deals and invest in business development to find opportunities ahead of the pack and
outside traditional auction processes.
Sourcing a deal will become a critical choke point. Companies with superior management, solid balance sheets and a record of lowering a driller’s cost per barrel draw multiple
bidders in competitive auctions, driving up the price and therefore, all else equal, lowering
the acquirer’s returns. We have observed competitive bidding processes where strong
companies are awarded large premiums.
Going forward, we see organic growth, in-house technology development and operational improvements as taking center stage, as roll-ups and bolt-ons will be harder to
Over the next 12-24 months, we also expect private equity investors will develop deeper
subject-matter expertise in the various sub-segments of the oilfield service industry to
stay ahead of competitors and pick winning investment strategies. To be successful,
private equity shops will need a deeper bench of expertise across the deal continuum,
starting with business development and deal sourcing, extending to deep diligence and
deal execution, and concluding with operational improvements and distinctive commercial strategies to run their businesses.
ABOUT THE AUTHORS
Raul J. Coral serves as Director – Deals Strategy at PwC. Coral is a leader of the Houston
Deals Strategy team where he serves financial and strategic investors across different
questions on growth strategy, commercial diligence and M&A. He focuses on service
and manufacturing oriented businesses working for upstream, midstream and down-stream players. He has served as an advisor in both large and small M&A transactions
in energy and industrials. Coral received his Bachelor and Master degrees in engineering
from the Massachusetts Institute of Technology, and his MBA from Wharton at the
University of Pennsylvania. He previously worked at McKinsey & Company, IHS, and
Kyle West is a Director in the Transaction Services practice based in Houston. He specializes in financial, economic and accounting analyses involving complex business
transactions. His experience includes a range of M&A issues including financial due
diligence, value drivers, purchase agreement negotiation, and sell-side diligence. He
transaction experience spans oilfield services, downstream, midstream, and upstream
transactions. He received his Bachelor of Business Administration in Accountancy from
the University of Notre Dame and his MBA from the University of Texas. He is also a
Certified Public Accountant in Texas.
Rob McCeney is a Partner in the Transaction Services practice based in Houston. He
specializes in providing acquisition services in the oil and gas industries and works closely
with financial sponsors. McCeney leads buy and sell-side financial due diligence services,
quality of reported earnings, and sell-side advisory services. He also has significant experience in cross-border transactions in the US, UK, Chile, and Canada, among others.
He has worked in PwC’s Santiago, Chile, and Seoul, South Korea offices. McCeney received
a Bachelor of Science in Business Administration and is a Certified Public Accountant
in New York, Texas, and Virginia.
Mile Milisavljevic is a Partner with Deals Strategy based in Houston and is the leader of
Natural Resources Deals Strategy efforts in the US. Milisavljevic’s expertise is in working
with financial and strategic investors in driving transformative change through M&A.
He has more than 10 years of strategy consulting experience across different industries.
Milisavljevic received his PhD from the Georgia Institute of Technology and his MBA
from Wharton at the University of Pennsylvania. Prior to joining PwC Deals Strategy, he
was with Bain & Company.
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