GlobalData’s latest report, ‘Monthly Upstream Capital Raising Review – January 2018’, shows that global raising activity in the upstream sector totalled $8.9bn in January 2018.

This was a decrease of 49% from the $17.6bn in capital raising deals announced in the previous month. On the volume front, the number of capital deals decreased by 24% from 55 in December 2017 to 42 in January 2018.

A year-on-year comparison shows a decline of 25% in deal value in January 2018, when compared to January 2017’s value of $11.8bn. The month recorded 15 capital raising deals with values greater than $100m, together accounting for $8.5bn.

Capital raising through debt offerings witnessed a substantial decrease in deal value, recording $5.5bn in January 2018, compared with $14.5bn in December 2017. Capital raising through equity offerings registered a 21% increase in deal value, with $1.1m in January 2018, compared with $868.1m in December 2017. Seven private equity/venture capital deals, with a combined value of $2.3bn, were recorded in January 2018.

Upstream capital raising deal value and count, January 2018

Source: GlobalData Oil & Gas Deals Analytics

Petroleo Brasileiro’s public offering of 5.75% senior unsecured notes, due February 1, 2029, for gross proceeds of $2bn, was one of the top deals registered in January 2018. The notes were priced at 98.4% of the principal amount to yield 5.95% at maturity. Interest on the notes will be payable semi-annually on February 1 and August 1 of each year, beginning on August 1, 2018.

The company intends to use the proceeds from the offering to fund the redemption of its existing 3% global notes due January 2019, 7.875% global notes due March 2019, and 3.25% global notes due April 2019; to repay other existing debt; and for general corporate purposes.

Regionally, the Americas led the global capital raising market in terms of volume and deal value, with 28 deals worth a combined value of $7.1bn in January 2018. Europe, the Middle East and Africa (EMEA) registered eight deals representing a combined value of $1.1bn; while Asia-Pacific recorded six capital raising deals with a combined value of $704.1m in January 2018.