Power M&A Activity Hits Record High in 2007

Merger and acquisitions (M&A) activity in the power sector soared to record levels in 2007, industry analyst PricewaterhouseCoopers (PwC) says.

The firm's annual review of M&A activity in the power industry, Power Deals, shows a 25 percent increase on 2006.

Total worldwide power deals were worth US$372.5bn, nearly nine times the US$43bn recorded four years ago.

PwC says global economic conditions had little effect on activity, as 57 percent of all deals came in the second half of the year.

PwC global utilities leader Manfred Wiegand says momentum in the sector was not noticeably hit by the credit crunch.

"We will eventually see some impact but many corporate players have cash to invest," Wiegand says.

"Investor appetite for the sector is likely to remain relatively favourable and the basic imperatives of non-organic growth and the need to secure and diversify fuel sources in an era of scarce energy cannot be ignored."

By Elizabeth Clifford-Marsh