Infrastructure deal-making activity is set to pick up later in the year, despite investor caution.
According to DC Advisory’s latest Infrastructure Quarterly, inflationary pressures and economic and geopolitical uncertainty have led to a challenging infrastructure deal-making environment. In turn, cautious buyers and a tough lending environment have led to lower valuations. Despite a slowdown in activity in 2022, DC Advisory is confident the infrastructure market will remain resilient and see a rebound of deal activity later in 2023.
The international investment bank notes four subsectors to watch closely will be energy, transport, digital and core-plus.
Within energy, companies that can demonstrate they’re reducing carbon production are likely to pique investor interest. DC Advisory expects to see continued deal flow in storage, transmission, distributed energy and clean mobility sectors, with cross-border deals happening at an increasing rate. Net-zero tar