By: Duane Donner
As reported in our August Oilfield Services (OFS) Newsletter, Energy M&A sentiment is increasing; we have seen a slew of transactions announced in recent weeks. These transactions, which were initiated during a period of higher uncertainty, are now being closed with guarded optimism. This recent optimism is being manifested by the sustained and steady increase in rig counts, oilfield activity, and oil prices, but the underlying driver of these results is a combination of a number of other positive factors. These factors include a change in OPEC’s position and resilient demand fundamentals. With these factors at play, operating companies and investors alike are beginning to enter the market with the intent to place their bets or double down.
Founders is actively advising on buy-side and sell-side processes as oil and gas industry constituents are aggressively positioning themselves to ride the cycle back up. One common thread among our most recent engagements has been oilfield creativity. Transactions ranging from mergers and recapitalizations to growth equity and private debt are being pursued by oilfield entrepreneurs, Texas-based family offices, and oilfield focused private equity firms to take advantage of the current market opportunity.
In the October Edition of our Oilfield Services Newsletter, we further discuss underlying reasons for the sharp uptick in Energy M&A sentiment along with what transactions are currently happening and available in the market at this time. We also discuss why now is the time to be thinking about making strategic moves to grow and evolve oilfield services businesses.
Below is an example OFS company’s market share and revenue through the cycle.
Founders Investment Banking (Founders) is a merger, acquisition & strategic advisory firm serving middle-market companies. Founders’ focus is on oil and gas, SaaS/software, industrials, internet, digital media and industrial technology companies located nationwide, as well as companies based in the Southeast across a variety of industries. Founders’ skilled professionals, proven expertise and process-based solutions help companies access growth capital, make acquisitions, and/or prepare for and execute liquidity events to achieve specific financial goals. In order to provide securities-related services discussed herein, certain principals of Founders are licensed with M&A Securities Group, Inc. or Founders M&A Advisory, LLC, both members FINRA & SiPC. M&A Securities Group and Founders are unaffiliated entities. Founders M&A Advisory is a wholly owned subsidiary of Founders. For more information, visit www.foundersib.com.