October 15 2025 | M&A Advisors | Deals | Utilities & Infrastructure
According to Ansarada’s FY25 ANZ Deal Indicators Report , the utilities sector has seen a short-term decline in deal volumes, although trends from Ansarada’s deal room indicate that year-on-year growth remains relatively stable.
The data reveals a notable decline in deals in the utilities sector over the most recent quarter, with a 32% drop in transaction volumes. This downturn reflects broader market challenges, including regulatory pressures and shifts in consumer demand.
A challenging time
The decline in utilities transactions sharply contrasts with the performance of other sectors benefiting from long-term mega trends. For instance, Ansarada’s deal room data shows the communications services sector saw a remarkable 400% increase in quarterly transactions. This demonstrates demand for communications infrastructure driven by technological advancements and the increasing need for digital connectivity.
Examining year-on-year performance, the utilities sector presents a more nuanced picture. Despite the recent quarterly decline, the sector recorded a 42% increase in transaction volumes compared to the same period last year. So, while the utilities sector currently faces short-term challenges, there is a strong underlying demand for investment in infrastructure and services that will support deal flow in the future.
Deals reflect mega trends
In FY25, utilities investment in Australia and New Zealand has primarily been driven by modernisation initiatives and regulatory restructuring. In particular, the sector saw an increased focus on transmission and distribution infrastructure investments, reflecting the need for grid modernisation to support renewable energy integration.
Contact Energy’s pending $1.4 billion acquisition of Manawa Energy in New Zealand is the standout utilities deal for the year, highlighting the growing focus on hydroelectric power as a sustainable energy source.
In a significant move within Australia's energy sector, the Future Fund has acquired a 9.995% stake in Transgrid from Canadian Pension Plan, OMERS, which retains an equal stake and will manage the Future Fund's interest.
Still on Transgrid, the Utilities Trust of Australia (UTA) has agreed to sell a 10% stake in the New South Wales electricity transmission company to Singapore's GIC, advised by Citi. This sale comes as UTA, which will retain a 12.5% stake post-transaction, faces significant capital expenditure demands to integrate new renewable energy sources into the grid.
Transgrid, the largest electricity transmission network in Australia, plays a crucial role in the National Electricity Market and is pivotal to the country's decarbonisation efforts. The Future Fund's investment in it aligns with the fund’s long-term objectives, aiming to support Transgrid's growth while diversifying its infrastructure portfolio.
National differences
More broadly, across the period, Australian utilities companies prioritised capital expenditure on infrastructure upgrades and smart grid technologies to enhance network reliability and efficiency. It’s a slightly different story in New Zealand, where regulatory developments have supported infrastructure investment, with the Commerce Commission’s regulatory framework providing stability for long-term planning.
Although there has been muted activity in utilities transactions recently, the long-term outlook for the sector remains optimistic, particularly as the Australian government continues to prioritise investments in renewable energy and sustainable infrastructure.
Looking ahead, expect deal flow to include transactions involving hydroelectric power and wind energy projects, which should present significant opportunities for M&A activity in the utilities sector over time.
