As the summer recedes, there is a renewed push to get M&A deals across the line. The two industrial sectors that we are seeing leading the charge are energy and technology.

This is consistent with the findings of Brodies LLP’s latest report, ‘Evolution not revolution: investing in the energy transition’, that we published earlier in the year.

Energy transition drives M&A opportunities

In energy, the push to diversify into renewable generation assets – such as agri-adjacent biogas production – and construct co-located facilities for energy storage and digitalisation are two specific areas predicted by the report that are bearing fruit.

These types of projects have long commercial lives (and payback periods) and currently appear to be very desirable to both equity investors and project funders.

 

As the landscape shifts, it’s crucial that government, regulators and professional bodies keep the public interest at the heart of any decisions

Oil and gas faces uncertainty in the North Sea

The oil and gas industry remains fairly frustrated. Despite global tensions pushing up the commodity price, the government’s delayed decisions on the Rosebank and Jackdaw oilfields and the decision of BP to exit the North Sea have combined to cast a (hopefully short-term) air of disappointment over an otherwise prosperous sector of the Scottish economy.

That said, companies that would previously have identified as ‘oilfield services’ and have successfully reorientated as ‘energy services’ are making the most of the opportunities on a global basis (with attendant deal opportunities) and the BP deal itself will be a significant piece of M&A.

AI and digitalisation reshape business operations

Meanwhile, digitalisation is quietly transforming commercial operations in many companies across all sectors. For many, artificial intelligence solutions are fundamentally changing the way they do business.

The use of AI agents removes the burden and can improve the output of routine tasks, increasing efficiency and accuracy. The doomsayers may worry about the impact on jobs, but – so far – the predominant anecdotal result has been increased efficiency for employees and businesses as a whole.

There is a long road to run on the question of the impact of AI, but could this be part of the answer to bridging the country’s infamous productivity gap?

Martin Ewan is a partner at Brodies LLP. Martin works mainly in the energy and technology sectors, with a growing involvement in cleantech opportunities.

FAQs

Which sectors are driving Scottish dealmaking?
Energy and technology are leading the current push to complete mergers and acquisitions, according to Brodies LLP.

 

Where are the opportunities in the energy transition?
Brodies points to renewable generation, including biogas production, alongside energy storage and digitalisation projects.

 

How is uncertainty in the North Sea affecting deals?
Delayed decisions on Rosebank and Jackdaw have dampened confidence. Energy services companies are still finding opportunities internationally, while BP’s proposed North Sea exit could itself lead to a significant deal.

 

What role is AI playing in business?
AI agents are helping companies handle routine tasks more efficiently. Their longer-term effect on jobs and productivity remains uncertain.

Partner Content in association with Brodies LLP