Increase in Oil & Gas Private Equity-Backed Deals in the US 2006 - 2014 YTD

by Emily Forbes

  • 26 Sep 2014
  • PE
  • NR

Preqin’s Buyout Deals Analyst shows that since 2006, there have been 510 deals in the US in the oil & gas industry, with an aggregate value of $102bn. Since 2009, the number of deals has increased year-on-year until 2013, which stayed at the same level as 2012. This year is set to be another record-breaking year in terms of deal volume, with 74 deals completed already, in comparison to 78 for the whole of 2013. However, as can be seen from the chart below, the aggregate value of deals completed in the industry appears to drop off after 2012, with only $11.4bn and $10.5bn of completed deals in 2013 and 2014 YTD respectively, compared to $18.3bn in 2012. 

Leveraged buyout deals (LBOs) and growth capital deals were the most prominent type of private equity-backed buyout transactions for oil & gas deals in the US in 2013, each accounting for 35% of all deals. However, LBOs only contributed 20% of the aggregate deal value, while growth capital deals contributed 38%. These figures remain the same for LBOs in 2014 YTD, but growth capital deals appear to have decreased, contributing 24% of all deals and 34% of the aggregate value. With 27 add-on deals valued at a total of $4bn recorded in the oil & gas industry in the US, 2014 has seen a 10 percentage point increase in the number of deals and a two percentage point increase in the aggregate value of these transactions when compared to 2013. 

In comparison to other locations across the world, the US dominates other regions in regards to private equity-backed buyout deals in the oil & gas industry, accounting for 57% of the deal volume and 65% of the aggregate deal value from 2006-2014 YTD. The proportion of the number of deals in the US has stayed within a fairly narrow band, however, the aggregate deal value proportions have fluctuated from as high as 88% of the global total in 2006 to as low as 28% in 2008. The next most active regions in the oil & gas industry were the UK and Canada, which accounted for 9% and 7% of deals since 2006 respectively, significantly lower than the US. The top three US states in terms of both number of deals and aggregate value were, in order, Texas, Oklahoma and Colorado.

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