Basedon merger-and-acquisition activity during the first three months of 2016, it looksto be another active year of deals in the energy sector. The first quarter saw itsbiggest deals representative of trends from the prior year, including shale pipelineacquisitions, Canadian holding companies acquiring regulated U.S. power businessesand large, diversified East Coast utility companies acquiring regulated gas utilityand midstream companies.
's deal to acquireColumbia Pipeline Group Inc.,at an announced transaction value of $12.09billion, represents the first quarter of 2016's biggest energy deal.Under the terms of the all-cash deal, Columbia shareholders will receive $25.50per common share, an 11% premium to its closing stock price March 16. The companiesannounced the transactionMarch 17, saying TransCanada's desire for access to Appalachian shale was its motivation.
advisedTransCanada on the transaction, while GoldmanSachs & Co. and LazardFreres & Co. LLC advised Columbia Pipeline.
Witha transaction value of $11.33 billion, the first quarter of 2016's biggest power-relateddeal was the acquisitionof ITC Holdings Corp.by Canada-headquartered Fortis Inc.,announced Feb. 9. Fortisis offering $22.57 in cash and 0.7520 Fortis shares for every ITC share. The totalconsideration of $44.90 per share represents a 33% premium to ITC's unaffected closingshare price Nov. 27, 2015, a few days before the independent transmission companyconfirmed it was consideringa strategic review.
GoldmanSachs and Scotia Capital Inc.are advising Fortis on the deal. BarclaysCapital Inc., Morgan Stanley& Co. LLC and Lazard Freres are serving as deal advisers for ITC.
Continuingin the footsteps of other East Coast electric utility giants and pipeline assets,Dominion Resources Inc.on Feb. 1 announced anall-cash deal, witha transaction value of $5.88 billion, to acquire Questar Corp. Under that transaction, Questar shareholderswill receive $25 per share, which represents a 30% premium. Upon announcing theacquisition, Dominion management toutedSalt Lake City-headquartered Questar's role as a gas hub in the Western U.S., andsaid its assets would make a useful portfolio of dropdown assets for master limitedpartnership affiliate Dominion MidstreamPartners LP.
and advised Dominionon the deal, while Goldman Sachs advised Questar.
As ofMarch 31, Goldman Sachs topped SNL Energy's rankings by transaction value, withthree deals totaling $29.30 billion. Lazard Freres was close behind, advising onthree deals totaling $26.72 billion. By transaction value, Morgan Stanley rankedthird, with four deals and a total transaction value of $15.83 billion, but thatput Morgan Stanley at the top of the rankings by number of transactions. RBC CapitalMarkets also advised on four deals during first-quarter 2016, but had a total transactionvalue of $9.62 billion. In 2015, MorganStanley topped all other banks in energy M&A financial advising,with Goldman Sachs ranking fifth and Lazard Freres ranking seventh.
Severallegal advisers to TransCanada on its Columbia Pipeline acquisition are, as of thefirst quarter of 2016, tied for top ranking: Blake Cassels & Graydon LLP, MayerBrown LLP and Osler Hoskin & Harcourt LLP, each with a transaction value of$12.09 billion. Sullivan & Cromwell LLP, serving as an adviser to Columbia Pipeline,is also tied for the top spot on the ranking. Legal advisers to Dominion and Questaralso rank on list, with Davies Ward Phillips & Vineberg LLP, Jones Day, SimpsonThacher & Bartlett LLP and White & Case LLP tied for fifth with a totaltransaction value of $11.33 billion.
SNL Energy is anoffering of S&P Global Market Intelligence.