Mergers and acquisitions in the renewable energy field, according to a new survey, have been remarkably strong in the past 18 months, and are expected to “dramatically increase” in the next year.
The survey, commissioned by R?dl & Partner and executed by mergermarket in May, found that in 2009, 228 deals were announced at a total value of 49.7 billion euros ($66.5 billion)–comparable to activity in the M&A heyday of 2007; the first two quarters of 2010 were also very active.
One hundred senior M&A professionals all over the world who are directly involved in the renewable energy sector were interviewed for the survey. Results included the finding that 78% expect M&A activity to increase over the next year, with 41% of respondents confident that utility companies will be “very active acquirers” of assets, as renewables attempt to reach parity with conventional energy sources. This suggests that the buy-side aspect is no longer the preserve of niche investors.
The single biggest obstacle to making deals has been access to financing, according to 70% of respondents, with 67% expecting an increase in private equity investment in the months ahead.