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Mike Rosendahl

E: mrosendahl@pcecompanies.com

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Industry Trends

Wind Power Continues to Grow Despite Financial Challenges

The wind power industry faces several challenges that could hinder ' efforts to meet climate goals. Challenges include supply chain delays, design flaws, and higher costs in the offshore wind industry. The European Union is finalizing a legally binding goal to produce 42.5% of energy from renewables by 2030, more than double the current capacity. Despite the challenges, wind energy continues to see growth, solid performance, and attractive prices.1

Dominion Energy Divests Portfolio of Natural Gas Distributors

Dominion Energy plans to sell select natural gas distribution companies to Enbridge, a pipeline operator based in Canada, for $9.4 billion. This move aligns with Dominion's focus on renewable energy and grid improvements. The sale comes amid debates over the future of natural gas and efforts to reduce its use. The deal is set to close by the end of next year, making Enbridge the most significant gas utility business in North America by volume.2

Fuel Prices to 10-Month Highs due to OPEC Production Cuts

Brent crude oil prices have risen above $90 per barrel due to global fuel demand, reduced worries about a U.S. economic downturn, and recent production cuts by Saudi Arabia and Russia. Prices for heavy fuel, derived from denser Russian and Middle Eastern crude oils, have surged even more than crude and gasoline prices, with energy supplier prices escalating approximately 11% in August. This rise affects various sectors, including airlines, trucking, manufacturing, and food delivery, and may contribute to wider consumer inflation.3

Developers are Seeing Record Numbers of Large Battery Installations

Tax incentives introduced by the Inflation Reduction Act have accelerated investment in battery storage, allowing them to be built as stand-alone projects. Predominant in the U.S. battery market states like California, Nevada, Arizona, and Texas,, enable batteries to generate revenue by providing grid stabilization services and energy arbitrage. Texas, in particular, has seen significant battery storage growth, with plans to reach 12,000 to 14,000 megawatts in the next two summers.4

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Magellan Midstream Partners, L.P.
  • ONEOK, Inc. 
  • $18,9145.81
  • Cove Point LNG, LP
  • BHE GT&S, LLC
  • $3,500.00
  • NexTier Oilfield Solutions Inc.
  • Patterson-UTI Energy, Inc. 
  • $2,448.92
  • South Texas Gateway Terminal LLC
  • Gibson Energy Inc. 
  • $1,100.00
  • Ulterra Drilling Technologies, L.P.
  • Patterson-UTI Energy, Inc. 
  • $813.99
  • GE Power Electronics, Inc.
  • AcLeap Power Inc.
  • $505.00
  • Temple II Gas-fired power plant in Texas
  • BKV-BPP Power LLC
  • $460.00
  • Hamilton Holdings II LLC
  • BCPG USA Inc.
  • $260.00
  • OMOG JV LLC
  • Plains All American Pipeline, L.P. 
  • 225.00
  • Spinnaker Oilfield Services LLC
  • RPC, Inc. 
  • 79.00

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Composite Advanced Technologies, Inc
  • Apollo Global Management, Inc.
  • n/a
  • K12 Energy
  • Mars Equity Partners
  • n/a
  • Cogeneration facility of Kalaeloa Partners in Oahu
  • Harbert Power, LLC
  • n/a
  • Port Arthur Liquefaction Holdings, LLC
  • KKR & Co. Inc. 
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Rime Downhole Technologies, LLC
  • Cathedral Energy Services Ltd.
  • $41.00
  • Substantially All Assets of Evoqua Water Technologies LLC
  • Rockwell Medical, Inc.
  • $16.00
  • Battery pack production assets from Romeo Power
  • Mullen Automotive, Inc.
  • $3.50
  • Pecos Slope West Abo Gas Field Located in Chaves County, New Mexico
  • Desert Mountain Energy Corp.
  • $2.00
  • Assets of Rapid Hot
  • Heat Waves Hot Oil Services LLC
  • $1.21
  • Water systems from E.L. Goddard, Inc.
  • West Virginia-American Water Company
  • $0.38
  • Water system assets of Skylonda Mutual Water Company
  • California Water Service Company
  • n/a
  • Assets of Crown Energy Services, Inc.
  • EnergyMark, LLC
  • n/a
  • Tritium3 Renewable Services LLC
  • QE Solar LLC
  • n/a
  • Inertia Engineering and Machine Works, LLC
  • MacLean Power, LLC
  • n/a

 

Source S&P Capital IQ as of 10/11/2023 and PCE Proprietary Data

PCE Transactions

Contacts

Michael Rosendahl

New York Office

201-444-6280 Ext 1 |

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Joe Anto

New York Office

407-621-2141 |

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Eric Zaleski

Chicago Office

847-239-2466 |

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Data Assumptions

This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

Glossary

EBIT - Earnings Before Interest and Taxes
EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
LTM - Last Twelve Months
TEV - Total Enterprise Value

Sources:

  1. 1. Chestney, N. "Wind power industry drifts off course." Reuters, 28 September, 2023.
  2. 2. Blunt, K. "Dominion Sells Natural Gas Utilities to Enbridge for $9.4 Billion." The Wall Street Journal, 5, September, 2023.
  3. 3. Henderson, B. "Fuel Prices Are Soaring. Who Is Feeling the Pinch?" The Wall Street Journal, 14 September, 2023.
  4. 4. Hiller, J. "Giant Batteries Helped the U.S. Power Grid Eke Through Summer.” The Wall Street Journal, 26 September, 2023.
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