GlobalData’s latest report, ‘Quarterly Equipment and Services Deals Review – Q4 2017’, shows that a combined value of $21.2bn in mergers and acquisitions (M&A) were announced in the equipment and services sector in Q4 2017. This was a steep increase from the $10bn in M&A deals announced in the previous quarter.
A year-on-year comparison shows a substantial increase in value in Q4 2017, when compared to Q4 2016’s value of $5bn. During the quarter, 16 M&A deals with values greater than $100m were recorded, together accounting for $20.4bn.
MPLX acquired the refining logistics assets and fuels distribution services of Marathon Petroleum, for a purchase consideration of $8.1bn. The assets are estimated to generate EBITDA of $1bn.
The refining logistics assets consist of integrated tank farm assets that support Marathon Petroleum’s (MPC) refining operations, including approximately 56 million barrels (mmbbl) of storage capacity (crude, finished products and intermediates), 619 tanks, 32 rail and truck racks, and 18 docks and gasoline blenders. The fuels distribution services provide scheduling and marketing services.
Tudor, Pickering, Holt & Co acted as financial advisor to MPC in the transaction. Jefferies acted as financial advisor and Andrews Kurth Kenyon acted as legal advisor to the conflicts committee of MPLX in the transaction.
Equipment and services M&A deal value and count, Q4 2017
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By GlobalDataSource: GlobalData Oil & Gas Deals Analytics
On the volume front, the number of M&A deals increased by 21% from 62 in Q3 2017 to 75 in Q4 2017, of which 19 were cross-border transactions and the remaining 56 were domestic transactions. The Europe, Middle East, and Africa (EMEA) region was the destination of choice for cross-border M&A activity in Q4 2017, recording nine cross-border transactions in the quarter.
Regionally, the Americas led the global M&A market in terms of volume and deal value, with 45 deals worth a combined value of $10.9bn, representing 60% of the global deals and 51% of the total deals value in Q4 2017. EMEA accounted for a 32% share in Q4 2017, comprising 24 acquisitions. The APAC region accounted for six global deals, or 8% of the total recorded in Q4 2017, of which three were cross-border acquisitions and the remaining three were domestic acquisitions.
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