It’s a Hungry Market


The broader capital markets are healthy, evidenced by intense investor demand. We continue to observe a strong desire to deploy capital and consummate acquisitions, driven by the availability of inexpensive financing options and surplus of capital—market conditions often compared to the last peak M&A cycle in 2007.  A driving force in valuations, which was absent from the last cycle, is a persistent supply shortage of quality opportunities to deploy capital.  Investors have considerable buying power and are responding in kind using acquisitions to accelerate growth.  It’s a hungry market.
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Breakout Together – Consolidating in a Time of a Shakeup


In the past year, leading oil and gas companies across the supply chain have announced plans to significantly reorganize, signaling a broader industry trend of consolidation. For instance, Hercules Offshore, a major drilling services provider that once had a market capitalization of over a billion dollars, recently filed for Chapter 11 bankruptcy. In April 2015, Shell announced its plan to acquire BG Group for $70 billion. To better understand the impact of lower commodity prices and implications to distressed players it is important to analyze trends in two common exit strategies: bankruptcy and M&A.
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Joint Ventures in Oil and Gas – Using Automation to Tame JIBs


John Donne once wrote that no man is an island. Well the same is true for oil and gas companies. In tough economic times or periods when government regulations and other factors increase risk, upstream energy providers and midstream producers are banding together to optimize use of downstream energy delivery assets like the pipeline to reduce capital expenditure and mitigate risk. Joint ventures are easier to unbundle than organizational mergers, and they help sidestep antitrust concerns. While some of those joint ventures are highly successful, many fail often due to challenges with billing that affect cash flow. For a joint venture to be successful, the partners need highly efficient accounting systems that can process Joint Interest Billing (JIB) quickly, fairly, and efficiently.
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Oil and Gas Mergers, Divestitures, and Acquisitions: Current Trends


Market disruption often causes an increase in merger, divestiture, and acquisition (“MDA”) activity. The Energy Complex is no exception, and the steep decline in commodity prices during the last twelve months means increased deal activity. More is expected. This paper examines the buyers, the sellers, and the critical valuation issues involved. It also sketches out a path ahead for MDA activity in this industry.
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