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M&A at $60 – the buying window opens
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Report summary
We said in December that M&A would not bounce back until there was consensus on the shape and timing of oil price recovery. It seems we are reaching this point, with growing alignment – among companies, investors, lenders and analysts – that prices will steadily recover over the next few years, to average US$80-90/bbl longer-term. In this note, we look at how the M&A market might evolve in this consensus world, the implications for deal valuation, and the downside risks.
Table of contents
- Executive Summary
- The story so far
- What happens next ?
-
The consensus scenario – now is the time to buy
- What does this mean for M&A?
-
The bear scenario – wait and see
- What does this mean for M&A?
-
Who are the potential buyers?
- The big IOCs
- The Asian NOCs
- Private Equity (PE)
- Influx of PE money is not without risk for investors
- or the wider sector
-
Appendix
- 1. Implied Long-term Oil Price
- 3. PE funding examples
Tables and charts
This report includes 5 images and tables including:
- Oil price, Implied Long Term Oil Price, and deal activity
- Sector market performance 2014/15
- LT Brent price implied in market EV
- Gearing ratio vs. WoodMac corporate cash flow breakeven estimate 2016/2017
- 2. Key PE transactions October 2014 to date
What's included
This report contains:
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