The experts within our Energy Services Group maintain ongoing contact with a wide range of knowledgeable sources to stay abreast of the issues and trends that could impact the industry’s M&A climate or otherwise influence our clients’ businesses.  Following are a few of the topics addressed in our most recent Energy Services Review, which is published quarterly.

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ENERGY SERVICES REVIEW (2008: Q1) (View complete report)

M&A Q1 Review and Outlook - Oilfield Services

Overall M&A deal volume in the oilfield services sector declined in the first quarter of 2008 as the global credit markets tightened up and leverage became sparse. A closer look at the data reveals a bifurcated market, with the so-called “mega-deals” (over $1 billion in transaction value) experiencing a substantial slowdown, while the middle market and especially the emerging middle market (deals under $100 million) are continuing a strong deal pace. In Q1 2008, 54 deals were closed in the sector, compared with 88 during the same period a year ago, a 39 percent decline. Total deal value declined to $6.2 billion in Q1 2008, compared to $12.8 billion in Q1 2007, as smaller deals captured a larger share of deal volume. Average valuation multiples also declined, from 16.1x EV/EBITDA in Q1 2007 to 11.6x EV/EBITDA in Q1 2008, as a result of credit market conditions and smaller average deal sizes.

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