You know you’re on to a good thing if the markets smile when you announce a deal. The conventional reaction is for the stock to take a knock. But that’s not been the case lately in the power and utilities sector.
Deals are firmly back on the table in the US, for example, and Wall Street has been smiling. Companies are diversifying their businesses and seeking to get a good balance between regulated and non-regulated earnings.
That’s not the only thing that’s changing. In Europe network divestment is moving apace as companies respond to regulatory moves and strengthen their balance sheet in preparation for major capital project investment.
We’re seeing new buyers coming into the sector. For example, the influence of international Chinese investors is important and their influence will grow. The shape of the sector is also changing as consolidation remains a strong force. And convergence between sectors can’t be ruled out as companies address fuel supply issues, the implications of smarter grids and new uses for electricity.
We help you do better deals and create value through mergers, acquisitions, disposals, restructuring and joint ventures.
Before and during the deal, we work with you to develop the right strategy, identify the right target, negotiate terms and finance and get the best deal structure. We can help execute the deal seamlessly and identify issues and points of negotiation and value.
After the deal, we’re on hand to implement changes to deliver synergies and improvements. We’re able to help you manage the post-deal integration process, carve out non-core assets, and make changes to realise improvements in long-term performance.
Joint ventures and strategic alliances are becoming increasingly important in the utilities sector. We can help with a detailed examination of risks and how the structure can reflect the fact that different parties will be contributing different components to the venture.