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Oil and gas M&A set for revival
With oil and gas companies' balance sheets in better shape and some prime assets back on the market, corporate activity is set to accelerate, writes James Gavin
THE OIL and gas mergers and acquisition (M&A) market is showing signs of life after a year of hibernation. While frozen capital markets and depressed energy prices during the recession caused a slow-down in M&A activity, many companies embarked on efficiency drives or simply held on to their cash. But the combination of cheap asset valuations, higher and more stable energy prices, and improving balance sheets is stimulating corporate deals. In late 2009, ExxonMobil launched a $41bn take-over of US shale-gas specialist XTO (see p4). Shortly afterwards, Total agreed a $2.25bn joint venture with the US' biggest gas producer Chesapeake Energy, in Texas' Barnett Shale. In exchange for a 25% share of Chesapeake's upstream Barnett Shale assets, the French company will pay $0.8bn in cash and supply a further $1.45bn ...Click here to continue reading Oil and gas M&A set for revival
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