Nuclear Energy Quarterly Deals Analysis: M&A and Investment Trends - Q3 2010

Nuclear Energy Quarterly Deals Analysis: M&A and Investment Trends - Q3 2010

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GlobalData's "Nuclear Energy Quarterly Deals Analysis M&A and Investment Trends - Q3 2010" report is an essential source of data and trend analysis on the Mergers and Acquisitions (M&A) and financings in the nuclear energy market. The report provides detailed information on M&As, equity and debt offerings, Private Equity and Venture Capital (PE/VC) and partnership transactions registered in the nuclear energy industry in Q3 2010. The report provides detailed comparative data on the number of deals and their value in the last five quarters, subdivided by deal types, segments and geographies. Additionally, the report provides information on the top PE, VC and advisory firms in the nuclear energy industry.

Data presented in this report is derived from GlobalData's proprietary in-house Nuclear Energy eTrack deals database and primary and secondary research.

M&A Activity Declined In The Nuclear Energy Market In Q3 2010

M&As and asset transactions, which include changes in the ownership and control of companies or assets (GlobalData considers this value as not a new investment into the market), in the nuclear energy industry witnessed a decrease in the number of deals, reporting 17 deals in Q3 2010 compared to 21 deals in Q2 2010. All the regions, except Asia-Pacific, merely shown any interest in M&A activity, which led to a decrease in the number of deals in Q3 2010. However, deal value reported an increase from $1.1 billion in Q2 2010 to $1.6 billion in Q3 2010.

The M&A activity in the nuclear energy market was predominantly driven by the Asia Pacific companies. Australian companies are the major contributors with four deals out of total five M&A deals registered in the Asia Pacific region in Q3 2010. Despite of Australia's traditional de-facto ban against nuclear energy, the nuclear energy industry has witnessed an increase in M&As and asset transactions, as Australia being the important source of uranium.

According to Uma Bhanu Kondury, Analyst at GlobalData, "Nuclear power's potential in reducing greenhouse gas emissions has been the chief reason for the increased interest in uranium mining activities in Australia which subsequently led to higher volume of investments in the country."

New Investments In The Nuclear Energy Industry Declined In Q3 2010

Investments in nuclear energy companies, including new investments through equity/debt offerings and financings by PE/VC firms, decreased by 43% from $15.4 billion in Q2 2010 to $8.8 billion in Q3 2010. However, the number of deals registered an increase with 57 deals in Q3 2010 compared to 46 deals in Q2 2010.

New investments in the nuclear energy market were majorly recorded in the United States, reporting 40 deals $7.2 billion in Q3 2010, followed by Asia Pacific region with 13 deals worth $547.4 million in Q2 2010.

GlobalData expects that "New investments in the Middle East and Africa are expected to mark their presence in the nuclear energy regime as countries such as Bahrain, Jordan, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates have expressed interest in having nuclear energy program."

Decreased Financing Through Equity Offerings In Q3 2010

Global equity offerings, including Initial Public Offerings (IPOs), secondary offerings, and Private Investment in Public Equities (PIPEs) witnessed a significant decrease of 92% in the financing, reporting $451.8 million in Q3 2010 compared to $5.7 billion in Q2 2010. The huge difference in deal value was due to some of the big ticket deals in Q2 2010: PPL's public offerings of $2.5 billion and $1.2 billion; and Datang International Power Generation's private placement of $1.2 billion. However, the number of equity offering deals registered a marginal increase from 32 deals in Q2 2010 to 36 deals in Q3 2010. Out of the total 36 deals, PIPE accounted for 83% of the total number of deals, reporting 30 deals in Q3 2010.

In addition, debt offerings, including public and private debt placements, by nuclear energy companies have witnessed a substantial increase of 62% in the number of deals, reporting 21 deals in Q3 2010 compared to 13 deals in Q2 2010. Inversely, deal value decreased from $9.7 billion in Q2 2010 to $8.3 billion in Q3 2010.

North America and Asia-Pacific, The Key Focus Areas In Q3 2010

The North American market, which is the key investment market, bounced back with 45 deals in Q3 2010 compared to 38 deals in Q2 2010. However, investments decreased from $11.1 billion in Q2 2010 to $7.2 billion in Q3 2010.

Following the Asia Pacific's movement towards change in the energy mix, the nuclear energy industry witnessed an increase in the number of deals and investments, reporting 28 deals worth $2.2 billion in Q2 2010 compared to 23 deals worth $2.1 billion in Q3 2010. Countries like China, Korea and India will drive the investments in the nuclear energy development, as the renewed interest in building new nuclear reactors in United States has stalled due to various legislative and regulatory issues.

Additionally, the European region witnessed a decrease of 63% in the number of deals and 69% in deal value, reporting three deals worth $1 billion in Q3 2010 compared to eight deals worth $3.3 billion in Q2 2010. In the Middle East and Africa region, primarily Egypt is expected to drive the nuclear energy investments as the country is expected to resume its suspended nuclear program after the realization of the fact that the current gas reserves are expected to be sufficient only for another 30 years. Additionally, the Egyptian government planned to increase energy sources by constructing eight nuclear power plants, each costing more than $4 billion.

According to Uma Bhanu Kondury, Analyst at GlobalData, "The support for new nuclear power projects by the Obama government has resulted in increased investments in the US while China's imposing target of adding up nuclear power capacity has been the contributing factor for the higher volume of investments in the Asia-Pacific region". For more details, please vist http://www.reportreserve.com/reportdet.php?company=GlobalData&reportid=13074

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