John S. Herold Finds Worldwide 1Q Power M&A Transactions Total $26.5 Billion

Electric utility worldwide merger and acquisition transactions totaled $26.5 billion in the first quarter of 2000, a 61% increase over the aggregate total of transactions recorded in the first quarter of 1999, according to statistics compiled by John S. Herold, Inc., a global energy research firm. Herold, which tracks all energy transactions of $10 million or more, computed an average deal size of $1.2 billion, by far larger than the average deal size in any other sector of the global energy industry.

Driving the results were mergers of integrated utilities, the aggregate value of which jumped nearly $11 billion in the first quarter of 2000 compared with the first quarter of 1999. Generation transactions declined both in number and value, due primarily to a drop in U.S. state mandated divestitures. Activity in the electric transmission and distribution segment of the power industry was quiet.

Herold noted that international power companies accounted for 55% of worldwide transactions, a reversal of a longstanding trend. European buyers drove the cross-border activity. In the U.S. market, Herold found evidence that prices for nuclear generation facilities may be on the rebound.

The John S. Herold M&A Transaction Review: Power, First Quarter 2000 Analysis is based on the research company's comprehensive database containing detailed information on all significant transactions in the worldwide energy industry. For information about the Herold M&A database and related publications, contact John Cannon at (203) 359-4339 or jcannon@herold.com.

Edited by Stephen Heiser