North American power deals: Mergers & acquisitions report

Q1 2019

Canadian dealmakers are featured in three of the top 10 North American power and utilities deals in the first quarter of 2019. ENMAX Corp. was the quarter’s top dealmaker with its US$1.3-billion acquisition of Emera Maine, a Maine-based electricity transmission and distribution company.

Other Canadian deals included Columbia Power Corp.’s US$754-million acquisition of a 51% interest in the Waneta Expansion hydroelectric project from Fortis Inc. and Brookfield Renewable Partners LP's US$296-million divestiture of a 25% interest in a 413-megawatt hydroelectric portfolio.

Across all of North America, deal volume remained strong in the first quarter of 2019, driven by asset deals, particularly wind, solar and inbound investments. Overall, wind energy deals represented 20% of total deal value (US$1.6 billion for the quarter).

On a value basis, Q1 2019 was the weakest first quarter in the past four years, with deal value declining from Q4 2018 and in comparison to Q1 2018. Much of this value decline had to do with the absence of any mega deals for the third consecutive quarter. In the power and utilities sector, investors continue to look to the deal market for growth opportunities and to optimize portfolios.

"As we look forward, we continue to expect asset deals, in particular on the renewable side, to drive activity in 2019. Portfolio rationalization, continued decarbonization efforts and expiring renewable tax incentives are influencing transaction behaviour. We also expect Canadian P&U players to feature heavily in the North American deals market."

Ken Goodwin, National Deals Leader, Power & Utilities

Q1 Key trends and highlights

 

Total deal value declined to $7.9 billion in Q1 2019, making it the lowest-value quarter since Q2 2017, and the lowest Q1 since Q1 2015.

 

  • 16 deals were announced in Q1, representing continued strong deal activity by volume.

  • Strategic deals drove the deal value and volume, accounting for a 91% and 81% respectively.

 

Inbound activity remained strong, accounting for 36% of deal value and 25% of deal volume.

 

 

Asset deals accounted for 64% of deal value in the quarter and 75% of deal volume.

 

 

No mega deal was announced this quarter.

 

Power and Utilities quarterly deals insights

Contact us

Helen Bremner

Helen Bremner

Partner, National Industry Leader, Power and Utilities, PwC Canada

Tel: +1 403 509 7404

Eric Clarke

Eric Clarke

Partner, PwC Canada

Tel: +1 416 687 8801

Ken Goodwin

Ken Goodwin

Partner, National Valuations Leader, PwC Canada

Tel: +1 416 814 5760

Brian Poth

Brian Poth

National Energy, Utilities, Mining and Industrial Manufacturing & Automotive Consulting Leader, PwC Canada

Tel: +1 416 687 8522

James McLean

James McLean

Partner, Operations, PwC Canada

Tel: +1 403 509 7530

James Strapp

James Strapp

Partner, Power & utilities, PwC Canada

Tel: +1 416 863 1133

Rebecca Chan

Rebecca Chan

Partner, Tax, PwC Canada

Tel: +1 416 365 8831

Follow PwC Canada