Oil and gas dealmaking is concentrating around a small number of players who capture outsized returns, driven by consolidation among frequent buyers, a new report found.
The top 20 acquirers in the last 10 years accounted for 53% of total deal value, and companies that complete at least one acquisition per year now generate total shareholder returns 130% higher than peers that do not complete any deals — more than double the performance gap seen a decade ago, research by the consulting firm Bain & Co found.
Mergers tend to allow companies to capture scale and reduce unit costs through operational efficiencies and consolidated infrastructure, savings that have become more important now that oil prices have retreated from their 2022 peak.