A predictable drop in first-quarter energy industry mergers followed the year-end rush to complete deals ahead of feared federal tax hikes, PwC reported Wednesday.
The accounting and consulting firm noted that merger and acquisition activity typically slows in the first quarter anyway, and that the surge in the October-December quarter amplified that effect.
A political fight in Washington, temporarily resolved at the beginning of this year, had raised the prospect of billions in tax hikes and spending cuts that became known as the fiscal cliff.
PwC counted 75 deals in the fourth quarter of 2012, with total value of $56.2 billion.
Ernst & Young: Energy industry fueled by strong M&A activity
PwC noted, however, that compared with the first quarter of 2012, first-quarter activity rose to 39 oil and gas deals worth $27 billion from 34 deals totaling $25.7 billion.
It attributed the year-over-year increase to continuing interest in U.S. shale plays, where new technology is fueling a boom in oil and gas production.
The shale plays with most first-quarter merger-acquisition activity were the Eagle Ford in South Texas, followed by the Marcellus and Utica in the northeastern United States and the Bakken in North Dakota, PwC said.
PwC’s quarterly report analyzes announced U.S. transactions with value greater than $50 million, based on data from IHS Herold.