What does Q2’s $65 billion in U.S. upstream M&A tell us about the state of the market?
Deal activity rallied off a ten-year low in Q1 to reach $65 billion in Q2. However, 88 percent of that activity came from one deal — Occidental’s historic $57 billion acquisition of Anadarko. Besides that, the largest Q2 deals focused on the Haynesville, Gulf of Mexico, and onshore U.S. conventional assets with a more modest rebound of $7.6 billion. Please join us as M&A analyst Andrew Dittmar walks through what worked in Q2, what challenges remain in the market, and what we expect to see in the second half of 2019.
Additionally, Q3 already has its first major deal with the $3.2 billion acquisition of Permian and South Texas producer Carrizo by Callon. Hear how this deals fits into 2019’s themes including smaller E&Ps looking to build scale in a fragmented market, navigating the bid/ask spread between buyers and sellers, and how M&A could be used to accelerate the transition to positive free cash flow.
Some of the topics include:
How is Wall Street largely shutting the door on new capital for public E&Ps affecting deals?
Where else are companies looking to raise capital as they work towards free cash flow?
What moves are private capital providers making to take advantage of market opportunities?
Who is making moves in a still-hot market for oil and gas royalty assets?
Why does corporate M&A remain scarce among E&Ps despite having many factors to recommend it?
What does the Callon Petroleum acquisition of Carrizo Oil & Gas mean for the M&A market and navigating the current low-growth Wall Street?
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Andrew Dittmar is a Senior M&A Analyst on the Drillinginfo Market Research Team. Andrew specializes in deal analysis, research and valuations for upstream assets. He focuses largely on placing individual deals into context around broader industry trends and outlooks, and has been quoted by Reuters, CNBC, the Wall Street Journal, Houston Chronical and other media outlets. Andrew holds a BBA in Finance from Texas A&M University and a JD from The University of Texas School of Law.