Thu, Sep 27, 2012

Energy Industry Report: Energy Perspectives - September 2012

The energy market demonstrated two distinct trends in September: apprehension regarding 2013 capital spending and continued strength in M&A activity.
Download the Report

Although 2012 E&P budgets supported strong capital expenditures, as we enter the beginning of the E&P 2013 budgeting cycle, continued growth in capital spending may be facing some headwinds. The global demand outlook for 2013 is ambiguous at best. The slow growth of the U.S. economy, election year, continued discussions of environmental regulation on fracing, tension in the Middle East, Europe’s continuing fiscal issues and slowing growth in Asia will factor into 2013 spending plans. In addition, it is difficult to project the effect of favorable gas pricing hedges rolling off through the balance of 2012 and through 2013 on capital spending budgets. We will continue to evaluate E&P capital spending information through the balance of this year. At this juncture, we expect E&P capital spending to mirror the current rig count activity for YTD 2012 where dry and wet gas markets will likely continue to see cutbacks with capital reallocated to oily markets.

M&A activity has remained strong. NOV has made approximately $4 billion of acquisitions over the past 6 months. Additionally, in September we have tracked 8 announced transitions, including Waste Connections (NYSE: WCN) purchase of R360 Environmental Services, Inc. for $1.3 billion.

Corporate Finance and Restructuring

M&A advisory, restructuring and insolvency, debt advisory, strategic alternatives, transaction diligence and independent financial opinions.

Mergers and Acquisitions (M&A) Advisory

Kroll’s investment banking practice has extensive experience in M&A deal strategy and structuring, capital raising, transaction advisory services and financial sponsor coverage.

Financial Sponsors Group

Dedicated coverage and access to M&A deal-flow for financial sponsors.

Private Capital Markets – Debt Advisory

Kroll has extensive experience raising capital for middle-market companies to support a wide range of transactions.

Distressed M&A and Special Situations

Kroll professionals have advised hundreds of companies, investors and other stakeholders at all stages of distressed transactions and special situations.