inc.
  • n/a
  • Rx Monitoring Services Inc.
  • Avtron Power Solutions, LLC
  • n/a
  • Commonwealth Projects, LLC
  • Commonwealth Projects, LLC
  • n/a

 

Source S&P Capital IQ as of 7/9/2024 and PCE Proprietary Data

PCE Transactions

Contacts

Michael Rosendahl

New York Office

201-444-6280 Ext 1 |

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Joe Anto

New York Office

407-621-2141 |

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Eric Zaleski

Chicago Office

847-239-2466 |

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Data Assumptions

This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

Glossary

EBIT - Earnings Before Interest and Taxes
EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
LTM - Last Twelve Months
TEV - Total Enterprise Value

Sources:

  1. 1. Petroni, G. “OPEC Keeps Robust Oil-Demand Outlook After Output Policy Move.” The Wall Street Journal, June 21, 2024.
  2. 2. Patterson, S. “The Aging U.S. Power Grid Is About to Get a Jolt.” The Wall Street Journal, June 6, 2024.
  3. 3. Lee, J. “Big Oil Companies Will Just Keep Getting Bigger.” The Wall Street Journal, May 30, 2024.
  4. 4. Hiller, J. & Herrera, S. “Tech Industry Wants to Lock Up Nuclear Power for AI.” The Wall Street Journal, July 1, 2024.
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