Sector watch

A strong focus on decarbonisation and digital innovation continue to drive M&A in both the broader and mid-market.

Energy, mining and utilities (EMU) was the top sector in 1H23, accounting for 78% of deal value. Even factoring out the AU$30bn Newcrest Mining deal, the EMU space still accounted for 50% of values.

Australia’s energy space is undergoing a transformative shift towards decarbonisation and the expansion of renewables, with solar and wind power leading the way. The rapid growth of utility-scale renewables projects, coupled with declining costs and supportive government policies, has propelled the transition and seen rising investment in this industry in both the broader and mid-market.

Distress in the energy and mining industry could also be a theme going forward as these companies explore M&A as an avenue to financial recovery or restructuring operations more broadly.

As the rapid adoption of digital advancements disrupts and transforms traditional business models, dealmakers are feverishly turning to tech M&A to bolster operations and secure future growth. Technology, media and telecommunications (TMT) accounted for 25% of total deals in 1H23 and will likely see greater activity going forward as Australia’s flourishing and innovative startup scene continues to captivate investors.

The rapid growth of utility-scale renewables projects, coupled with declining costs and supportive government policies, has propelled the transition and rising investment in EMU in both the broader and mid-market.