The energy and power market is caught in the center of numerous global headwinds that could sink M&A deals in 2020, according to a Merrill Insight™ poll conducted by Merrill Corporation, a leading global SaaS provider for participants in the M&A lifecycle.
Dealmakers were split relatively even when ranking the factors most likely to sink energy and power deals in 2020, though demand weakness (23%) edged out political uncertainty (22%), commodity markets (22%) and recession concerns (20%), according to the poll, which included more than 170 respondents from the Americas and Europe, the Middle East and Africa (EMEA). Just 13% saw tariff wars/protectionism as a factor.
Despite these concerns, dealmakers expect continued growth in alternative energy deals, which accounted for 42% of all energy deals in 2019 – a 6% uptick from 2018. When asked which areas they expect to see the most alternative energy investment in 2020, 38% of respondents cited energy storage as the largest opportunity area, ahead of solar installments (24%), grid technology (15%), alternative fuels (14%), and wind projects (10%).
“The shift toward renewable energy is driving companies to cultivate new partnerships, and as alternative sources become more common, there will be a greater need to expand and commercialize its storage,” said Rusty Wiley, Chief Executive Officer of Merrill Corporation. “Renewed interest in hydrogen, impressive advances in second generation sources, and growing private equity interest in solar are also fueling interest for the sector.”
For more information on the energy and power M&A outlook, please see the Merrill Insight™ replay. The poll results are based on responses from global M&A professionals in the Americas and Europe, the Middle East and Africa.
About Merrill Corporation
Merrill Corporation is a leading SaaS technology provider for participants in the M&A lifecycle. The company’s platform, DatasiteOne, powers secure, intelligent due diligence, asset marketing and enterprise collaboration for thousands of deals globally. To learn more, visit www.merrillcorp.com