Merger and acquisition activity among energy and power companies has stalled in the first half of 2022.
Why it matters: 2021 was a blockbuster year across industries and deal scopes, but 2022 may not live up to its newly set bar.
By the numbers: For those of you who got used to deal valuations only going up and to the right over the past few years, today's chart shows 2022 figures moving to the left, illustrating the decrease in deal valuation.
- Overall M&A activity from Jan. 1 to June 28 fell 22% to nearly $205 billion from just over $261 billion over the same period in 2021, Refinitiv data provided exclusively to Axios shows.
- Oil and gas M&A deals fell 14% to just over $98 billion in H1 2022 from $114 billion in H1 2021.
- Power M&A deals fell roughly 21% to roughly $60 billion from just under $77 billion in 2021.
- The number of deals also fell, roughly 19% across the category, indicating there are fewer deals getting down at lower valuations.
💭 Our thought bubble: Project costs for energy and power developers has increased throughout the first half even as public markets have faltered, leaving room for additional M&A activity in the second half.