Energy and Mining Strong Rebound 2017

Australia’s Energy and Mining M&A saw a strong rebound in 2017.

In the first three quarters, Australia’s energy M&A has recorded a value of US$17.9bn, 6 times up compared to the same period last year(US$2.5bn) and already exceeded the number of 2016 whole year. The top deal in Q1-Q3 is the sale of Endeavour Energy by Government of New South Wales, deal value at US$5.6bn.

Compared to Q1-Q3 2016(US$1.6bn), Australia’s mining M&A recorded US$4.8bn this year and almost double 2016’s who year figures. The top deal so far in 2017 goes to Rio Tinto selling its Coal & Allied Industries to Yancoal Australia, valued at US$24.5bn. Yancoal Australia is also the bidder of the second largest mining M&A deal in Australia: Warkworth Joint Venture sold by Mitsubishi Development at US$230m.

Mergermarket’s financial research Adam Orlando said Australia’s mining sector is expected to continue its rebound in 4Q17 in Australia.

“With the expected upswing in prices for tech-metals commodities such as nickel, as well as the growing lithium market, signs of renewed growth are showing. In addition the rebounding coal price and the approval of Adani’s massive Carmichael mine are further signs of this activity. Though activity has picked up, deal values across the board have dropped.

Similarly, the energy sector is showing further signs of its recovery and this is not expected to change in 4Q17. After years of weak demand and low prices, companies are now feeling confident to make strategic decisions and this should lead to further investment in 4Q17 and beyond.”

Source: QMEB