Q3 utility deal value surges

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In Q3 2012, power and utilities companies saw the highest level of merger and acquisition deal activity since the same period in 2011, according to PwC.

"This quarter we saw the highest level of deal activity of transactions worth over $50 million since the third quarter of 2011, as companies look to scale operations to drive revenues," said Jeremy Fago, PwC's U.S. power and utilities valuation services leader. "Consistent with our earlier reports, we continue to see increased generation asset activity, both fossil and renewable."

In the third quarter of 2012, there were six announced transactions with values greater than $50 million totaling $4.9 billion. A surge in deal value was driven by one $4.2 billion transaction in the merchant energy space, which pushed average deal value in the third quarter of 2012 to $826 million, compared to $334 million in the second quarter.

PwC expects to see continuing activity in the merchant energy space due to environmental compliance pressures, load growth considerations and the current price of natural gas.

For more:
- see the report

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